Forecast: What Physics, Meteorology, and the Natural Sciences Can Teach Us About Economics
Buchanan, physicist and science writer, argues that scientific models of positive feedbacks can be used in economics and finance to predict what is likely and to warn of specific dangers. Positive feedbacks are . . . the process by which small variations in a given system can become increasingly large . . . accelerating how fast things get bigger and leading to consequences far beyond our expectations. We learn most economists continue to believe in the concept of equilibrium—economic systems are inherently stable and self-regulating, tending toward balance; the author urges adopting disequilibrium thinking, which has shown us that ongoing fluctuations in economic and financial systems are quite normal. Buchanan argues that financial crises of all kinds, from short shocks to global economic meltdowns, are like storms in the atmosphere that weather forecasters not only understand . . . but also predict well enough to make a big difference. The use of this scientific approach began after the 2008 financial crisis. This challenging book will appeal to students and library patrons with a background in economics and finance. --Mary Whaley