4/4/2000
The beating of a butterfly's wings in Japan, says a popular
idea from chaos theory, can, in principle, spark an avalanche on even the
mightiest Alpine peak. It's that interconnected nature of things that interests
Ormerod, head of the Economic Assessment Unit at The Economist, who
expands here upon themes he presented, to some controversy, in his 1994 book The
Death of Economics. Orthodox economics, says Ormerod, the kind that views
the world as a machine with clear actions that beget clear reactions, needs to
be re-examined. He applies his view of society as a living creature to the
workings of the marketplace and other aspects of human life.
"Conventional economics is mistaken," says Ormerod, "when it views
the economy and society as a machine, whose behavior, no matter how complicated,
is ultimately predictable and controllable."