Patterns in the Dark: Understanding Risk and Financial Crisis with Complexity Theory

Product Details

A groundbreaking look at complexity theory and its implications in the world of finance
Complexity theory tells us that processes with a large number of seemingly independent agents-such as free markets-can spontaneously organize themselves into a coherent system. In this fascinating book, Edgar Peters brings together scientific theory, the artistic process, and economics to show how the randomness and uncertainty of complexity theory can be applied to financial markets. Written in an engaging and accessible style, this is a thoughtful, conceptual look at the way free markets are, by their nature, continually evolving complex systems. Expanding on previous explorations of chaos theory, Peters draws on real-life examples ranging from the Asian crisis to America's love of conspiracy to show that complexity and randomness are necessary for the free markets to operate in a competitive manner.

Customer Reviews ::

i loved this chaos theory intoduction - C. M. Butler - United States
I'm not a math gueek, evolutionist, or statistician. What I wanted was someone to expalain, in as simple terms as possible, what "complexity" is in terms of systems analysis - be that social, economic or otherwise. Kudos to Peters for delivering just that. I read the negative reviews written before my own, considered them, and then I bought the book anyway.

Frankly, I'm glad Peters "dumbed down" this topic for me. That's what I wanted. Not knowing much about the subject, I was still able to sense where some errors of omission were being made. And there are a few. I wish he would have finished his thought on the Monte Hall problem, for example. Don't buy this book if you are thinking it's full of exciting mathematical equations or advanced theory. It isn't. It's just an introduction to complex/chaotic systems written for the average Joe/Jane.

For all the flap over "missing Keynes' contribution" or "misrepresenting Darwin," he may very well do that. I did not buy this book expecting Peters to be a Keynes scholar or a Darwinian evolutionist. If he has read 0 Keynes and 0 Darwin, I think we can still consider him an expert on complex and chaotic systems. Certainly, Keynes and Darwin were not. I expected that Peters might know a little bit about chaos theory and complexity as it relates to the realm of economics. And that he does. So, again, kudos to Mr. Peters for dumbing down this complex topic (pun intended) enough to create a starting point for me.

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