ABSTRACT
Introduction It is now widely acknowledged that the “perfect storm” which followed the bankruptcy of Lehman Brothers on September 15, 2008 not only caused the worst recession developed economies have ever seen since the Great Depression, but it also brought about a deep crisis for economic theory (Colander et al., 2009; Farmer and Foley, 2009; Krugman, 2009, 2011; Caballero, 2010; Kirman, 2010, 2016; DeLong, 2011; Kay, 2011; Stiglitz, 2011, 2015; Dosi, 2012). Indeed, as we have argued at length in Chapter 9, the basic assumptions of mainstream dynamic stochastic general equilibrium (DSGE) models, the predominant theoretical frameworks in macroeconomics nowadays, prevent the understanding of basic phenomena underlying the current economic crisis and, more generally, macroeconomic dynamics. There, we have suggested that a more fruitful research avenue should escape the strong theoretical requirements of DSGE models (e.g., equilibrium, rationality, representative agent) and consider economies as complex evolving systems (more on that in Farmer and Foley, 2009; Kirman, 2010, 2016; Rosser, 2011; Dosi, 2012; Battiston et al., 2016). This implies thinking of economies as ecologies populated by heterogeneous agents, whose far-fromequilibrium interactions continuously change the structure of the system.
