nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2008‒04‒15
seven papers chosen by
Matthew Baker
City University of New York

  1. The Evolution of Social Norms and Individual Preferences By Rodrigo Harrison; Mauricio Villena
  2. Adversarial scheduling analysis of Game-Theoretic Models of Norm Diffusion. By Istrate, Gabriel; Marathe, Madhav V.; Ravi, S.S.
  3. Framing and Free Riding: Emotional Responses and Punishment in Social Dilemma Games By Robin P. Cubitt; Michalis Drouvelis; Simon Gächter
  4. Network Structure in a Link-formation Game: An Experimental Study By Alexander Elbittar; Rodrigo Harrison; Roberto Muñoz
  5. Neuroeconomics: A Critique of 'Neuroeconomics: A Critical Reconsideration' By Stanton, Angela A.
  6. Belief Formation: An Experiment With Outside Observers By Kyle Hyndman; Wolf Ehrblatt; Erkut Ozbay; Andrew Schotter
  7. The Descriptive and Predictive Adequacy of Theories of Decision Making Under Uncertainty/Ambiguity By John D Hey; Gianna Lotito; Anna Maffioletti

  1. By: Rodrigo Harrison (Instituto de Economía. Pontificia Universidad Católica de Chile.); Mauricio Villena
    Abstract: Why does an altruistically inclined player behave altruistically in some contexts and egoistically or spitefully in others? This article provides an economic explanation to this question. The basic argument is centered on the idea that social norms shape our preferences through a process of cultural learning. In particular, we claim that, in contexts with a stable norm of reciprocity, an altruistic player can respond in kind to egoistic or spiteful players by behaving either egoistically or spitefully when confronting them and yet continue to be an altruistic player. This is why, instead of studying the evolution of preferences as such, in this work we analyze the evolution of social norms that indirectly determine individual preferences and behavior. Such a study requires that we distinguish between players' behavioral preferences, or those individuals show with their behavior, and players' intrinsic preferences, or those they inherently support or favor. We argue that, whereas the former can change through the evolution of social norms, in this case a reciprocity norm, the latter are not subject to evolutionary pressures and, therefore, we assume them to be given.
    Keywords: Social Norms, Reciprocity, Endogenous
    JEL: C72 A13
    Date: 2008
  2. By: Istrate, Gabriel; Marathe, Madhav V.; Ravi, S.S.
    Abstract: In (Istrate et al. SODA 2001) we advocated the investigation of robustness of results in the theory of learning in games under adversarial scheduling models. We provide evidence that such an analysis is feasible and can lead to nontrivial results by investigating, in an adversarial scheduling setting, Peyton Young's model of diffusion of norms . In particular, our main result incorporates contagion into Peyton Young's model.
    Keywords: evolutionary games; stochastic stability; adversarial scheduling.
    JEL: Z13 C73
    Date: 2008–04–09
  3. By: Robin P. Cubitt (University of Nottingham); Michalis Drouvelis (University of Nottingham); Simon Gächter (University of Nottingham)
    Abstract: In this paper, we report an experimental investigation of the effect of framing on social preferences, as revealed in a one-shot linear public goods game. We use two indicators to measure social preferences: self-reported emotional responses; and, as a behavioural indicator of disapproval, punishment. Our findings are that, for a given pattern of contributions, neither punishment nor emotion depends on the Give versus Take framing that we manipulate. To this extent, they suggest that the social preferences we observe are robust to framing effects.
    Keywords: framing effects, punishment, emotions, public goods experiments
    JEL: C92 D01 H41
    Date: 2008–03
  4. By: Alexander Elbittar; Rodrigo Harrison (Instituto de Economía. Pontificia Universidad Católica de Chile.); Roberto Muñoz
    Abstract: Network formation is frequently modeled using link-formation games and typically present a multiplicity of Nash equilibria. Cooperative refinements - such as strong or coalitional proof Nash equilibria - have been the standard tool used for equilibrium selection in these games. Non-cooperative refinements derived from the theory of global games have shown also that, for a class of payo¤ functions, multiplicity of equilibria disappears when the game is perturbed by introducing small amounts of incomplete information. We conducted a laboratory study evaluating the predictive power of each of these refinements in an illustrative link-formation game. Compared with cooperative game solutions, the global game approach did significantly better at predicting the strategies played by individuals in the experiment.
    Keywords: Networks, Global Games, Cooperative Games, Equilibrium Selection, Experimental economics.
    JEL: C70 C92 D20 D44 D82
    Date: 2008
  5. By: Stanton, Angela A.
    Abstract: Some economists believe that the work of neuroeconomists threatens the theory of economics. Glenn Harrison’s paper “Neuroeconomics: A Critical Reconsideration” attempts to set the score, though the points he makes are hidden behind the fumes of his anger (Glenn W. Harrison 2008). The field of neuroeconomics is barely into its teenage years; and it is trying to do what? Redesign the field of economics developed over a hundred years? No, that is not what neuroeconomics is trying to do, in spite of all the efforts of some economists trying to place it into that shoebox. Neuroeconomics is a Mendelian-Economics of sort; it is a science that is able to generate data by fixing the environment to some degree and looking to see each individual’s choices from the initiation of the decision-making process to its outcome. Standard economics (SE), on the other hand, looks at the average of the outputs of many individuals and proposes how the human chose those outcomes. The two fields, neuroeconomics and SE, are evaluating two sides of the same coin; one with and the other without ceteris paribus; they are not necessarily in conflict with one another.
    Keywords: A debate over the field of Neuroeconomics
    JEL: C90 D01 B41
    Date: 2008–03–25
  6. By: Kyle Hyndman (SMU); Wolf Ehrblatt (NYU); Erkut Ozbay (Maryland); Andrew Schotter (NYU)
    Abstract: In this paper we investigate the necessary ingredients for an accurate model of belief formation. Using experimental data from a previous experiment, we bring in a new group of subjects whose job it is to predict the action choices of the subjects from the previous experiment. While the rules we consider are all, strictly speaking, adaptive (being based on past observables), some of the variables we uncover represent fairly sophisticated behaviour. Going from less to more sophisticated, we find that the following are important components of the belief formation process: the history of play, payoffs (whether real or ``imagined" in the sense of \citet{CH99}) of the player whose actions our subjects are predicting and the payoffs of the other player. The paper also documents the presence of subject-specific heterogeneity in both initial beliefs and, to varying degrees, almost all of the variables found to influence beliefs.
    Keywords: Game Theory, Belief Formation, Learning.
    JEL: C70 C91 D83 D84
    Date: 2008–04
  7. By: John D Hey; Gianna Lotito; Anna Maffioletti
    Abstract: In this paper we examine the performance of theories of decision making under uncertainty/ambiguity from the perspective of their descriptive and predictive power, taking into account the relative parsimony of the various theories. To this end, we employ an innovative experimental design which enables us to reproduce ambiguity in the laboratory in a transparent and non-probabilistic way. We find that judging theories on the basis of their theoretical appeal, or on their ability to do well in testing contexts, is not the same as judging them on the basis of their explanatory and predictive power. We also find that the more elegant theoretical models do not perform as well as simple rules of thumb.
    Keywords: Ambiguity, Bingo Blower, Choquet Expected Utility, Decision Field Theory, Decision Making, Expected Utility, Hurwicz Criterion, (Gilboa and Schmeidler) MaxMin EU, (Gilboa and Schmeidler) MaxMax EU, (Ghirardato) Alpha-Model, MaxMin, MaxMax, Minimum Regret, Prospect Theory, Uncertainty.
    JEL: D81 C91
    Date: 2008–04

This nep-evo issue is ©2008 by Matthew Baker. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.