Arnold Tustin: Possibility

“Consideration of a further possibility, namely that of constructing physical systems that are analogues of the economic system, and of observing and recording their behaviour.”

Arnold Tustin

Source: The Mechanism of Economic Systems (1953), p. vi

“It is possible that the major collaboration between economists and engineers is still to come, in the greater use of physical analogues and computers of the analogue type to avoid the difficulties of calculation. Apart from their major use as possible tools for economic regulation, physical analogues have a subsidiary use, for there are students of economics, as there are many students of engineering, who can better understand the significance of the somewhat formidable mathematics that tends to be used in this field, if they can first acquaint themselves with the types of behaviour in question as exhibited by physical objects that can be seen, felt, handled and experimented with. It may also be suggested that economists may find that what they have to say about economic policy will be very readily assimilated by one group of attentive pupils, namely the scientists, engineers and technicians of industry, if explanatory notions can be drawn from the theory of automatic control, which is now part of a normal engineering education. The aim of this essay has been to give explanations of system behaviour, and some approaches to its analysis, using geometrical construction and physical analogy where possible to clarify the implications of the more usual formal algebraic approach.”

Arnold Tustin

Source: The Mechanism of Economic Systems (1953), p. 2

Education , Mathematics , Understanding , Question

“The nature of the instability of an unregulated free-enterprise system is only now beginning to be clearly understood. Perhaps the degree of understanding already attained ensures that the grosser shortcomings have gone for ever, and to that extent the conflict between Capitalism and Communism is about issues that belong to the past. It may now be too late. The gods must smile to note how different the state of the world might have been if the progress of economic thought of the last twenty years had been advanced by even ten years.
The possibility of a stable economic life with full utilization of our resources is still not sufficiently assured, and it is extremely important that it should be so assured, and that the whole world should accept this as a fact. The work that is being done in econometrics is massive, and undaunted by mathematical difficulties, but it appears, at any rate as viewed from outside, to be unclear as to its aim.”

Arnold Tustin

Source: The Mechanism of Economic Systems (1953), p. 1

Life , God , World , Smile

“Methods by which engineers stabilise their mechanisms suggest analogous possibilities for stabilising economic systems.”

Arnold Tustin

Arnold Tustin (1957) " The mechanism of economic instability http://books.google.com/books?id=Nou8mkjPMPUC&pg=PA8" in: New Scientist, Oct. 27, 1957. p. 8

“Simulators set up the required system of interdependences, usually between electrical potentials or voltages as variables, by means of valve-amplifiers and electrical networks. Since the voltage across a capacitance is proportional to the integral of a current, that across an inductance to the first derivative of a current, and that across a resistor to the current itself, it is possible to arrange a network of electrical elements, with amplifiers and feeds-back where necessary, so that a given linear differential equation is caused to relate an ’output’ voltage to an ’input’ voltage. Thus a given linear system of interdependences can be simulated, either directly or in any convenient transformation. If non-linear relationships are required there is no universally applicable simple device, but there do exist a great variety of non-linear elements with non-linear characteristics that are known and to some extent; adjustable. These include non-linear resistors… and the characteristic curves of thermionic valves, of rectifiers and discharge vessels and of magnetic materials. Limits may be set by the use of neon tubes that become conducting when a certain voltage is exceeded, or by relays, and so on”

Arnold Tustin

Source: The Mechanism of Economic Systems (1953), p. 128; As cited in: Prices Revalued as Information: Circuit Elements, online document 2013

Universe

“The writer, who as an engineer has spent most of his life in factories, is inclined to look at the basis for investment from a technological point of view… Consider … the class of industrial investments only… The situation is one of entrepreneurs and boards of directors considering, from time to time, various ’possibilities of investment’, such as extra lathes or looms, an extension to a factory, a venture in some completely new product, and so on. It is helpful to think of these ’opportunities for investment’ as existing, in a given situation, in great number and variety, whether they are at that moment under active consideration or not. When any such possibility is considered it is assessed in respect of ’expected profitability’. One may conveniently think of all possibilities of investment as ’quanta’ that can be placed in a schedule of small ranges of expected profitability according to these assessments. The placement of a given ’opportunity for investment’ on this schedule has some ’margin of uncertainty”

Arnold Tustin

a curious analogy with the case of the quanta of physics
Source: The Mechanism of Economic Systems (1953), p. 103; As cited in: Prices Revalued as Information: Circuit Elements, online document 2013

Life , Thinking , Time , Help