W. Brian Arthur

 

Comments on the book

"Brian Arthur has made a great contribution by reorienting the way we look at economic phenomena. It is very good to have many of the papers in which Arthur introduced the complexity approach reproduced here." — Kenneth J. Arrow

“Economics is changing and Brian Arthur is a key catalyst in that change. This book blends Arthur's seminal work developing complexity economics with his exciting new work exploring technology, showing the connection between the two, his creative brilliance, and the combinatorial evolution of his thinking. It provides readers with a vision of the future of economics.”

-- David Colander, Middlebury College

"For too long economic theory has viewed the economy as an imaginary world of rational people and perfect markets in optimal equilibrium.  W. Brian Arthur is one of the true pioneers of 'complexity economics', an approach to understanding the economy as it really is - a complex and constantly changing ecosystem of imperfect people, evolving institutions, and disruptive technologies.  This landmark collection of Arthur’s key papers will be studied and referred to for decades to come."

— Eric Beinhocker, Oxford

“No other volume covers the complexity/economics area with this combination of depth and accessibility.”

—John Holland, Univ of Michigan

 

 

 

 

 

 

Book: Complexity and the Economy

Oxford University, Oct 2015

From the cover: "Economics is changing. In the last few years it has generated a number of new approaches. One of the most promising - complexity economics - was pioneered in the 1980s and 1990s by a small team at the Santa Fe Institute. Economist and complexity theorist W. Brian Arthur led that team, and in this book he collects many of his articles on this new approach. The traditional framework sees behavior in the economy as in an equilibrium steady state. People in the economy face well-defined problems and use perfect deductive reasoning to base their actions on. The complexity framework, by contrast, sees the economy as always in process, always changing. People try to make sense of the situations they face using whatever reasoning they have at hand, and together create outcomes they must individually react to anew. The resulting economy is not a well-ordered machine, but a complex evolving system that is imperfect, perpetually constructing itself anew, and brimming with vitality.

"Complexity economics holds that the economy is not necessarily in equilibrium, that computation as well as mathematics is useful in economics, that increasing as well as diminishing returns may be present in an economic situation, and that the economy isn't something given and existing but forms from a constantly developing set of institutions, arrangements, and technological innovations.

"The new vision complements the standard one, and it helps answer many questions: Why does the stock market show moods and a psychology? Why do high-tech markets tend to lock in to the dominance of one or two very large players? How do economies form, and how do they continually alter in structure over time?

"The papers collected here were among the first to use evolutionary computation, agent-based modeling, and cognitive psychology. They cover topics as disparate as how markets form out of beliefs; how technology evolves over the long span of time; why systems and bureaucracies get more complicated as they evolve; and how financial crises can be foreseen and prevented in the future."

 

 


 

© 2022 W. Brian Arthur