Economic Dynamics, Linearities, and the Classical Mechanistic Worldview

Abstract

Nonlinear economic dynamics may be considered just a collection of models with essentially nonlinear ingredients that require the use of a particular set of (relatively new) mathematical tools. As such, nonlinear economic dynamics has a rank comparable to that of game theory, optimal control, or many other innovations in economic theory made during the last 50 years. However, nonlinear dynamical systems emerging in several fields have never been evaluated only from an exclusive formal point of view. The potential complexity and impredictability of nonlinear dynamical systems have almost immediately initiated a discussion of basic science-theoretic themes. Popular treaties of the subject occasionally talk of a scientific revolution or employ similar spectacular expressions. However, it seems as if in several examples of these inquiries the scientific environment which is supposed to encounter such a revolution is not always described with a sufficient accuracy. The following remarks do not (and cannot, actually) attempt to provide a completely satisfactory account of the origin of economic theorizing and the extend to which nonlinear dynamics might contribute to a change in the attitude toward economic dynamic processes. The sole purpose of the following notes consists in encouraging further reflections on the role of dynamical systems in the modeling of dynamic economic processes.