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on Evolutionary Economics |
| By: | Birgitte Sloth (Department of Business and Economics, University of Southern Denmark); Hans Jørgen Whitta-Jacobsen (Department of Economics, University of Copenhagen) |
| Abstract: | We define an evolutionary process of “economic Darwinism” for playing-the-field, symmetric games. The process captures two forces. One is “economic selection”: if current behavior leads to payoff differences, behavior yielding lowest payoff has strictly positive probability of being replaced by an arbitrary behavior. The other is “mutation”: any behavior has at any point in time a strictly positive, very small probability of shifting to an arbitrary behavior. We show that behavior observed frequently is in accordance with “evolutionary equilibrium”, a static equilibrium concept suggested in the literature. Using this result, we demonstrate that generally under positive (negative) externalities, economic Darwinism implies even more under- (over-) activity than does Nash equilibrium. |
| Keywords: | evolutionary game theory; Darwinian evolution; economic selection; mutation; evolutionary equilibrium; stochastic stability |
| JEL: | C72 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuieci:2006-01&r=evo |
| By: | Lorenz Goette; David Huffman; Stephan Meier |
| Abstract: | Due to incomplete contracts, efficiency of an organization depends on willingness of individuals to take non-selfish actions, such as cooperating when there is no incentive to do so or punishing inefficient actions by others. Organizations also constitute a social boundary, or group. We investigate whether this social aspect of organizations has an important benefit— fostering unselfish cooperation and norm enforcement within the group—but also whether there is a dark side, in the form of hostility between groups. Our experiment provides the first evidence free from the confounding effect of self-selection into groups. Individuals are randomly assigned to different platoons during a four-week period of officer training in the Swiss Army. We conduct choice experiments—simultaneous prisoner’s dilemma games, with and without third-party punishment—in week three. Random assignment significantly increases willingness to cooperate with fellow platoon members. Assignment does not lead to hostility, in the sense of vindictive punishment of outsiders, but does affect norm enforcement, enhancing willingness to enforce a norm of cooperation towards fellow platoon members. This suggests that the social aspect of organizations motivates efficient behavior even when ordinary incentives fail and helps to explain practices designed to foster social ties or group identification within an organization. |
| Keywords: | Human behavior ; Interpersonal relations |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:06-7&r=evo |
| By: | Jurjen Kamphorst (Faculty of Law, Leiden University); Gerard van der Laan (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam) |
| Abstract: | We study how players in a local interaction hawk dove game will learn, if they can either imitate the most succesful player in the neighborhood or play a best reply versus the opponent's previous action. From simulations it appears that each learning strategy will be used, because each performs better when it is less popular. Despite that, clustering may occur if players choose their learning strategy on the basis of largely similar information. Finally, on average players will play Hawk with a probability larger than in the mixed Nash equilibrium of the stage game. |
| Keywords: | Learning; Local Interaction; Hawk-Dove game |
| JEL: | C73 |
| Date: | 2006–03–29 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20060034&r=evo |