THE ECONOMY AS AN EVOLVING NETWORK

The purpose of this paper is to suggest a view of the economy as a net work of links between the individuals involved. One approach is to con sider the structure of links as fixed as is the case with spatial mode ls in which agents are situated on a lattice, another is to regard all links as possible but stochastic. If the probability of any of the li nks existing is uniform we have the situation familiar from the ''popu lation games'' of evolutionary game theory. The basic idea here is to allow the network to evolve and to make the probability of each of the links dependent on the experience of the agents involved. Such analys is can give rise to interesting behaviour on the aggregate level which is very different from that which might have been predicted by lookin g at the individuals in isolation.