A key tenet of the Transactional Interpretation of Quantum Mechanics is the idea that photon absorption localizes the absorbing material system. In doing so, it measures the location of the absorber and hence reduces information entropy which in turn needs to be balanced by appropriate entropy production, if there is a link between information entropy and thermodynamic entropy. Based on a critical analysis of the physics of information erasure, we clarify the link between information and thermodynamic entropy and develop a rigorous model of entropy production in photon-absorption processes. Links to the interpretation of quantum probabilities and to Maxwell's demon are made.
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