The Allocation of Complexity in Economic Systems
Jason Potts (University of Queensland, Australia), Kate Morrison (Volterra Pacific Pty. Ltd., Australia) and Joseph Clark (University of Queensland, Australia)
Copyright: © 2008
This chapter isolates a classic allocation problem in the substitution relation between two primary carriers of complex rules—agents and institutions—as a function of the relative costs of embedding rules in these carriers, all subject to the constraint of maintaining overall system complexity. We call this generic model the allocation of complexity, which we propose as a bridge between neoclassical and complexity economics.