Alfred Hubler on Stabilizing CAS
With his permission, I am posting an email thread between myself and Alfred Hubler. I had contacted him on the recommendation of John Miller when Kevin and I were posting on the possibility of dampening boom-bust cycles in the financial markets through policy or other mechanisms. Here’s what Hubler had to say:
I would compare large scale boom-bust cycles to catastrophic forest fires.
- Policy impacts only small forest fires: When small forest fires are suppressed, large forest become possible and, more importantly, the untorched forest changes the local climate and therefore the forest may grow faster and faster. At some point forest fires are potentially so devastating that policy makers have no choice but to suppress them. Eventually the amount combustible reaches a threshold where the forest fire can not be prevented, the catastrophic forest fire takes place, and the cycle starts over.
- Self-adjusting systems suppress catastrophic boom-bust cycles – therefore catastrophic wildfires are rare in un-managed forests: self-adjusting Systems avoid chaos [1,2]. However such adaptation to the edge of chaos occurs only if the system parameters change slowly, compared to the dynamical variables, i.e. if we change policy faster than the period of the boom-bust cycle, then self-adjustment will not suppress them. The good news is, that almost any type of self-adjustment suppresses chaos.
 P. Melby, J. Kaidel, N. Weber, A. Hübler, Adaptation to the Edge of Chaos in the Self-Adjusting Logistic Map, Phys.Rev.Lett 84, 5991-5993 (2000): http://server10.how-why.com/publications/2000/Melby00.pdf
 P. Melby, N. Weber, A. Hübler, Robustness of Adaptation in Controlled Self-Adjusting Chaotic Systems, Phys. Fluctuation and Noise Lett. 2, L285-L292 (2002): http://server10.how-why.com/publications/2002/Melby02.pdf
 T. Wotherspoon and A. Hubler,”Adaption to the Edge of Chaos with Random-Wavelet Feedback” is accepted by the Journal of Physical Chemistry: http://server10.how-why.com/blog/chemical.pdf
In desert oasis, larger, more specialized ants often dominate. Smaller non-specialised ants have smaller populations and competition pushes them to boundary of the oasis. However the small, non-specialised ants species are around for very long periods of time whereas the larger, specialised ant species are often wiped out by a change in climate and catastrophic events. The smaller ants may initially suffer from a catastrophe too, but have a higher likelihood of survival, and even thrive temporarily after the catastrophe, since the competition from the larger ants is gone. The group around Jim Brown, at UNM, did work on ants and we just started work on bacteria colonies in changing environments.
By analogy, I conclude that boom-and-bust cycles are more harmful for larger and more specialised organizations which flourish in a certain environment, and disappear if this environment changes suddenly. A forest fire helps smaller plants and increases diversity.
Yes, chaotic synchronization sounds attractive and I have published many papers on this topic over the past 20 years. It work wells with simple nonlinear oscillators but it does not seem to work with living organisms, such as yeast cells. We do not understand that. Maybe there are adaptive processes or evolutionary advantages suppressing synchronization. For years we tried to entrain the life cycle of cancer cells and yeast cells with heat pulses, microwave pulses and other stimulus, but the cells always escape synchronization.
By analogy, I conclude that it might be difficult to synchronize economic systems.
I’d like to hear your opinions on what this means for policy, regulation, incentive plans, etc.