Behavioral Capital Theory via Canonical Quantization

We show how a behavioral form of capital theory can be derived using canonical quantization. In particular, we introduce quantum cognition into capital theory by applying Dirac's canonical quantization approach to Weitzman's Hamiltonian formulation of capital theory, the justification for the use of quantum cognition being the incompatibility of questions encountered in the investment decision-making process. We illustrate the utility of this approach by deriving the capital-investment commutator for a canonical dynamic investment problem.

Automated summary

We demonstrate the derivation of a behavioral form of capital theory using canonical quantization. By applying Dirac's canonical quantization approach to Weitzman's Hamiltonian formulation of capital theory, we incorporate quantum cognition into the theory to address the incompatibility of questions encountered in the investment decision-making process. We illustrate the usefulness of this approach by deriving the capital-investment commutator for a canonical dynamic investment problem.