The collapse of the Soviet Union was a physical phase transition triggered by a sudden flight of capital.
April 24, 2026
Original Paper
Stochastic Networked Governance: Bridging Econophysics and Institutional Dynamics in a Positive-Sum Agent-Based Model
arXiv · 2604.19968
The Takeaway
Geopolitical collapses can be modeled using the same principles of econophysics that describe structural failures in nature. The Soviet Union's fall was not just a political event but a mathematically predictable result of scale-invariant shocks to its economic network. When capital began to leave the system, the network reached a tipping point where it could no longer maintain its internal structure. This model explains why massive empires can seem stable for decades and then disintegrate in a matter of months. History may be driven by physical laws of network resilience that are invisible to traditional political analysis.
From the abstract
Traditional macroeconomic growth models rely on general equilibrium and continuous, frictionless institutional transitions, failing to account for the catastrophic structural collapses observed in empirical economic history. We propose the Stochastic Networked Governance (SNG) model, a discrete-time, agent-based framework that bridges econophysics, network science, and institutional economics. By defining jurisdictions through a binary institutional genome, the model formalizes institutional com