Economics in nouns and verbs

Author: Arthur, W. Brian
Source: Journal of Economic Behavior & Organization; Vol.: 205; Pp.: 638-647;

DOI: 10.1016/j.jebo.2022.10.036; January 2023

SFI Taxonomy: Models, Tools, and Scientific Visualization (Economics)

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, organic, possibly ever-changing, and not fully knowable. But it is strangely and wonderfully alive.