Keynes , Hayek , and the Roots of Complexity Theory in Economics
writing about how the creation of money altered the behavior of agents and organizations ( Rosser , 2015 ). The theme of downward causation cannot be disregarded when reflecting that throughout history there are instances when states that win wars are positioned to decide the legitimate order for other states and , in certain rare cases , might change the order or ecology in which those states exist . It is this process that explains the conflict between the United States and China , as each nation tries to influence the world around it in a way that ensures its own survival .
( 9 ) The later Hayek expressed ideas about cultural evolution that are often misconstrued and criticized , incorrectly , on the grounds that he presumed that evolution through self-organization is a process that produces
Bounded rationality , dispersed knowledge , self-organization , cognitive limitations , ecologies with no central controller — these ideas that are central concerns of Hayek are also core premises of complexity approaches in economics . These were all ideas that were derived from his belief that the market economy is an information-increasing algorithm in which spontaneous order arises from the independent action of market participants , through the coordination made possible by prices . Hayek ’ s foundational contributions to economic reasoning can stand on their own , as distinct from assumption that is attributed to him , that all forms governmental activism will inevitably end in a loss of freedom for the individual ( Bowles , Kirman , & Sethi , 2017 ).
A Tangled Global Web and Hayekian Epistemology
In Hayek ’ s thinking about the relationships between spontaneous order and emergence , he understood implicitly that tangled networks of human interaction foster heterogeneity and thereby create new opportunities for novelty , innovation , and entrepreneurship , and that the heterogeneity would bring more risk and conflict . Nevertheless , his own research did not explore the tangled webs of relationships found in complex global ecologies . Advances in evolutionary biology and network theory that explore tangled ecologies and their properties occurred primarily after Hayek had completed most of his life ’ s work .
The Road to Serfdom , for example , is a study of contemporary politics in 1944 , when the enemies of liberty were heterogeneous , but self-declared . Threats to individual liberty could be readily identified during the long war between liberalism , socialism , and fascism that ended with the collapse of the Soviet Union . Today , however , when many capitalist societies are mixed regimes and former socialist regimes are
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