ABSTRACT
This chapter presents two simple alternatives when approaching the study of how economies function: the 'standard' approach adopted within mainstream economics, in which the economy is pictured as behaving like a single, very sophisticated individual; and the 'complex systems' approach, in which individuals are thought of as interacting with each other on the basis of simple rules, in such a way so as to produce often complicated aggregate behaviour, not directly deducible from individual behaviour taken in isolation. One of the key differences between these two approaches is in the importance attributed to 'equilibrium'. The analysis of such equilibrium states is a defining preoccupation of the standard approach. The chapter briefly examines some of the problems with the standard approach and argues that the complexity vision offers a more realistic and useful alternative. It argues that the vision of the economy conveyed by standard models, particularly macroeconomic models, does not give an adequate account of how the economic system evolves.
