Complexity Economics An Introduction

Understanding our global economy as a complex system

What you'll learn

The aim of this course is to give you a solid grasp of the core concepts within the domain of complexity economics

By the end of the course you should be familiar with and be able to apply the most important models from complexity economics

Requirements

There are no prerequisites to this course aside for a firm grasp of the english language and general knowledge of standard economic theory

Description

OverviewAs advanced economies come to the end of the process of industrialization and with the rise of information technology we are witnessing the birth of a new type of post-industrial economy, it is built on services, fueled by information and knowledge and it is increasingly integrated through global financial and supply chain networks. These huge changes in the deep architecture to our economies go far beyond our industrial paradigm and are necessitating a re-imagination of economy theory. General equilibrium models that were derived from classical physics got mathematized during the 20th century, these models give us a picture of the economy as composed of isolated, purely rational individuals, optimizing over a well defined set of preferences out of which we get a macro level general equilibrium in a somewhat static and timeless economy.It was a paradigm that fitted well with industrial age mechanization. But today the limitations of general equilibrium theory are becoming more apparent as we build new models, models to individual agents that have bounded rationality, driven by a diversity of motives they are interconnected and interdependent. And it is out of these nonlinear interactions we get the emergence of economic institutions as network structures that are far-from-equilibrium, in an economy that is constantly changing from internal drivers as it develops over time through an evolutionary process.ContentThis course is an overview to the new area of complexity economics, the application of models from complexity theory to the domain of economic science. The course is broken down into five main sections, we will start off with an overview to economic theory discussing our standard approach before going on to give a clear outline to the main ideas coming out of complexity economies. Next we will borrow from behavioral economics to build up a more complex model to economic agents as we talk about the idea of bounded rationality, different theories of value, choice theory and incentive systems.In the third section we will be looking at nonlinear economics as we apply system dynamics to modeling micro economic phenomena, we will be talking about how feedback loops create nonlinearity and the process of self-organization out of which emerges non-equilibrium patterns of organization in the economy. Next we will apply network analysis to modeling macro level economic institutions such as markets, we will introduce you to the basics of network theory and go on to talk about economic networks, their topology, distribution and dynamics. In the final section will be looking through the lens of complex adaptive systems theory to understand how whole macro economies emerge out of the actions and reactions of many different organizations, we will use the model of a fitness landscape in order to help us understand the process of economic evolution.

Overview

Section 1: Overview

Lecture 1 Course Overview

Lecture 2 Complexity Theory Overview

Lecture 3 Economic Theory

Lecture 4 Standard Economic Theory Part 1

Lecture 5 Standard Economic Theory Part 2

Lecture 6 Context Part 1

Lecture 7 Context: Information Revolution

Lecture 8 Context: Globalization

Lecture 9 Context: Sustainability

Lecture 10 Complexity Economics Part 1

Lecture 11 Complexity Economics Part 2

Section 2: Behavioural Economics

Lecture 12 Behavioural Economics

Lecture 13 Value Theory

Lecture 14 Choice Theory

Lecture 15 Incentive Systems

Section 3: Nonlinear Economics

Lecture 16 Causal Links

Lecture 17 Feedback Loops

Lecture 18 Self-Organization

Lecture 19 Non-Equilibrium

Section 4: Network Economics

Lecture 20 Network Theory

Lecture 21 Network Topology

Lecture 22 Network Dynamics

Section 5: Complex Adaptive Systems

Lecture 23 Complex Adaptive Systems

Lecture 24 Resiliency

Lecture 25 Evolution

This course is intended for a broad group of people but will be particularly relevant for those with a background in economics or busness management