Understanding economic development means to understand the causal mechanisms working at the social and economic level which produce innovation and sustain competitive advantages.
In the contemporary global economy, local development systems last if they are capable to absorb external and internal shocks (from financial markets, the natural environment, global supply chains, and social, political and technological changes) and to evolve and reproduce themselves. Typically social dynamics such as trust, reputation and cooperation are often the core mechanisms which allow economic development, but they are very fragile and, from a dynamic perspective, very much sensible to shocks. Socio-economic systems thus need to be resilient.
If we want to explain development dynamics and if we aim at having a chance to govern their future we need to integrate knowledge derived from three broad kinds of research, which are the main focus of this blog.
We firstly need to rely on empirical studies in order to understand the regularities and the peculiarities of development, in order to become able to describe the essential features of phenomena and to get suggestions and hypotheses about what is relevant and what is noise.
We secondly have to consider the reactive and proactive behavior of socio-economic agents, either individuals or organizations. Studies in fields such as behavioral, cognitive and neuro sciences are thus fundamental.
Finally, modeling (and in particular agent-based one) is the main means by which we can study the link between individual action and systemic response.