Capacities and feedbacks : the development problem from a complex systems approach

This paper is based on an application of the complex systems approach to economics with the objective of exploring the micro, meso and macroeconomic mechanisms of development. The complex systems approach makes it possible to tackle the problem of evolution and economic development under conditions of temporal and structural irreversibility, path dependence, feedback, externalities and radical uncertainty. This study emphasizes the relevance of feedback effects between the absorption and connectivity capacities and its relationship with processes of structural change, creative destruction and appropriation of quasi-rents in a context of intentional behavior of heterogeneous agents. It shows that capacities and processes interact according to two complex systems properties: self-organization and adaptation, which account for economic development. The paper presents some empirical evidence on the relationship between absorption and connectivity capacities in firms in Argentina. Finally some policy issues derived from the analytical approach of complex systems are shown