nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2006‒04‒22
eight papers chosen by
Matthew Baker
US Naval Academy, USA

  1. The Importance of Emotions for the Effectiveness of Social Punishment By Astrid Hopfensitz; Ernesto Reuben
  2. Active Decisions and Pro-social Behavior: A Field Experiment on Blood Donation By Alois Stutzer; Lorenz Goette; Michael Zehnder
  3. Social Ties and Coordination on Negative Reciprocity: The Role of Affect By Ernesto Reuben; Frans van Winden
  4. A Theory of Procedurally Rational Choice: Optimization without Evaluation By Stefano Ficco; Vladimir Karamychev; Peran van Reeven
  5. Learning Under Ambiguity By Larry Epstein; Martin Schneider
  6. Experimental Strategy for Investigating the Neural Basis of Framing Effects By Sacha Bourgeois-Gironde; Elise Payzan
  7. Aspiration Traps By Aviad Heifetz; Enrico Minelli
  8. Metamimetic Games : Modeling Metadynamics in Social Cognition By David Chavalarias

  1. By: Astrid Hopfensitz (University of Geneva); Ernesto Reuben (Department of Economics, University of Copenhagen)
    Abstract: This paper experimentally explores how the enforcement of cooperative behavior in a social dilemma is facilitated through institutional as well as emotional mechanisms. Recent studies emphasize the importance of anger and its role in motivating individuals to punish free riders. However, we find that anger also triggers retaliatory behavior by the punished individuals. This makes the enforcement of a cooperative norm more costly. We show that in addition to anger, ‘social’ emotions like guilt need to be present for punishment to be an effective deterrent of uncooperative actions. They play a key role by subduing the desire of punished individuals to retaliate and by motivating them to behave more cooperatively in the future.
    JEL: Z13 C92 D74 H41
    Date: 2005–07
  2. By: Alois Stutzer (University of Zurich and IZA Bonn); Lorenz Goette (University of Zurich, CEPR and IZA Bonn); Michael Zehnder (University of Zurich)
    Abstract: In this paper, we propose a decision framework where people are individually asked to either actively consent or dissent to some pro-social behavior. We hypothesize that confronting individuals with the choice of engaging in a specific pro-social behavior contributes to the formation of issue-specific altruistic preferences while simultaneously involving a commitment. The hypothesis is tested in a large-scale field experiment on blood donation. We find that this "active-decision" intervention substantially increases the stated willingness to donate blood, as well as the actual donation behavior of people who have not fully formed preferences beforehand.
    Keywords: active decision, pro-social behavior, field experiment, blood donation
    JEL: C93 D64 I18
    Date: 2006–04
  3. By: Ernesto Reuben (Department of Economics, University of Copenhagen); Frans van Winden (University of Amsterdam)
    Abstract: This is an experimental study of a three-player power-to-take game where a proposer is matched with two responders. We compare a treatment in which subjects are anonymous to each other (strangers) with one in which responders know each other from outside the lab (friends). We focus on the responders’ decisions, beliefs, and emotions. We find that friends punish the proposer more than strangers, and that they are more likely to coordinate their punishment (without communication). Both punishment and coordination are explained by the responders’ emotional reactions. Furthermore, the responders’ expectations are better predictors of emotions and destruction than their fairness perceptions.
    JEL: Z13 D74 C92 D63
  4. By: Stefano Ficco (Erasmus Universiteit Rotterdam); Vladimir Karamychev (Erasmus Universiteit Rotterdam); Peran van Reeven (Erasmus Universiteit Rotterdam)
    Abstract: This paper analyses the behavior of an individual who wants to maximize his utility function, but he is not able to evaluate it. There are many ways to choose a single alternative from a given set. We show that a unique utility maximizing procedure exists. Choices induced by this optimal procedure are always transitive but generally violate the Weak Axiom. In other words, utility maximizing individuals who are unable to evaluate their objective functions fail to exhibit rational revealed preferences.
    Keywords: Bounded rationality; optimal selection procedure; procedural rationality
    JEL: D81
    Date: 2006–01–06
  5. By: Larry Epstein (University of Rochester); Martin Schneider (New York University)
    Abstract: This paper considers learning when the distinction between risk and ambiguity matters. It first describes thought experiments, dynamic variants of those provided by Ellsberg, that highlight a sense in which the Bayesian learning model is extreme - it models agents who are implausibly ambitious about what they can learn in complicated environments. The paper then provides a generalization of the Bayesian model that accommodates the intuitive choices in the thought experiments. In particular, the model allows decision-makers’ confidence about the environment to change — along with beliefs — as they learn. A calibrated portfolio choice application shows how this property induces a trend towards more stock market participation and investment.
    Keywords: ambiguity, learning, noisy signals, ambiguous signals, quality information, portfolio choice, portfolio diversification, Ellsberg Paradox
    JEL: D81 D83 D9 G11 G12
    Date: 2006–04
  6. By: Sacha Bourgeois-Gironde (IJN - Institut Jean-Nicod - - CNRS : UMR8129 - Ecole des Hautes Etudes en Sciences Sociales;Ecole Normale Supérieure de Paris); Elise Payzan (LSE - London School of Economics - - London School of Economics)
    Abstract: We investigate subjective reactions when subjects realize they have been victims of framing-effects in situations of risky choices - that is, when they violated the invariance principle in decision-theory. We try to assess various explanations of this violation in terms of bounded rationality and cognitive biases. One criterion we use in our assessment is a feeling of cognitive discomfort subjects may have after norm infringement. In ourexperimental study of framing effects, it is crucial to confront these "feelings of irrationality" and contextual reasons (moral and/or emotional) subjects may give to justify their violation of the invariance principle.
    Keywords: framing effects, cognitive biases, bounded rationality, debriefings.
    Date: 2006–01–11
  7. By: Aviad Heifetz; Enrico Minelli
    Abstract: Fundamental choices, like location or education, affect the attitudes and beliefs with which the individual will analyze future day to day decision problems. These effects cannot be assumed to be transparent to the individual. To restore methodological discipline in the analysis of such choices, we propose a solution concept based on an idea of consistency: the individual should not regret her fundamental choices after her preferences and beliefs have adjusted thereof. We show that even single person decision problems admit multiple, Pareto-ranked solutions: the individual might be stuck in an aspiration trap.
  8. By: David Chavalarias (CREA - Centre de recherche en épistémologie appliquée - [CNRS : UMR7656] - [] - [Polytechnique - X])
    Abstract: Imitation is fundamental in the understanding of social system dynamics. But the diversity of imitation rules employed by modelers proves that the modeling of mimetic processes cannot avoid the traditional problem of endogenization of all the choices, including the one of the mimetic rules. Starting from the remark that human reflexive capacities are the ground for a new class of mimetic rules, I propose a formal framework, metamimetic games, that enable to endogenize the distribution of imitation rules while being human specific. The corresponding concepts of equilibrium - counterfactually stable state - and attractor are introduced. Finally, I give an interpretation of social differentiation in terms of cultural co-evolution among a set of possible motivations, which departs from the traditional view of optimization indexed to criteria that exist prior to the activity of agents.
    Keywords: Social cognition, imitation, cultural co-evolution, differentiation, reflexivity, metacognition, stochastic game theory, endogenous distributions, metamimetic games, counterfactual equilibrium.
    Date: 2006–04–05

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