Economies are complicated systems encompassing micro behaviors, interaction patterns, and global regularities. Whether partial or general in scope, studies of economic systems must consider how to handle difficult real-world aspects such as asymmetric information, imperfect competition, strategic interaction, collective learning, and the possibility of multiple equilibria. Recent advances in analytical and computational tools are permitting new approaches to the quantitative study of these aspects. One such approach is Agent-based Computational Economics (ACE), the computational study of economic processes modeled as dynamic (...) systems of interacting agents. This chapter explores the potential advantages and disadvantages of ACE for the study of economic systems. General points are concretely illustrated using an ACE model of a two-sector decentralized market economy. Six issues are highlighted: Constructive understanding of production, pricing, and trade processes; the essential primacy of survival; strategic rivalry and market power; behavioral uncertainty and learning; the role of conventions and organizations; and the complex interactions among structural attributes, institutional arrangements, and behavioral dispositions. (shrink)

What enables individually simple insects like ants to act with such precision and purpose as a group? How do trillions of individual neurons produce something as extraordinarily complex as consciousness? What is it that guides self-organizing structures like the immune system, the World Wide Web, the global economy, and the human genome? These are just a few of the fascinating and elusive questions that the science of complexity seeks to answer. In this remarkably accessible and companionable book, leading complex systems (...) scientist Melanie Mitchell provides an intimate, detailed tour of the sciences of complexity, a broad set of efforts that seek to explain how large-scale complex, organized, and adaptive behavior can emerge from simple interactions among myriad individuals. Comprehending such systems requires a wholly new approach, one that goes beyond traditional scientific reductionism and that re-maps long-standing disciplinary boundaries. Based on her work at the Santa Fe Institute and drawing on its interdisciplinary strategies, Mitchell brings clarity to the workings of complexity across a broad range of biological, technological, and social phenomena, seeking out the general principles or laws that apply to all of them. She explores as well the relationship between complexity and evolution, artificial intelligence, computation, genetics, information processing, and many other fields. Richly illustrated and vividly written, Complexity : A Guided Tour offers a comprehensive and eminently comprehensible overview of the ideas underlying complex systems science, the current research at the forefront of this field, and the prospects for the field's contribution to solving some of the most important scientific questions of our time. (shrink)