I’ve been involved in using computers for a fair while now, and I’ve always found the history of how it all evolved interesting. Today, while looking around at the New York Times Web site, I came across a post on “The Wild Side” blog, by guest blogger Steven Strogatz (a professor of applied mathematics at Cornell), about an old hydraulic analog computer that was built in 1949 at the London School of Economics to simulate the workings of the economy. Although 14 of these machines were built, only two are still in working order. One, at Cambridge University in England, was demonstrated to Prof. Strogatz by Cambridge engineering Prof. Allan McRobie. (There is also a video of a demonstration available, which can be viewed online or downloaded.)
In the front right corner, in a structure that resembles a large cupboard with a transparent front, stands a Rube Goldberg collection of tubes, tanks, valves, pumps and sluices. You could think of it as a hydraulic computer. Water flows through a series of clear pipes, mimicking the way that money flows through the economy.
Seeing a bit of how the thing works is fascinating. It’s particularly interesting to see, in the demonstration, how the machine can model non-linear functions by using appropriately curved parts. My first reaction was that it was sort of a cross between a high-school science fair project and Rube Goldberg, but as Prof. Strogatz points out, it does have some direct applicability today:
Though it’s tempting to view the Phillips machine as a relic of a bygone era, in one way it’s just the opposite; there’s something about it as fresh as the day it began gurgling. Look at its plumbing diagram. It’s a network of dynamic feedback loops. In this sense the Phillips machine foreshadowed one of the most central challenges in science today: the quest to decipher and control the complex, interconnected systems that pervade our lives.
In economics, the big challenge is to figure out how all the little pieces of the economy fit together to produce a result. It seems, at least at times, an impossible goal, because the interactions are so complex. One can make similar observations about many areas of science. Much scientific work has been focused on trying to understand the workings of small parts of complex systems (such as living organisms), in the hope that, once the pieces were understood, we could make the leap to a better understanding of the whole.
Now, after three centuries of profound discoveries, the real challenge is to master the process of reassembling the pieces, in ways that faithfully reflect the inevitable interactions among them. Bill Phillips, along with many other pioneers of the 1950s, took the first steps on this difficult road. By rendering the workings of a complex economic system visible in real time, he helped us embark on one of the most momentous scientific journeys humanity will ever take.
I really have to admire the ingenuity of Phillips and others that did this kind of work, even within the contraints of relatively primitive technology.
Random Walks 