Computation as economics

✍ Scribed by Bernardo A. Huberman

• Book ID: 104293585
• Publisher: Elsevier Science
• Year: 1998
• Tongue: English
• Weight: 366 KB
• Volume: 22
• Category: Article
• ISSN: 0165-1889
• DOI: 10.1016/s0165-1889(98)00008-6

✦ Synopsis

We use computers to study economics, but few people realize that we can use economics to study and design computational systems. The reason is that computer networks can be regarded as a community of processes that in their interactions, strategies and lack of perfect knowledge face the same issues as people in markets. This paper describes how computers have evolved to a point where economics approaches are useful for designing them and understanding their dynamics. Examples are given of existing computer systems that use market mechanisms and of novel phenomena, such as clustered volatility, that we uncovered when studying their evolution.