Cognitive Economics: Minds and Markets as Complex Systems

Abstract

This article reviews cognitive economics—an emerging interdisciplinary field that uses the tools of cognitive science to study economic and social decision-making. Despite its eclecticism, Cognitive Economics shares several intellectual commitments: (i) Conceptualizing minds and markets each as complex adaptive systems; (ii) Bridging cognitive, behavioral, and systems levels of analysis; and (iii) Embracing interdisciplinary approaches, including social sciences beyond the traditional scope of cognitive science. We describe three ongoing research programs that strive toward these goals: (i) The study of narratives as a cognitive and social representation used to guide decision-making; (ii) The use of cognitively informed agent based models; and (iii) Understanding markets as an extended mind, analyzed using the concepts, methods, and tools of Coordination Dynamics