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Systemic failure in macroeconomic modelling

Reynolds, Martin (2014). Systemic failure in macroeconomic modelling. International Journal of Applied Systemic Studies, 5(4) pp. 311–328.

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DOI (Digital Object Identifier) Link: https://doi.org/10.1504/IJASS.2014.065695
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Abstract

Terms like systemic crisis and systemic failure are used with increasing frequency particularly by journalists, politicians, as well as academics, to account for things going wrong in an increasingly complex and uncertain world. But what does systemic failure actually mean from a systems thinking perspective, and how might more effective thinking reduce incidences of systemic failure? This paper argues that three interwoven traps of modelling contribute as a confluence towards systemic failure - reductionism, dogmatism, and managerialism. Using the example of systemic failure of academic economics in averting the global financial crisis – as expressed by prominent economists themselves - each of the three traps is explored. The confluence of these traps working together are illustrated by the ideas from a tradition of critical systems thinking associated with systemic triangulation, and ideas from the science of political economy associated with the ‘iron triangle’. Some practical tools from systems approaches are suggested to counter traps of systemic failure using a suggested heuristic of systems thinking in practice.

Item Type: Journal Item
Copyright Holders: 2014 Martin Reynolds, Inderscience Enterprises Ltd
ISSN: 1751-0597
Extra Information: This Paper is a revised and expanded version of a Keynote address to the 8th National and International Conference (5-7 July 2012) of the Hellenic Society for Systemic Studies (HSSS) on 7th July 2012 in
Thessoloniki, Greece.
Keywords: critical systems thinking; dogmatism; iron triangle; managerialism; reductionism; systemic failure; systemic triangulation; systems thinking in practice
Academic Unit/School: Faculty of Science, Technology, Engineering and Mathematics (STEM) > Engineering and Innovation
Faculty of Science, Technology, Engineering and Mathematics (STEM)
Interdisciplinary Research Centre: Innovation, Knowledge & Development research centre (IKD)
Design and Innovation
Related URLs:
Item ID: 41201
Depositing User: Martin Reynolds
Date Deposited: 05 Nov 2014 15:01
Last Modified: 23 Mar 2017 19:03
URI: http://oro.open.ac.uk/id/eprint/41201
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