Friday, November 6, 2015
How complicated is complexity?
Since I read the books by Samuel Bowles on "Microeconomics" and by Beinhocker on "The Origin of Wealth" some years ago I felt attracted to ways to model complexity in economics, for example by using agent-based modelling. I even have a chapter in my course on the economics of soccer on "last frontiers" of research devoted to examples of evolutionary social sciences, complexity and neuro-sciences. I keep reading about these issues. I took today from the library the three books in the trilogy by Joshua M. Epstein, and I printed two papers by Durlauf, one on the relationship of complexity economics to empirical methods, and another one on its relationship to public policies. What makes this combination of readings interesting is that Durlauf is quite critical of some of the work of Epstein. I'll read all this carefully. Meanwhile, I'm interested in finding ways to introduce evolutionary dynamics in the way that some aspects of public economics unfold, such as the fading nature of some units (nation-states) or the evolution of regulatory agencies. These idea of changing boundaries and endogenizing the existence, size and structure of agents has also been present in some of the work of Swedish scholar Lars-Erik Cederman. The good side of Durlauf's message is that complexity economics is less of a departure from mainstream economics. If after all these years I managed to understand some of mainstream economics, perhaps it is not too late to be able to understand and use techniques and insights from the economics of complex systems to see if they can help explain some of the phenomena I'm interested in about political economy, regulation, institutions and related fields.