John Padgett John Padgett

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Economic production as chemistry

John F. Padgett, Doowan Lee and Nick Collier

Inspired by the hypercycle model of the origins of chemical life on earth, this paper develops an autocatalytic model of the co-evolution of economic production and economic firms, represented as skills. The production and distribution of goods by firms are only half of what is accomplished in markets. Firms are produced and transformed, via learning, through goods passing through them. Through means of both agent-based and analytic modeling, this article establishes three principles of social organization that provide sufficient foundations for the unconscious evolution of technological complexity: structured topology, altruistic learning and stigmergy.