Virtually all economic models of social interaction, including through markets, assumes that outcomes reflect a system that is “in equilibrium.” Equilibrium restrictions are used to interpret historical data from the field and advise policy makers such as central bankers. But absent an economic law of “entropy,” it is by far a foregone conclusion that economic systems equilibrate. Since the 1960s, controlled experiments have been run to evaluate under what conditions equilibrium really emerges, and if not, what the reasons could be.
Leverhulme International Professorship in Neuroeconomics at the University of Cambridge Faculty of Economics
