Knowledge Directed Economic Selection and Growth
The single most important postulate in economics is what you assume about the totality of all possible states that the economy can be in (the state space). The assumption you make determines the costs of information and learning when exploring that state space, the nature of the equilibrating forces of the markets of the economy, towards what kind of equilibrium the economic system is heading and what that means for the modes of behavior of individuals and firms, in short the dynamics of the economy. The mainstream model of economics assumes a very narrow and, for all practical purposes, fully transparent state space and thus excludes all interesting dynamics from the analysis by assumption. I argue for the alternative assumption of a very large and non-transparent state space, or investment opportunities space that takes us into the unpredictable world of an Experimentally Organized Economy that is more compatible with economic reality. In that brave new world of economics new answers to old questions appear. Above all, using the tools of analysis developed from, and for the mainstream neoclassical model to study the realities of an EOE will place the analyst in a misinformation situation. I illustrate that through simulation on the Swedish micro to macro (MM) model and with one Swedish business case.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 27 (2009)
Issue (Month): 4 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/CPRO20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/CPRO20|
When requesting a correction, please mention this item's handle: RePEc:taf:promet:v:27:y:2009:i:4:p:371-387. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.