Brian Arthur – Complexity and the Economy

 

What happens at these deeper levels? Human decision makers do not back off from a problem because it is difficult or unspecified. We might say that when problems are too complicated to afford solutions or when they are not well- specified, agents face not a problem but a situation. They must deal with that situation; they must frame the problem, and that framing in many ways is the most important part of the decision process. To consider that framing you have to consider what lies between the problem and the action taken. And between the problem and the action lies cognition. Be- tween the problem and the solution there’s a lot going on, and if one considers what is going on, economics becomes difficult. To paraphrase my question then: How do people make sense of a problem? How do individuals handle these more complicated problems? How do we really cognize?

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