Financial laws as algebraic automata

It is shown that the concept of financial law has the structure of an automaton. Furthermore, a financial law induces a group structure into the monoid of the automaton. The concepts of stationary, stationary of order n , and dynamic financial laws are deduced, proving two algebraic characterizations. Finally the concept of ā ‐stationary financial law and some applications are introduced. © 2001 John Wiley & Sons, Inc.