Stanford EE Computer Systems Colloquium
4:15PM, Wednesday, Mar 3, 2010
HP Auditorium, Gates Computer Science Building B01
Economic Webs and The Evolution of Wealth
About the talk:
Finnish Distinguished Professor
Signal Processing Departments
Tampere University of Technology
University of Vermont
Departments of Biochemistry and Mathematics
Economic growth theory considers aggregates such as GDP, and has tended to ignore the specific structure and productive competencies in an economy with respect to its capacity for growth. In the past 50,000 years, the diversity of goods and services has grown from perhaps 1000 to billions. The diversity of production capacities has grown vastly as well.
An economic web is a bipartite graph consisting of goods as nodes and production capacities as boxes. Factors that are inputs to production of a product (node), are denoted by arrows from the input factor nodes to the box, and arrows out to one or all product nodes.
I will discuss three major topics:
- As the diversity (number) of production capacities increase on
one axis, and the number of goods that can serve as input factors
increase on a second axis, a roughly hyperbolic curve in this space
separates a subcritical from a supracritical economy. The former
cannot generate an increasing diversity of goods, from a supracritical
economy that can generate an increasing diversity of goods and novel
production capacities. Alberta Canada is subcritical, exporting wood,
oil, wheat and beef. Ethiopia is subcritical, exporting coffee. The
global economy is supracritical. Transition to supracritical behavior
is an essential feature of economic growth.
- There are knowledge spillovers, as is well known, from production
of one product to those that are similar. R. Hausmann has mapped this
in some detail. A high diversity of production capacities suggests
ease of combining these to produce new goods.
- It is a fundamental fact that we cannot finitely prestate the goods
and services that will emerge in an evolving economy, just as we cannot
finitely prestate what adaptations may occur in biological evolution
by Darwinian exaptations. We cannot make probability statements
here because we do not know the sample space. No law can be had for
this unfolding. Therefore in the real economy, not only do we not
know what WILL happen, we do not even know what CAN happen. All the
above have major implications about fostering economic growth, and
policy formation, when governments want milestones that cannot be
set with respect to goods whose possibilities cannot be foreseen.
There is no downloadable version of the slides
for this talk available at this time.
About the speaker:
Stuart Alan Kauffman (28 September 1939) is an American theoretical
biologist and complex systems researcher concerning the origin of life
on Earth. He is best known for arguing that the complexity of biological
systems and organisms might result as much from self-organization and
far-from-equilibrium dynamics as from Darwinian natural selection, as well
as for applying models of Boolean networks to simplified genetic circuits.
Kauffman rose to prominence through his association with the Santa Fe Institute (a non-profit research institute dedicated to the study of complex systems), where he was faculty in residence from 1986 to 1997, and through his work on models in various areas of biology.
[extracted from Wikipedia]