Evolutionary economics at the crossroads of biology and physics

Abstract

For almost a century, evolutionary economics has been based to a significant extent on analogies derived from biology. At the same time, the discipline suffered from lack of analytical rigor. Recently, advances in thermodynamics and information theory have provided a new foundation for evolutionary studies in biology and economics alike. As a result, the body of studies in evolutionary economics that imports concepts from thermodynamics and information theory to develop new analogies is growing. This paper surveys recent trends in evolutionary economics at the crossroads of biology and physics, and argues to supplant analogies derived from either of the two disciplines. Albeit powerful means to crystallize thought about evolutionary processes in economic systems, analogies from biology have tended to plaster over the many differences between biological and economic processes that are essential to economic systems. Similarly, thermodynamics and information theory cannot provide a non-anthropocentric evaluation of economic processes. Yet, the concepts and measures available from physics can be used to improve our understanding of economic evolution if properly placed into the context of socioeconomic processes. The article delineates the realm for non-analogy-based applications of concepts from physics for the assessment of economic processes in light of discontinuities and emergent complexities.