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The Complexity Era in Economics

  • David Colander


  • Richard P.F. Holt
  • J. Barkley Rosser

This article argues that the neoclassical era in economics has ended and is being replaced by a new era. What best characterizes the new era is its acceptance that the economy is complex, and thus that it might be called the complexity era. The complexity era has not arrived through a revolution. Instead, it has evolved out of the many strains of neoclassical work, along with work done by less orthodox mainstream and heterodox economists. It is only in its beginning stages. The article discusses the work that is forming the foundation of the complexity era, and how that work will likely change the way in which we understand economic phenomena and the economics profession.

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Paper provided by Middlebury College, Department of Economics in its series Middlebury College Working Paper Series with number 1001.

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Length: 23 pages
Date of creation: Jan 2010
Date of revision:
Handle: RePEc:mdl:mdlpap:1001
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  1. Hommes, Cars H., 2006. "Heterogeneous Agent Models in Economics and Finance," Handbook of Computational Economics, in: Leigh Tesfatsion & Kenneth L. Judd (ed.), Handbook of Computational Economics, edition 1, volume 2, chapter 23, pages 1109-1186 Elsevier.
  2. repec:tpr:qjecon:v:114:y:1999:i:3:p:817-868 is not listed on IDEAS
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  5. K. Vela Velupillai, 2007. "A Computable Economist’s Perspective on Computational Complexity," Department of Economics Working Papers 0723, Department of Economics, University of Trento, Italia.
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  9. Kam-Chau Wong & Marcel K. Richter, 1999. "Non-computability of competitive equilibrium," Economic Theory, Springer, vol. 14(1), pages 1-27.
  10. David Colander (ed.), 2000. "The Complexity Vision and the Teaching of Economics," Books, Edward Elgar, number 1955, April.
  11. Debreu, Gerard, 1974. "Excess demand functions," Journal of Mathematical Economics, Elsevier, vol. 1(1), pages 15-21, March.
  12. Sent, Esther-Mirjam, 1997. "Sargent versus Simon: Bounded Rationality Unbound," Cambridge Journal of Economics, Oxford University Press, vol. 21(3), pages 323-38, May.
  13. Axel Leijonhufvud, 2009. "Out of the corridor: Keynes and the crisis," Cambridge Journal of Economics, Oxford University Press, vol. 33(4), pages 741-757, July.
  14. Binmore, Ken & Shaked, Avner, 2010. "Experimental economics: Where next?," Journal of Economic Behavior & Organization, Elsevier, vol. 73(1), pages 87-100, January.
  15. Fehr, Ernst & Schmidt, Klaus M., 1998. "A Theory of Fairness, Competition and Cooperation," CEPR Discussion Papers 1812, C.E.P.R. Discussion Papers.
  16. David Colander, 1995. "Marshallian General Equilibrium Analysis," Eastern Economic Journal, Eastern Economic Association, vol. 21(3), pages 281-293, Summer.
  17. J. Barkley Rosser Jr & Richard P.F. Holt & David Colander, 2010. "European Economics at a Crossroads," Books, Edward Elgar, number 13585, April.
  18. Matthew Rabin., 1997. "Psychology and Economics," Economics Working Papers 97-251, University of California at Berkeley.
  19. D. Colander., 2009. "The Complexity Revolution and the Future of Economics," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 1.
  20. Sheri M. Markose, 2004. "Computability and Evolutionary Complexity: Markets As Complex Adaptive Systems (CAS)," Economics Discussion Papers 574, University of Essex, Department of Economics.
  21. David Colander & Ric Holt & Barkley Rosser, 2003. "The Changing Face of Mainstream Economics," Middlebury College Working Paper Series 0327, Middlebury College, Department of Economics.
  22. Kurt Dopfer & John Foster & Jason Potts, 2004. "Micro-meso-macro," Journal of Evolutionary Economics, Springer, vol. 14(3), pages 263-279, 07.
  23. Colander, David C., 2008. "Economists, Incentives, Judgment, and Empirical Work," Economics Discussion Papers 2008-12, Kiel Institute for the World Economy.
  24. Herbert A. Simon, 1996. "The Sciences of the Artificial, 3rd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262691914, June.
  25. K. Vela Velupillai, 2004. "A primer on the tools and concept of computable economics," Department of Economics Working Papers 0405, Department of Economics, University of Trento, Italia.
  26. Tesfatsion, Leigh, 2006. "Agent-Based Computational Economics: A Constructive Approach to Economic Theory," Handbook of Computational Economics, in: Leigh Tesfatsion & Kenneth L. Judd (ed.), Handbook of Computational Economics, edition 1, volume 2, chapter 16, pages 831-880 Elsevier.
  27. Buti,Marco & Deroose,Servaas & Gaspar,Vitor & Martins,João Nogueira (ed.), 2010. "The Euro," Cambridge Books, Cambridge University Press, number 9789279098420, October.
  28. Tesfatsion, Leigh & Judd, Kenneth L., 2006. "Handbook of Computational Economics, Vol. 2: Agent-Based Computational Economics," Staff General Research Papers 10368, Iowa State University, Department of Economics.
  29. J. Barkley Rosser, 1999. "On the Complexities of Complex Economic Dynamics," Journal of Economic Perspectives, American Economic Association, vol. 13(4), pages 169-192, Fall.
  30. Mirowski, Philip, 2007. "Markets come to bits: Evolution, computation and markomata in economic science," Journal of Economic Behavior & Organization, Elsevier, vol. 63(2), pages 209-242, June.
  31. Schelling, Thomas C, 1969. "Models of Segregation," American Economic Review, American Economic Association, vol. 59(2), pages 488-93, May.
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