Complexity Economics

Hat Tip ~ Brian Arthur

"Economics is a stately subject, one that has altered little since its modern foundations were laid in Victorian times. Now it is changing radically. Standard economics is being challenged by a number of new approaches: behavioral economics, neuroeconomics, new institutional economics. One of the new approaches came to life at the Sante Fe Institute: complexity economics.

Complexity Economics got its start in 1987 when a now-famous conference of scientists and economists convened by physicist Phillip Anderson and economist Kenneth Arrow met to discuss the economy as an evolving complex system. That conference gave birth a year later to the institutes first research program _ The Economy as a Complex Adaptive System - and I was asked to lead this.That program in turn has gone on to lay down a new and different way to look at the economy.

To see how complexity economics works, think of the agents in the economy - consumers, firms, banks, investors - as buying and selling, producing, strategizing, and forecasting. From all this behavior, markets form, prices form, trading patterns form. Complexity economics asks how individual behaviors in a situation might react to the pattern they together create, and how that pattern would alter itself as a result, causing the agents to react anew.

Universal Laws of Science and the laws of Life

Nature is Governed by universal laws

Classical Science and Determinism

The Law of Nature and Human reason - if we Know the laws of Nature we can predict the future by ration means....

Evidence is Biased

Clockwork Universe

Small change produces small change

Classical Determinism and predictability

Four Domain of Conceptual Revolution

1- Fractals
2- Chaos Mathematics -
3- Self organization (spontaneous) Disequilibrium constant change
4- Emergent Computation - Artificial Life - Laws of Intelligence

Unified Systems That Provides

This is the science that will shape our lives in the 21sr century...

Thermal Dynamics
Chaos Theory
Fractal Geometry