What Computer Science Can Teach Economics

Posted by ScuttleMonkey on Monday November 9, 2009 @10:12AM from the just-build-better-computers dept.

eldavojohn writes "A new award-winning thesis from an MIT computer science assistant professor showed that the Nash equilibrium of complex games (like the economy or poker) belong to problems with non-deterministic polynomial (NP) complexity (more specifically PPAD complexity, a subset of TFNP problems which is a subset of FNP problems which is a subset of NP problems). More importantly there should be a single solution for one problem that can be adapted to fit all the other problems. Meaning if you can generalize the solution to poker, you have the ability to discover the Nash equilibrium of the economy. Some computer scientists are calling this the biggest development in game theory in a decade."

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another intersection of CS and econ by WhiteDragon · 2009-11-09 10:23 · Score: 5, Interesting

Here's a proof that detecting "toxic assets" is impossible (or at least NP)

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Did you mount a military-grade, variable-focus MASER on an unlicensed artificial intelligence?
Re:The problem is not an efficient algorithm by gerddie · 2009-11-09 10:41 · Score: 4, Interesting

Well, I'm not surprised there is such school. My impression is, that economists in general don't have a good grasp of math, specifically, they don't seem to understand the exponential function, otherwise they would not speak of "growth" all the time.
I'm not saying one should not take human behavior into account, but at least they should get the boundary conditions right, and one of those is that our resources are limited.