Heat moves from hot to cold because temperature differences push it. Entropy rises, and things settle toward balance

 Heat moves from hot to cold because temperature differences push it. Entropy rises, and things settle toward balance. Think of capital the same way: money leaves low-return areas and goes to higher-return ones. Competition then nudges profit rates toward a common level across industries. The “maximum entropy” idea adds a useful lens: given some constraints, the system tends to the least-biased overall pattern—like a market finding a broad, statistical balance.

But this isn’t a hard physical law. In practice, what evens out is risk-adjusted expected returns. Entry and exit costs, rules and institutions, market power, uneven information, credit limits, tech change, and shifting demand all slow or skew the process. Time scales differ too: heat diffusion follows fixed physical constants; capital flows depend on institutions, information, and credit, so extra profits can last for a while. And economies have no strict “conservation law”—credit creation and creative destruction keep changing the game.