The Economy As An Evolving Complex System II

W. Brian Arthur, Steven N Durlauf, David Lane

• Publisher: CRC Press
• Year: 2018
• eBook ISBN: 9780429976261
• Edition: 1
• Topic: Mathematics
• Subtopic: Mathematics General
• Index: Mathematics

A new view of the economy as an evolving, complex system has been pioneered at the Santa Fe Institute over the last ten years, This volume is a collection of articles that shape and define this view?a view of the economy as emerging from the interactions of individual agents whose behavior constantly evolves, whose strategies and actions are always adapting.The traditional framework in economics portrays activity within an equilibrium steady state. The interacting agents in the economy are typically homogenous, solve well-defined problems using perfect rationality, and act within given legal and social structures. The complexity approach, by contrast, sees economic activity as continually changing?continually in process. The interacting agents are typically heterogeneous, they must cognitively interpret the problems they face, and together they create the structures?markets, legal and social institutions, price patters, expectations?to which they individually react. Such structures may never settle down. Agents may forever adapt and explore and evolve their behaviors within structures that continually emerge and change and disappear?structures these behaviors co-create. This complexity approach does not replace the equilibrium one?it complements it.The papers here collected originated at a recent conference at the Santa Fe Institute, which was called to follow up the well-known 1987 SFI conference organized by Philip Anderson, Kenneth Arrow, and David Pines. They survey the new study of complexity and the economy. They apply this approach to real economic problems and they show the extent to which the initial vision of the 1987 conference has come to fruition.

Index

A

academic viewpoint, 16

vs. trader viewpoint, 16

adaptation, 5, 47–49, 51, 78, 331, 397, 407, 465, 468, 495–496

adaptive belief

evolution of, 418

modeling of, 402, 416

systems, 402, 409, 412

models of, 402

adaptive computational models, 484

adaptive equilibrium dynamics, 418

adaptive political parties, 465, 469

behavior, 465–466, 471

model, 478, 482

adaptive rational equilibrium dynamics (ARED), 417

agent matching, 154

agent/artifact space, 174, 182–183, 185–187, 189, 191–192, 194, 197

structural changes, 182–183, 185–186, 197

structural instability, 188

agent-based models, 10–11

agent-based trade network game (TNG), 561 See also trade network game

agglomeration, 239, 248, 250, 252

agglomeration economies, 246–247

aggregate behavior, 492, 502, 504, 516, 524

aggregative macroeconometrics, 388

altruism, 216

amortizing mortgage, 288

Anderson, P. W., 12

anisotropic models, 146, 148

anisotropic settings, 138, 160

annealing, 477, 484

annealing algorithm, 464

anonymous endogenous interactions, 370–371, 374

defined, 370–371

arbitrage pricing model (APT), 19, 404

Arrow-Debreu, 304, 333–334

economy, 301

equilibrium, 300, 308–310, 312

model, 130, 143–145, 264, 497

ext...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• Introduction
• Asset Pricing Under Endogenous Expectations in an Artificial Stock Market
• Natural Rationality
• Statistical Mechanics Approaches to Socioeconomic Behavior
• Is What Is Good for Each Best for All? Learning From Others in the Information Contagion Model
• Evolution of Trading Structures
• Foresight, Complexity, and Strategy
• The Emergence of Simple Ecologies of Skill
• Some Fundamental Puzzles in Economic History/Development
• How the Economy Organizes Itself in Space: A Survey of the New Economic Geography
• Time and Money
• Promises Promises
• Macroeconomics and Complexity: Inflation Theory
• Evolutionary Dynamics in Game-Theoretic Models
• Identification of Anonymous Endogenous Interactions
• Asset Price Behavior in Complex Environments
• Population Games
• Computational Political Economy
• The Economy as an Interactive System
• How Economists Can Get ALife
• Some Thoughts About Distribution in Economics
• Index