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Mitchell Waldrop: Complexity, the emerging science at the edge of order and chaos

Chapter 1: The idea of an Irish hero

Reviewed by Charles Szersnovicz.


Ph.D W. Brian Arthur is an actual well-known economist. He always was fascinated by the complexity in our world: "why simple particles obeying simple rules will sometime engage in astonishing, unpredictable behavior ?". Science is not for him an other word for order, equilibrium, stability, but for patterns, accident, unpredictability. He compared the biology and the economy and found a lot in common, the most important is maybe the origin of evolution of these two worlds: accidents. He tried and succeed to build new rules of real-market, by adapting his notion with increasing returns. But this controversial vision is a real revolution. Indeed, neoclassical economy is an exact science, perfect-balanced, mathematical and  "non-real" for Arthur. But as in biology, physics and mathematics can't define it. In these sciences, the notion of self-organization is omnipresent. Also, positive feedback is the essence of life's evolution, despite negative feedback is how actual market is define, and for Arthur, it's totally wrong.

Arthur tried many times to explain his new vision but had for many years no recognition because of the american market culture which is the opposite. This culture promotes that we are lock-in technologies or way to do some thing because they are the best. But for Arthur, we are lock-in only by accident or coincidence, small chance events magnified by positive feedback. Moreover, in the neoclassical economy, monopoly is not possible, negative feedback is not allowing it. Arthur tried for many years to communicate is vision, real-market, a mix between positive and negative feedback that produces unpredictable patterns, evolution, "showing how chance events work to select one equilibrium point from many possible in random processes", and not anymore only one. In the country of maximum individual freedom, it's hard to convince. Arthur, built a mathematical model that shows the omnipresence of fortuity, because "when you mathematize something you distill its essence". It works.


I found this chapter very interesting and it makes me thinking about a lot of new things. But at the end, when I tried to summarize what this conception of science will change I couldn't find anything. I think the lack of implementation of his theory is the reason. In fact, Arthur maid only observations and no conclusions, or interpretations, because he didn't applied this on a real system. The "reaction" of others which he described was mine too : "Yes it's true ! And so ?". When you read his story you totally agree with anything but something is wrong.  I stopped after, looking for what was it and finally found that in my opinion, Arthur made great observations but useless. Why ? He just defined the complement of what is the actual science of economy. As a picture, he defined the negative, where the picture is order, the neoclassical economy and the negative, chaos or increasing returns, his vision of economy. Its two different ways to describe the same thing, indeed, one is directly linked to the other, you just have to complement it to find the other one. In other words, he didn't discovered a new model, but only the complement of the actual.

"Negative feedback ensures that no one firm or product can ever grow enough to dominate the market", that is what actual neoclassical economy ensures. Just after reading that, I read an article from CNN Money which explains why the Apple inc.'s shares cannot join the Dow Jones Industrial Average: the Dow Jones market will be too influenced by Apple's evolution...