Sublime

This paradox of comprehension was articulated explicitly by a great physicist of an earlier age: “Sir Isaac Newton, when asked what he thought of the infatuations of the people, answered that he could calculate the motions of erratic bodies, but not the madness of a multitude” (quoted from The Church of England Quarterly Review, 1850).

foundations were laid in Victorian times. Now it is changing radically. Standard economics is suddenly being challenged by a number of new approaches: behavioral economics, neuroeconomics, new institutional economics. One of the new approaches came to life at the Santa Fe Institute: complexity economics.

Big Idea Eight: Economic Booms and Busts Cannot Be Avoided but Can Be Moderated

transient sync

As a new point of view we turn to bounded rationality, a departure from the mainstream tradition. We no longer can assume that every agent is a perfect calculator. This point of view is given a great deal of emphasis by Herbert Simon. Simon argued that people do not maximize. When they’re forecasting the future, they do not perform the task of rati

So, I agree when you say we shouldn’t categorize the economy. We shouldn’t observe the economy and be like, “Oh, that’s a harmonic oscillator.” Yeah. “That’s an Ising model.” No. But we should absorb the data. We should observe the economy, and think in the physicist way of saying, “Okay, this is what I see. Let me think of a way of describing it.”