Beyond Equilibrium and Disequilibrium Economics

The economic discipline moves between two opposite approaches: the orthodox economics of equilibrium and the heterodox economics of disequilibrium. While the complexity of economic phenomena reduces the explanatory power of classical mathematical modelling, attempts at realism imply descriptive analysis. An overlooked aspect is that reality is not random, as the discovery of deterministic chaos within natural and social complex systems confirms. The parts of a system do not add up, but they combine through feed-back relationships, so that the system displays an emergent and self-organizing behaviour that cannot be inferred from that of its parts. This complex behaviour is chaotic, it leads to unregular and perpetual patterns which “form” can be studied using geometric-qualitative analysis instead of the classical one, analytic and deductive. This geometric approach allows to identify harmony rather than (dis)equilibrium as the fundamental property of systems. The dynamics of capitalist systems follows a chaotic complex behaviour marked by cyclical growth, but also threatened by a lack of social harmony. Indeed, social groups interact through power relations giving often raise to drift dynamics (e.g., inequality, depletion of resources, consumerism). The article clarifies these concepts and highlights their potential for economic discipline.