Five uncanny rules, results, restrictions, and regularities from complex systems

Bernardo Mueller

Chapter 2 in Handbook on Institutions and Complexity, 2025, pp 23-48 from Edward Elgar Publishing

Abstract: This chapter presents five unexpected findings from complexity theory, showcasing its potential to enhance economic and institutional analysis. Rather than providing a comprehensive overview, it aims to demonstrate complexity theory's unique contributions. The discussion includes three paradigm shifts: from Gaussian to fat-tailed distributions, from rationality-maximizing agents to ultrasociality as a human trait, and from linear predictability to a world of non-linear dynamics and critical tipping points. Additionally, it introduces two key complexity concepts – fitness landscapes and entropy – to economic thinking, illustrating how these ideas can shed new light on the emergence of novelty and the challenges of systemic order. These insights cover just a small part of the diverse set of concepts, models, tools, and perspectives from complex systems theory that appear in this chapter of the Handbook, showing how a complexity approach can enhance our understanding and modeling of economic systems.

Keywords: Complexity; Complex systems; Emergence; Fitness landscapes; Entropy; Spontaneous order (search for similar items in EconPapers)
Date: 2025
ISBN: 9781035309719
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