An exemplified description of Systems Dynamics:
Small events can have large consequences

Nipawin - Saturday - January 11, 2003 - by: Mario deSantis


Life is a process of discovery and as I am reading the book "The Art of Systems Thinking" so many thoughts and diversions take me away from this book. For example, this morning as I was reading chapter 4 when I came across the notion that in dealing with the reality of complex systems (also known as chaos), just like our social and economic systems, 'small events can have large consequences.' This thought of small events reminded me of accountant Daryl Halbert who in the mid 80ies would attend my different computerized accounting courses in Brooks, Alberta, even though his understanding of computerized accounting was extremely sophisticated. Once I saw Daryl again at the end of my first lecture of yet another course I asked him "What are you doing here, you took so many courses already with me?" And Daryl answered "It is enough that I can get just an idea from this course and I will be happy, and I have already got a new idea from you?"




Yes, small events are important, and out of curiosity I just happened to navigate on the Internet and visit the web page LogEc where you can read and download economic papers from all over the world. The paper about the "Death of Neoclassical Economics" got my attention and as I casually read it I realized how contemporary I have been in my past writings in rebuffing conventional economists and conventional governmental public policies.



game theory

In his paper, professor David Collander concludes that economics is becoming more and more practical modeling, and that economic theories are taking two complementary directions: the first direction is the development of a general equilibrium theory based on the evolutionary game theory, the second direction is found in the work of complexity theorists who find the simplicity of our economic relationships in the study of dynamics and iterative processes.




At this point I have a soft sense of satisfaction as I already expressed my reservation about the aggressive approach of game theory and as I am following the more cooperative approach of System Dynamics (really another term for Systems Thinking). Therefore, I look at the challenges of deepening my interest in System Dynamics and understand better a new needed social perspective to being able to solve our economic problems.

Mario deSantis

  Editor's note: Mario deSantis taught at Medicine Hat College, Brooks Campus, in the 1980s
Other References:  
  The Art of Systems Thinking: Essential Skills for Creativity and Problem Solving by Joseph O'Connor, Ian McDermott, 1997 Thorsons
  Collander, David, Death of Neoclassical Economics, (pdf) July 2002, MIDDLEBURY COLLEGE ECONOMICS DISCUSSION PAPER NO. 02-37
  deSantis, Mario, The societal implications of the work of scientists John Nash, Thomas Saaty and Jay Forrester:Game Theory versus System Dynamics, July 27, 2002, Ensign
  Lienhard, John, The Butterfly Effect, Engines of our ingenuity


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