What I've Been Reading

In non linear systems-and the economy is most certainly nonlinear-chaos theory tells you that the slightest uncertainty in your knowledge of the initial conditions will often grow inexorably. After a while, your predictions are nonsense.

Complexity: The Emerging Science at the Edge of Order and Chaos by M. Mitchell Waldrop. I read this book last summer but was thinking for past four months on what to write. Still date, I have no idea how to summarize the importance of this book.

This is an unofficial biography of Santa Fe Institute - I learned so much from this book that it will me many life times to work on those ideas. This is one book, I have to re-read every few years.

“Here was this elusive "Santa Fe approach": Instead of emphasizing decreasing returns, static equilibrium, and perfect rationality, as in the neoclassical view, the Santa Fe team would emphasize increasing returns, bounded rationality, and the dynamics of evolution and learning. Instead of basing their theory on assumptions that were mathematically convenient, they would try to make models that were psychologically realistic. Instead of viewing the economy as some kind of Newtonian machine, they would see it as something organic, adaptive, surprising, and alive. Instead of talking about the world as if it were a static thing buried deep in the frozen regime, as Chris Langton might have put it, they would learn how to think about the world as a dynamic, ever-changing system poised at the edge of chaos.”