Stan Metcalfe

Evolution and economic complexity: an overview

The articles in this special issue are based upon a selection of papers presented at the ‘Brisbane Club’ section of the 2007 STOREP Conference. We provide introductory reviews of these articles and briefly assess their contributions to the advancement of our understanding of economic evolution, and the associated process of innovation. In particular, we discuss why it is necessary to adopt a complex systems perspective, which deals explicitly with the creation and transmission of new knowledge, as the analytical foundation of evolutionary economic modelling.

Complexity in the Theory of the Developing Firm

This comprehensive and innovative Handbook applies the tools of the economics of complexity to analyse the causes and effects of technological and structural change. It grafts the intuitions of the economics of complexity into the tradition of analysis based upon the Schumpeterian and Marshallian legacies.

Compound Learning, Neural Nets And The Competitive Process

In this paper we try to assess the potential application of neural networks as a modelling tool for complex evolutionary processes. The concept that we wish to investigate is the one of compound learning, that is the fact that, in a complex environment, what and how much economic entities learn depends upon what has been learnt in other entities in an interactive fashion. Our application consists of a stylised environment in which two firms learn how to innovate their product and to sell it on a market which learns how to evaluate the product which is being supplied. We seek to demonstrate that what matters for competitive advantage is not the absolute value of learning capability but the differential learning capability between the competing firms and between the firms and the market. Another appealing way to see it is that the chance for one of the two firms to gain competitive advantage is not unlimited but is constrained by own learning capability and the learning capability of the market.

Restless Knowledge, Capabilities and the Nature of the Mega-Firm

An evolutionary approach to economics recognises that the economy is an open system subject to change from within. One important evolutionary feature is the emergence of dominant firms in many important sectors of the global economy. We argue that these firms have distinguishing characteristics that contribute to their evolutionary fitness and have powerful impact on the process of innovation. We designate these firms as mega-firms.

Technology and policy in cable TV development in the UK

Although cable TV is often viewed in an entertainment context, its importance for technology policy rests with its relation to future national broadband network development. The authors argue that it could provide a means of assessing the benefits and technical direction of this greater project and government support for early cable ventures is advised for this purpose. Government policy should stress incremental technical advance and address the development problems likely to be encountered by cable TV as an infant technology.