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Content archived on 2024-05-14

Decentralized economies and the theory of complexity

Objective



We consider the fundamental theoretical problem of economic coordination in a decentralized economy. As the recent empirical evidence pertaining to Eastern Europe suggests, decentralised trade entails deep questions that economic theory does not yet offer an answer to. The central problems with which economic theory is concerned remained the same since Smith (1776): How, why, and when does the 'invisible hand' work? As a decentralised economy consists of a large number of locally interconnected and interacting rational agents, who are all continuously pursuing advantageous opportunities, these questions may very well be studied in the framework of the theory of complexity. The complexity approach takes as given simple microeconomic properties, and tries to understand how the macroeconomic dynamics (both short-term and long-term) of a decentralized economy can be the aggregate result of the process of interactions between many of such individual agents.

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Programme(s)

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Topic(s)

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Funding Scheme

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RGI - Research grants (individual fellowships)

Coordinator

UNIVERSITAT POMPEU FABRA
EU contribution
No data
Address
25-27,Ramon Trias Fargas 25-27
08005 BARCELONA
Spain

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Total cost

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Participants (1)

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