Australian Centre for Commercial Mathematics

I recently blogged about the need for a National Centre for Complexity Economics.

I said the centre should be in an institution with a mathematics department and an IT department able to support it.

Today I became aware of the Australian Centre for Commercial Mathematics, whose "mission is to conduct projects with industry to solve complex problems using advanced mathematics and statistics." It only commenced in January this year so it hasn't taken me too long to discover it.

The centre itself is based on the success over the last thre years of the Australian Research Council Centre of Excellence for Mathematics and Statistics of Complex Systems (MASCOS. This is certainly the right mathematics facility to support the complexity economics work.

The School of Economics at UNSW houses both the Economic Design Network (EDN) and the The Society of Heterodox Economists (SHE).

The EDN supports research and scholarship in economic theory and experimental economics, and in its application to the design of economic policy. They claim;

By encouraging interdisciplinary research and policy innovation, using state of the art techniques in economic theory and experimental economics, it will create practical tools that can be used to solve complex social and economic problems.

By linking Australasian researchers into multidisciplinary teams and networks involving some of the best scholars and centres for economic theory and experimental economics around the world, it will also build on our strengths and help us to create a world class economic design capacity in the region.

SHE represents a collaboration of economists outside the mainstream. Annual conferences, workshops, a working paper series and a virtual forum are also coordinated by SHE.

These two together offer the potential for the development of a centre for complexity economics.

I should note that my earlier post didn't adequately deal with my equivalent for economics of the unified field theory in physics. I touched on some of it on my post about John Quiggin's lecture.

The argument proceeds simply;
1. Neo-classical economics is inadequate as science as its assumptions (especially methodological individualism and methodological equilibriation) do not fit most real world circumstances.
2. Behavioural economics and institutional economics are both attempts to understand economic behaviour as systems - in a way, where do the preferences of individuals come from.
3. Evolutionary economics and economic dynamics attempt to deal with the fact that economic systems are, in reality, seldom in an equilibrium state.
4. The fact that the neo-classicists force economic problems to be tractable as constrained optimisation problems doesn't mean the use of mathematics is wrong, it is just the wrong mathematics.
5. If we posit that preferences are formed by experience of previous market transactions and that the question to study is how changes occur not what happens at "equilibrium" then the mathematics to be applied is the mathematics of complexity.

Finally, I draw a distinction between economic science and political economy that builds on John Neville Keynes original distinction between positive economics, normative economics and the art of economics. For me the latter is a separation of the issue into the three fields - economic science which describes how agents react to actions of other agents in economic affairs, ethics which is what our policy goals are (we should promote equity or we should promote efficiency) which are combined to create the kind of political economy practiced by Adam Smith - advocating policy positions.

I fully acknowledge the claim that many political economists would make that "economic science" is almost never practiced as it claims to be. I would however further assert that other aspects that appear in heterodox economics are either specific examples of institutions (more specifically the way that power is exerted to create preferences) or contentions about unstated ethical goals.







Novae Meridianae Demetae Dexter delenda est

Mathematics Teaching

We know there is a crisis in mathematics education in Australia. But what is being done about it?

This item from The Conversation suggests we are going to make it worse because teaching and learning professionals want to make a post-degree education qualification two-years.

Meanwhile the ALP went to the last federal election with a program called Teach Next promising to extend its fast-track process being trialled in Victoria to the rest of the country. Other states like NSW have tried to "convert" non-mathematics graduates into maths teachers.

As a mathematics graduate I sometimes wonder whether I shouldn't retrain and go forth and teach. The challenge for me is I really don't know if I could be any good at it. I could teach motivated students - but could I motivate the disinterested?

My sense is that mathematicians considering teaching are more likely to be attracted by the kind of "on-the=job" training that the Gillard government proposed.

A good question for an education reporter right now would be to ask the Feds what they are doing.

Novae Meridianae Demetae Dexter delenda est

A grab-bag

Firstly from The Conversation one for the maths nerds. A simple description of the P vs NP problem which hinges on the question of difficulty...and is worth a read if you want to understand something of the limits of mathematics.

I could add at this point the fact that this problem is one that could be used by heterodox economists against mathematics - that once you make the economic model sufficiently detailed to be useful it becomes a "difficult" problem and it is easier to simply check the answers provided through verbal reasoning.

Alan Knight writing for the National Times echoes my conclusion that Sky News can't be allowed anywhere near the Australian Network.

Hawker Brittan's Justin di Lollo raises an important question about the regulation of lobbyists. Lobbyists are defined in regulation to exclude in-house lobbyists, other professions that might meet with government officials and representatives of industry associations.

The problem is that it is really hard to define who in a firm is actually a lobbyist, since we will send all kinds of managers into meetings with government.

Personally I think the law change in NSW proposed by Barry O'Farrell to exclude lobbyists as a class from appointment to Boards etc is the error. But on the more general question of transparency of lobbying activity the simplest thing would be to simply make the appointment schedules of Ministers, their staff and senior officials public. This could be limited to appointments and calls initiated by the external party so as not to hinder Government's ability to be informed.

The perhaps wackiest of the lot today is Tony Abbott's claim that the carbon tax won't pass the Parliament as ALP members will rat.

Ratting like that is permanent - not one off. These would be people casting their lot to bring down an ALP Government in the hope of retaining their seat. History has shown the electorate can be very unforgiving of the rat. So far the ALP has been solid in denying the story.

But as a problem the issue facing all MPs right now has a touch of the "P vs NP" problem. How difficult is it to respond to climate change in a way that is effective and can bring the public along? Gillard and co have taken the neo-classical approach of using the price mechanism, Abbott wants direct action...the centralist/statist approach.

Novae Meridianae Demetae Dexter delenda est