Given that farming was not invented by Homo sapiens until what we term the agricultural revolution of about 10,000 years ago, how could simple creatures like ants have been doing something similar for millions of years? Complex systems like the brain or an ant colony are called adaptive complex systems. They are distinguished from ordinary complex

chaotic behavior changes and becomes more turbulent as the number of degrees of freedom increases.

Complexity-economics models, in contrast, do not necessarily assume equilibrium, but regard it as an emergent property when it happens.

The big question we pondered more than all others was the mystery of self-organization: How can disorganized configurations of matter spontaneously become organized?

Standard economics usually assumes forward-looking agents who are intelligent enough to reason their way through any problem. These hypothetical rational agents are a bit like Star Trek’s Mr Spock: They use all available information to make the best possible decision – the one that yields highest utility.

In 1978, when we began our research, the prevailing theory was that turbulence happened because ‘things are really complicated’. Lorenz proposed the alternate theory that turbulence is caused by chaos. Though

The financial crisis of 2008 is a good example where this leads to problems.14 All the models at the time ignored the possibility that homeowners and businesses might default on their loans. Economists knew that default was important, but including it in their models was difficult, so they left it out.

There are many advantages to using simulations rather than mathematical equations, but one of the most important is the ability to model the diversity of the actors in the world – what economists call heterogeneity.12 Modeling heterogeneity is a hot topic in mainstream macroeconomics, but it is very hard to fit this into the standard framework. Com

We are now developing agent-based economic models at the level of individual firms and households that can use such data. These models study the economy from the bottom up: Macroeconomics emerges from microeconomics.