Law of the jungle: firm survival and price dynamics in evolutionary markets

Markey‐Towler, Brendan

doi:10.1007/s00191-016-0446-8

Cited by 24 publications

(10 citation statements)

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“…One outstanding issue, however, is that evolutionary economics has not yet recovered as compelling a theory of prices from this vision as neoclassical marginalist theories provide. Attention was drawn to this problem by Harry Bloch and Stan Metcalfe at the International Schumpeter Society Conference in 2014 in Jena, sparking my personal interest in the problem of recovering a price theory from evolutionary models (Markey‐Towler, ). I am very glad Professor Bloch has now provided an extended discussion in Schumpeter's Price Theory of his research program addressing this problem (including Bloch, , ; Bloch & Metcalfe, ) which I have followed with some interest.…”

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confidence: 99%

“…Firstly, Professor Bloch does not make explicit use of evolutionary models of differential selection in his formalism, focusing instead more on defining the new theoretical norm for prices in an evolutionary system. There is much work to be done on integrating these with models of differential selection in which price is a core variable (such as Metcalfe, ; Markey‐Towler, ). This promises a theory which is more compelling in terms of its formal specification of the likely path of prices across the economy over time, and its more satisfactory incorporation of the demand side of the economy.…”

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confidence: 99%

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Schumpeter's Price Theory, by HarryBloch (Routledge, Abingdon, 2017), pp. xiii+174.

Markey‐Towler

2018

Economic Record

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confidence: 99%

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Schumpeter's Price Theory, by HarryBloch (Routledge, Abingdon, 2017), pp. xiii+174.

Markey‐Towler

2018

Economic Record

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“… Nelson () provides a comprehensive explanation as to why standard demand and supply analysis is inadequate to deal with movements in price and quantity in the long term because of the operation of economic evolution in complex economic systems. Markey‐Towler () provides a theoretical framework in which the role of prices and their determination can be analysed in evolutionary economic settings. …”

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confidence: 99%

Prior Commitment and Uncertainty in Complex Economic Systems: Reinstating History in the Core of Economic Analysis

Foster

2017

Scottish J Political Eco

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Conventional ‘neoclassical’ economics is very useful in understanding how prices are determined but less so as a general basis for understanding the economic behaviour we observe. What is not taken into account is that economic systems are dissipative structures that are complex, but incompletely connected, networks of rules. It is explained why a degree of prior commitment in decision‐making is inevitable in complex economic systems and the implications of this are examined. It is argued that economic analysis must begin with the reality that choices are made in relation to pre‐existing commitments, both with regard to economic structures built in the past and to prevailing systems of belief, when deciding what to do in a future characterised by uncertainty. It is explained how conventional economic incentives can be dealt with in such a complex historical context building upon the neoclassical perspective of Alfred Marshall over a century ago. It is argued that econometric modelling remains viable and useful in understanding behaviour in complex economic systems. It is shown how we can design and interpret time series econometric modelling from a complex systems perspective.

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“…Economies are incomplete network structures (Potts, 2000) formed by interacting rule-users (Nelson and Winter, 1982;Metcalfe, 1998;Fagerberg, 2003;Hodgson and Knudsen, 2004;Dopfer and Potts, 2007;Witt, 2008;Markey-Towler, 2016). Beyond the origination of novelty Foster, 2005a), the process of evolution is all but equivalent with the process of competition in evolutionary economics (Metcalfe, 1998), competition as "creative destruction", as…”

Section: The Process Of Competition and The Process Of Evolutionmentioning

confidence: 99%

“…They elaborate, the "transfer mechanism" of which Downie (1958) spoke, and which lies at the heart of models of evolutionary economics (Nelson and Winter, 1982;Metcalfe, 1998;Fagerberg, 2003;Hodgson and Knudsen, 2004;Dopfer and Potts, 2007;Witt, 2008;Markey-Towler, 2016). They extend these accounts by extending the basis for competition into the realm of non-price product attributes (of which Kay (1997) has written at length albeit informally).…”

Section: The Lancaster-ironmonger Theorem: the Process Of Competitionmentioning

confidence: 99%

Foundations for Economic Analysis: The Architecture of Socioeconomic Complexity

Markey‐Towler¹

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In this work we develop a general theoretical system for economic analysis. We do so by building a model of the economy as an evolving network formed by the behaviour of individuals responding to their socioeconomic environment on the basis of their psychology. We obtain a vision of the structure and function of economic systems, their architecture, which is integrated, holistic and systematic. This vision expands the range of phenomena economics may explain, while incorporating the insights obtained by prior models within its rubric as special cases of a more general theory.Our vision of the determinants of the structure and function of economic systems is drastically expanded. But unlike many past critiques of the of the narrow vision of economics our model not only stresses the importance of psychological and sociological factors but places them in a definite position and relation in the process of behaviour by which socioeconomic systems are formed and evolve. Psychology and sociology are reintegrated wholesale into economics.Arguably the most valuable contribution of this work comes from a more quotidian focus.A peculiar characteristic of this work is that it places equal interest on the positing of an answer to the question of what connections do not form and why so as to what connections do. In so doing the present work provides an explanation for why economic systems are incomplete, some connections are not made. And in fact, this work pushes yet further to demonstrate that the existence of non-substitutability, even its relative ubiquity, may if originating in the satiation of needs cause it to be so that some connections can't be made. Certain economic structures cannot exist without the removal of certain conditions.The incompleteness of economic systems we thus come to appreciate allows them to evolve and our inquiries in this regard lead us to develop an account of the structural evolution of economic systems as yet unobtained within evolutionary economics. We will arrive at a revelation of the process of structural evolution as the transfer of connections facilitated by competition which exploits substitutability where it exists. We obtain a new, formal vantage point on the progression of socioeconomic history. Declaration by author AcknowledgementsIn a few pages I will tell a lie: this work is my own. I wrote it to be sure. I read the material which contributed to it, I developed the mathematics, I derived the theorems, I had the will to keep at it even while the signals from all but one quarter were that it was hopeless. But this is as much the work of John Foster, Peter Earl and Michelle Baddeley as it is my own. More so in fact. A bloated wastrel in form, yet in content a gaunt, wasted shade of the present work would be in the hands of you, the reader, were it not for the counsel of these three great minds. Without Michelle Baddeley, this work does not exist. Period. Without her believing in the strength of my intellect sufficiently to bring me to University College London for four mon...

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Law of the jungle: firm survival and price dynamics in evolutionary markets

Cited by 24 publications

References 52 publications

Schumpeter's Price Theory, by HarryBloch (Routledge, Abingdon, 2017), pp. xiii+174.

Schumpeter's Price Theory, by HarryBloch (Routledge, Abingdon, 2017), pp. xiii+174.

Prior Commitment and Uncertainty in Complex Economic Systems: Reinstating History in the Core of Economic Analysis

Foundations for Economic Analysis: The Architecture of Socioeconomic Complexity

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