The Free-Market Algorithm: Self-Organizing Optimization for Open-Ended Complex Systems

Authors: Martin Jaraiz Date: 2026-03-25 Paper ID: openalex:2603.24559

Summary

The paper introduces the Free-Market Algorithm (FMA), a novel metaheuristic optimization method inspired by free-market economics that eschews fixed fitness functions for emergent fitness derived from distributed supply-and-demand dynamics among autonomous agents. Solutions are represented as hierarchical pathway networks, allowing for open-ended search space exploration. FMA successfully applied this mechanism to complex problems, discovering key prebiotic molecules in chemistry and achieving low-error macroeconomic GDP forecasts across multiple nations using only input-output data. The dynamics align with Assembly Theory, suggesting the algorithm may reflect a fundamental organizational principle in nature.

Key Contributions

• Introduction of the Free-Market Algorithm (FMA), a metaheuristic using distributed supply-and-demand dynamics where fitness emerges rather than being explicitly prescribed.
• Demonstration of FMA’s capability to discover fundamental prebiotic chemistry structures (amino acids, nucleobases, sugars) from atomic primitives within minutes.
• Achieving professional-level macroeconomic GDP forecasting accuracy (MAE of 0.42 pp) across 33 countries using only a single input-output table with zero parameter estimation.
• Providing the first explicit, tunable mechanism for generating the selection signatures described by Assembly Theory.

Limitations

The paper focuses heavily on demonstrating feasibility in two domains and does not detail scalability analysis or convergence guarantees for general complex systems beyond the demonstrated cases.

Key Concepts

• free-market-algorithm: A metaheuristic optimization algorithm inspired by free-market economics that uses distributed supply-and-demand dynamics to evolve solutions as hierarchical pathway networks without a prescribed fitness function.
• hierarchical-pathway-networks-solutions: Solutions in the Free-Market Algorithm are represented as evolving, hierarchical pathway networks discovered through agent interactions.

Archivist Review

The primary contribution, the Free-Market Algorithm (FMA), is approved as it introduces a fundamentally novel metaheuristic framework based on emergent fitness via market dynamics, making it highly reusable. The structural representation of solutions as Hierarchical Pathway Networks is also approved as a novel output concept distinct from the optimization process itself. Other potential concepts were rejected as they were either subcomponents of the core algorithm or applications to existing theories. No explicit, reusable open questions were identified in the provided analysis.

Approved Concepts

• Free-Market Algorithm: FMA is the core novel optimization metaheuristic proposed, distinguished by using emergent fitness via supply-and-demand dynamics over an open-ended search space.
• Hierarchical Pathway Networks as Solutions: This defines the structural output of the FMA, moving beyond simple scalar or vector solutions to complex structured pathways, critical for its application in chemistry and economics.

Rejected Candidates

• [concept] Supply-and-Demand Dynamics Optimization (supply-demand-dynamics-optimization) - subcomponent_of_broader_mechanism: This mechanism is too generic and is captured better by the core concept ‘Free-Market Algorithm’.
• [concept] Assembly Theory Alignment (assembly-theory-alignment) - not_novel: This is an application of the FMA to existing theory (Assembly Theory) rather than a distinct, novel mechanism introduced by the paper itself.

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