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on Evolutionary Economics |
| By: | W. Ruprecht |
| Abstract: | A characteristic feature of economic development is the ever changing structure of consumption patterns. Reducing the explanation of this phenomenon to changing prices, finally caused by changes in the availability of goods (or characteristics), would neglect a major force driving this change, i.e. the variation of consumer wants and consumer knowledge. The present paper aims at sketching an evolutionary framework for the analysis of consumer behaviour that takes account of these features. For this purpose, Carl Menger's theory of goods is taken as a starting point. Whereas economists after the 'marginalistic revolution' were almost exclusively concerned with the determinants of exchange value and developing price theory, Menger puts as much emphasis on the user value as on the exchange value. Regarding the way of how user value changes a connection between Menger’s 19th century theory of goods and 20th century learning theories is established. The problem of how to get from individual learning processes to aggregate consumption patterns is approached by recollecting the genetic underpinnings of human learning and its contingency on certain physical and social conditions. Taking into account that these conditions are dynamic, the presented approach allows interpreting collective learning processes as historical events and makes them fruitful for the analysis of economic change. |
| Keywords: | Austrian economics, evolutionary economics, consumer theory, learning |
| JEL: | A12 B25 B52 B53 D11 D83 |
| Date: | 2005–10 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2005-11&r=evo |
| By: | Manfred Königstein (University of Erfurt and IZA Bonn); Marie-Claire Villeval (GATE (CNRS, University Lumière Lyon 2, Ecole Normale Supérieure LSH) and IZA Bonn) |
| Abstract: | The labor economics literature has shown that the "efficient bargaining" model, in which wage and employment are negotiated simultaneously, is less frequently used on unionized markets than the less efficient "right-to-manage" model, in which wage is determined via bargaining and employment determined subsequently and unilaterally by the firm. This paper reports an experiment in which the choice of the bargaining agenda is endogenous within a noncooperative game. We find that participants show a preference for decision authority and choose single-issue bargaining in most cases even though efficiency is lower than in multiissue bargaining. Furthermore, multi-issue bargaining induces unions to offer smaller payoff shares and leads to a higher conflict rate than in a single-issue bargaining. |
| Keywords: | bargaining agenda, efficient contracts, right-to-manage, decision authority, experiments |
| JEL: | C72 C78 C91 J51 J53 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1762&r=evo |
| By: | Luigi Mittone; Lucia Savadori |
| Abstract: | The bias generated by the subjective perception of scarcity on the consumer's choice is investigated using two separated experiments. The first experiment is aimed to define the prevailing preferences towards a set of commodities, the second experiment checked the effects produced by the perception that a given good is "scarce". The results shown a preference reversal phenomenon when scarcity is introduced in the experimental design. The results are coherent with a previous experiment (Mittone, Savadori, Rumiati, 2005) based on a developmental explanation of the basic scarcity bias and carried on a sample of children as participants. |
| Keywords: | Scarcity, Decision-making, Economic behavior |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwpce:0505&r=evo |
| By: | George W. Evans; Seppo Honkapohja; Noah Williams |
| Abstract: | We study the properties of generalized stochastic gradient (GSG) learning in forward-looking models. We examine how the conditions for stability of standard stochastic gradient (SG) learning both differ from and are related to E-stability, which governs stability under least squares learning. SG algorithms are sensitive to units of measurement and we show that there is a transformation of variables for which E-stability governs SG stability. GSG algorithms with constant gain have a deeper justification in terms of parameter drift, robustness and risk sensitivity. |
| JEL: | C62 C65 D83 E10 E17 |
| Date: | 2005–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberte:0317&r=evo |
| By: | Andrew J. Oswald (University of Warwick and IZA Bonn) |
| Abstract: | It is commonly claimed in the recent happiness literature in psychology and economics that we have proved diminishing marginal utility of income. This paper suggests that we have not. It draws a distinction between concavity of the utility function and concavity of the reporting function. |
| Keywords: | happiness, money, marginal utility, curvature, concave |
| JEL: | I3 D1 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1781&r=evo |