Showing papers by "W. Brian Arthur published in 2022"
TL;DR: If economic models based on algorithmic specifications are condensed descriptions of how systems work, the authors can see them as theory proper, just as they see equa-tion-based descriptions as theory Proper.
Abstract: . Standard economic theory uses mathematics as its main means of understanding, and this brings clarity of reasoning and logical power. But there is a drawback: algebraic mathematics restricts economic modeling to what can be expressed only in quantitative nouns, and this forces theory to leave out matters to do with process, formation, adjustment, and creation—matters to do with nonequilibrium. For these we need a different means of understanding, one that allows verbs as well as nouns. Algorithmic expression is such a means. It allows verbs—processes—as well as nouns—objects and quantities. It allows fuller description in economics, and can include heterogeneity of agents, actions as well as objects, and realistic models of behavior in ill-defined situations. The world that algorithms reveal is action-based as well as object-based, or-ganic, possibly ever-changing, and not fully knowable. But it is strangely and wonderfully alive. complicated situation—are theories of such systems. If economic models based on algorithmic specifications are condensed descriptions of how systems work, we can see them as theory proper, just as we see equa-tion-based descriptions as theory proper.
TL;DR: Lindgren constructed a computerized tournament where strategies compete in pairs to play an iterated Prisoner’s Dilemma game where Cooperating, defecting, and retaliating are all possible; you need to choose judiciously if you want to do well.
Abstract: Lindgren constructed a computerized tournament where strategies compete in pairs to play an iterated Prisoner’s Dilemma game. Players play one-againstone 100 times and each time have two options: “cooperate” or “defect.” There’s a tension here. If you and your opponent choose to cooperate you’ll both do quite well. But if you defect you can do better than that. This seems fine, but if your opponent defects as well (and you don’t know in advance what they’ll choose) you will both be harmed. Cooperating, defecting, and retaliating are all possible; you need to choose judiciously if you want to do well.