The Microeconomics of Complex Economies

1st Edition

Evolutionary, Institutional, Neoclassical, and Complexity Perspectives

Authors: Wolfram Elsner Torsten Heinrich Henning Schwardt
Hardcover ISBN: 9780124115859
eBook ISBN: 9780124115996
Imprint: Academic Press
Published Date: 23rd April 2014
Page Count: 600
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The Microeconomics of Complex Economies uses game theory, modeling approaches, formal techniques, and computer simulations to teach useful, accessible approaches to real modern economies. It covers topics of information and innovation, including national and regional systems of innovation; clustered and networked firms; and open-source/open-innovation production and use. Its final chapter on policy perspectives and decisions confirms the value of the toolset.

Written so chapters can be used independently, the book includes an introduction to computer simulation and pedagogical supplements. Its formal, accessible treatment of complexity goes beyond the scopes of neoclassical and mainstream economics. The highly interdependent economy of the 21st century demands a reconsideration of economic theories.

Key Features

  • Describes the usefulness of complex heterodox economics
  • Emphasizes divergences and convergences with neoclassical economic theories and perspectives
  • Fits easily into courses on intermediate microeconomics, industrial organization, and games through self-contained chapters


Advanced undergraduates and graduate students who have taken a first course in microeconomics.

Table of Contents

  • Dedication
  • Preface: A Complexity Microeconomics, “Post-Crisis”

    • Economics after 2008
    • About This Textbook
    • References
  • Acknowledgments
  • About the Authors
  • Didactics: How to Work with This Textbook at Introductory, Intermediate, and Advanced Levels, and in Different Kinds of Courses

    • Beyond the “Economics of the x”: A Different Task, a Different Style
    • Sample Syllabi: Roadmaps for Teaching in Different Formats
    • Prerequisites for Particular Parts
    • Reference
  • List of Abbreviations
  • Part I: Basics of the Interdependent Economy and Its Processes

    • Chapter 1. Introduction to the Microeconomics of Complex Economies

      • 1.1 Introduction: A Microeconomics of Direct Interdependence
      • 1.2 Different Problem Structures in Directly Interdependent Decision Situations
      • 1.3 Competing Paradigms in Economics: Invisible Hand Versus Fallacy of Aggregation
      • 1.4 Uncertainty, Strategic Uncertainty, and Bounded Rationality
      • 1.5 Path Dependence, Nonergodicity, and Cumulativity in Processes of Change
      • 1.6 Social Rules as Informational and “Expectational” Devices
      • 1.7 Social Rules and Social Institutions as Solutions to Coordination and Dilemma Problems
      • 1.8 The Public Good Character and Positive External Effects of Social Rules and Social Institutions
      • 1.9 “Instrumental” and “Ceremonial” Dimensions of Social Institutions
      • 1.10 Real-World Microeconomics
      • Further Reading
      • Further Reading—Online
    • Chapter 2. Tools I: An Introduction to Game Theory

      • 2.1 Introduction
      • 2.2 Understanding a Strategic Game
      • 2.3 The Invisible Hand and the Fallacy of Aggregation Again
      • 2.4 How Not to Play a Game
      • 2.5 How to Play a Game
      • 2.6 How M


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About the Author

Wolfram Elsner

Wolfram Elsner is professor of economics with the Institute for Institutional and Innovation Economics at the University Bremen in Germany. Before working in academia, he spent ten years as a local development official and state-level planner. He has published widely in various journals, has edited several books, and authored three textbooks. He is the managing editor of the Forum for Social Economics and has served as the President of the European Association for Evolutional Political Economy.

Affiliations and Expertise

Institute for Institutional and Innovation Economics, University of Bremen, Germany

Torsten Heinrich

Affiliations and Expertise

University of Bremen, Germany

Henning Schwardt

Affiliations and Expertise

University of Bremen, Germany


"The Microeconomics of Complex Economies by Wolfram Elsner, Torsten Heinrich and Henning Schwardt is a very well edited, versatile and powerful textbook. It delivers what it ambitiously promises: a pluralist introduction into microeconomics with a focus on social complexity. It can be used in any microeconomic course but it may be analytically too advanced to become a standard textbook. It provides plentiful of exercises for lecturers and students as well as helpful boxes illustrating topical real-world problems. EHS have delivered a grand and unique microeconomic pluralist textbook that deserves highest attention in the economic community."  --Economic Methodology

"This book is a rare attempt to innovate Economics, starting from the way in which this discipline is taught. New approaches pose different questions and require new tools. Yet, the Neoclassical analysis cannot be rejected at this stage (at least because of its diffusion among scholars), and it is not rejected in this book, but it is just a part of the picture. The book is a great example of how to develop a critical approach, and so how to teach students to think on their own."  --Mind and Society

"These chapters will be very useful in showing students the applicability of economic theory to real-world experiences. Thus, the book has a good balance of theoretical analysis and discussions of economic phenomena of everyday life that should provoke students’ interest in economics…. overall, the authors have contributed greatly to bringing heterodox teaching into microeconomics." --Journal of Economic Issues

"[The book] is undoubtedly useful as a manual as it comprises a powerful lot of knowledge and addresses issues that are currently subjects of ongoing research. Therefore, anyone taking the book in their hand will definitely receive a smart picture about where economics comes from, h