Sublime

here: these very actions of agents’ exploring, changing, adapting, and experimenting further change the outcome, and they’d have to then re-adapt and re-adjust.

Scientific models that seek to predict the consequences of human actions with some reasonable accuracy—such as game theoretical models of economic behavior—for the most part ignore human individuality in favor of aggregated outcomes.

Markets are therefore called “emergent” systems: prices emerge from all members’ interactions and can’t be observed just by looking at a few.

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.

network effects (the more good investment algorithms it holds, the more capital it will attract; the more capital it holds, the more algo traders it will attract),

they experiment, they explore, they adjust, they readjust, but not just in terms of having some wondrous mathematical model of the situation and updating a parameter. They form a hypothesis, maybe they have multiple hypotheses or ideas about the situation they are in, and they put more belief in the ones that work over time and throw out hypotheses

Mathematicians call this phenomenon the emergence of a giant component, one that includes a large fraction of all nodes. Physicists call it percolation and will tell you that we just witnessed a phase transition, similar to the moment in which water freezes. Sociologists would tell you that your subjects had just formed a community. Though

The big advantage of physicists—I think Doyne Farmer may have once said this to me—is not what they have learned, the tools. It’s how they have learned to think. In particular, physicists are quite good at being very, very broad, taking tools from all over the place. That is something that economists are very, very remiss in. It is a b—tch to try t

You know, we all have a much broader set of purposes in our life and this ties more closely to the Aristotelian philosophy of eudaimonia, of human flourishing, of the idea of the good life as having multiple dimensions to it, including social connections, purpose, being able to contribute to society, dignity, respect, not the narrow Benthamite, uti