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Two self-organizing principles in economics and a conflict between them

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Abstract

This paper addresses a theoretical question of two alternative versions of self-organization in socio-economic sciences. The first self-organizing force, spatial resource, is also well known in natural sciences. It is based on motion and interaction of matter in space over time. It was also active in socio-economic processes for many centuries, but was not formally investigated as such a force, apart from regional science literature. The second force is the well-known “invisible hand” of Adam Smith, which was recently transformed into information-financial force. It contains only socio-economic variables that are independent of location. Spatial self-organization also creates solitons (stable evolving spatial structures), which are well known in natural sciences but deserve more investigation by social sciences. Those forces lead to different socio-economic patterns. This creates a conflict between those self-organized forces, which was not studied. Here, it is formulated on both methodological and real levels.

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Notes

  1. There are also special branches, like family economics or public choice, which do not belong to the main core.

  2. The energy crisis starting in 2021 with substantial increases in prices for natural gas and electricity in the EU has resulted in substantial inflation (about 10%) which has not been seen since the oil price increases by OPEC in 1970s.

  3. Here by financial power, I mean free motion of international financial capital, but not physical capital.

  4. In mathematics, gradient of price field, p(x,y), is oriented in the direction of its fastest change.

  5. Such an example was provided by Boglaev, director of production facility in Ural, in his Youtube channel in July 2022. But in some arrangements, like f.o.b. pricing of oil, the transportation is not paid twice.

  6. The invention of a nuclear bomb was a danger, but the parity between USA and USSR prevented the third nuclear war in 1950s–1980s. There still were local conflicts; the main include Korean war 1950–53, Caribbean crisis, wars in Vietnam and Afghanistan.

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Acknowledgements

The author acknowledges constructive comments made by an anonymous referee and by Dr. Christoph Schneider (Economica, Austria).

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    Yuri Yegorov

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Yegorov, Y. Two self-organizing principles in economics and a conflict between them. Evolut Inst Econ Rev 20, 213–233 (2023). https://doi.org/10.1007/s40844-023-00257-9

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