Table of Contents

Complexity and the Economy

Complexity and the Economy

Implications for Economic Policy

Edited by John Finch and Magali Orillard

The authors examine the causes and consequences of complexity among the broadly economic phenomena of firms, industries and socio-economic policy. The book makes a valuable contribution to the increasingly prominent subject of complexity, especially for those whose interests include evolutionary, behavioural, political and social approaches to understanding economics and economic phenomena.

Chapter 1: Complexity and the Economy: An Interview with W. Brian Arthur

Robert Delorme and Geoffrey M. Hodgson

Subjects: economics and finance, evolutionary economics, institutional economics

Extract

Interviewed by Robert Delorme and Geoffrey M. Hodgson of EAEPE on 8 November 2002 in Aix-en-Provence Interviewer Could you briefly outline how you developed your ideas on path dependence, positive feedbacks and complexity, and what problems you encountered in convincing others of their importance? WBA As an undergraduate I had been trained as an electrical engineer so I knew quite a bit about positive feedback. Also, when I started to study economics in the early 1970s at Berkeley my key interest was in economic development and so I was exposed to the ideas of cumulative causation by Gunnar Myrdal, the forward and backward linkages of Hirshman – the sorts of things we would now describe as positive feedbacks. I took plenty of courses in neoclassical economics but they didn’t speak to me as much as the dynamics of development did. My PhD was in operations research and that was heavily dynamical (I worked on control theory under Stuart Dreyfus). So my whole background was to look at dynamics. I was attracted to dynamics with cumulative causation positive feedbacks. Around 1979 I read The Eighth Day of Creation by Horace Freeland Judson [1979], which was a rather thick book of the coming into being of molecular biology – a wonderful book. As a result I started to read about molecular biology and eventually about enzyme reactions. I was visiting the University of Hawaii at the time and had eight weeks to do as I pleased. I read Jacques Monod’s book Chance and...

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