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Extreme economic events, such as stock market crashes or booms, are increasingly being examined using methods developed to study the physics of phase transitions or critical phenomena. Some of the studies have led to theories claiming to be able to predict these events. In the past five years, there has been an enormous increase in these activities, using statistical physics and computer modelling, resulting in differing theories and occasional scepticism.
A NATO research workshop took place in Prague on 8-10 February, where the exponents of many of the leading theories gathered to present the pertinent developments and have them subjected to critical assessment. Supported under the NATO Science Programme, the workshop brought together over 50 experts, both physicists and economists, from 17 NATO and Partner countries. The results of their deliberations will be published in a special issue of the physics journal "Physica A".