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on Evolutionary Economics |
| By: | Zarri, Luca (Associazione Italiana per la Cultura della Cooperazione e del Non Profit) |
| Abstract: | We set up an analytical framework focusing on the problem of interaction over time when economic agents are characterized by various types of distributional social preferences. We develop an evolutionary approach in which individual preferences are endogenous and account for the evolution of cooperation when all the players are initially entirely selfish. In particular, within motivationally heterogeneous agents embedded in a social network, we adopt a variant of the indirect evolutionary approach, where material payoffs play a critical role, and assume that a coevolutionary process occurs in which subjective preferences gradually evolve due to a key mechanism involving behavioral choices, relational intensity and degree of social openness. The simulations we carried out led to strongly consistent results with regard to the evolution of player types, the dynamics of material payoffs, the creation of significant interpersonal relationships among agents and the frequency of cooperation. In the long run, cooperation turns out to be the strategic choice that obtains the best performances, in terms of material payoffs, and "nice guys", far from finishing last, succeed in coming out ahead. |
| Keywords: | Behavioral Economics; Cooperation; Prisoner's Dilemma; Social Evolution; Heterogeneous Social Preferences; Indirect Evolutionary Approach |
| JEL: | B41 C73 D74 Z13 |
| Date: | 2008–06–24 |
| URL: | http://d.repec.org/n?u=RePEc:ris:aiccon:2008_051&r=evo |
| By: | Yannick Viossat (CEREMADE - CEntre de REcherches en MAthématiques de la DEcision - CNRS : UMR7534 - Université Paris Dauphine - Paris IX) |
| Abstract: | We show on a 4x4 example that many dynamics may eliminate all strategies used in correlated equilibria, and this for an open set of games. This holds for the best-response dynamics, the Brown-von Neumann-Nash dynamics and any monotonic or weakly sign-preserving dynamics satisfying some standard regularity conditions. For the replicator dynamics and the best-response dynamics, elimination of all strategies used in correlated equilibrium is shown to be robust to the addition of mixed strategies as new pure strategies. |
| Keywords: | Correlated equilibrium; Evolutionary dynamics; Elimination; As-if rationality |
| Date: | 2008–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-00360756_v1&r=evo |
| By: | Annamaria Nese; Patrizia Sbriglia |
| Abstract: | In this paper we explore the relationship between the individual’s preference for cooperation and the establishment of cooperative norms. Our aim is to provide an experimental test of the evolutionary hypothesis (see Carpenter, 2004, Fehr and Gachter 2002; Gintis 2000; Boyd, Bowles, Gintis and Richerson 2003; Bowles and Gintis 2004), according to which individuals are prepared to punish defectors in experimental social dilemma games because they want to enforce a social (“altruistic”) norm which may conduce to increasing their future payoffs, as in the case of sanctions against free riding behaviour. According to this line of research , the high levels of cooperation we observe in our societies can, therefore, be strictly related to the establishment of social norms which are able to enforce and maintain cooperation in the long run. We study the results of two experiments in which the individuals decided both whether to participate in a common project and the institutional rule according to which the profits of the project had to be shared among each of the participants in the group. They could choose between 1) a regime where gains were shared equally, regardless of individuals’ contributions and without sanctions and rewards (System A); 2) a regime where individuals were paid according to their marginal contribution, but the profits of the investments were lower than in the other contexts (System B); finally 3) a regime in which gains were shared equally (as in System A), but individuals were allowed to punish (and\or reward) free riding (cooperative) behaviours as in Sefton, Shupp and Walker (2007). Before the experiments took place, our subjects were required to fill a questionnaire composed of four sections, where their attitude to cooperate and their opinions on civic values and free riding behaviours were thoroughly explored. We then monitored the behaviour of potential free riders and cooperators in the game and their institutional choices. Our results partly contradict the evolutionary hypothesis in as much as System A and B received the largest shares of votes in almost all rounds and they were voted by free riders and cooperators alike. Thus, most individuals do not like sanctions (incentives) against defectors and free riders (cooperators), and their institutional preferences do not seem to be related to their willingness to cooperate. The inspection of individual data, however, reveals some interesting points. In fact, we can assert that System C was mostly chosen by cooperative individuals in response to observed free riding behaviour. Furthermore, when a cooperative individual chose C, she would tend to punish free riders and reward cooperators. Our conclusion is that, as far as the institutional choices are concerned, beside the profit motivations underlined in the evolutionary hypothesis, the ethical and cultural unobserved individual preferences play an important role. There is a number of individuals (limited in our experiments, ranging between 15 and 30 per cent of the entire population) who see cooperation as the “right” thing to do, and therefore are prepared to implement institutional rules that may favour this collective outcome. Most people in our experiments did not share these same values. |
| Keywords: | public good games, experiments, voting choices |
| JEL: | C90 C91 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:usi:labsit:025&r=evo |
| By: | Shchetinin, Oleg |
| Abstract: | I develop a model of contracting under reciprocal altruism accounting for some evidence which is paradoxical from the point of view of neoclassical models with selfish actors. My model predicts the crowding-out effect observed in the Trust Game with the possibility of a fine; for the Control Game the model predicts that an equilibrium can exhibit "no effect of control", "hidden cost of control", or "positive effect of control", depending on the characteristics of the actors, as observed in the lab. This suggests that reciprocal altruism modeling could be fruitful more generally in applications of contract theory. |
| Keywords: | Reciprocal Altruism; Extrinsic and intrinsic motivation; Behavioral Economics; Signaling; Contract Theory. |
| JEL: | M54 D82 C72 |
| Date: | 2009–02–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13457&r=evo |
| By: | Klaus Kultti (Department of Economics, University of Helsinki); Hannu Salonen (Department of Economics, University of Turku) |
| Abstract: | We study infinitely repeated Prisoners' Dilemma, where one of the players may be demented. If a player gets demented in period t after his choice of action, he is stuck to this choice for the rest of the game. So if his last choice was ``cooperate'' just before dementia struck him, then heÕs bound to cooperate always in the future. Even though a demented player cannot make choices any more he enjoys the same payoffs from strategy profiles as he did when healthy. A player may prove he is still healthy by showing a (costly) health certificate. This is possible only as long as the player really is healthy: a demented player cannot get a clean bill of health. We study an asymmetric information game where it is known that player 1 cannot get demented but player 2 may be either a ``healthy'' type who will never be demented or a ``dementible'' type who eventually will get demented. We study when cooperation can be maintained in a perfect Bayesian equilibrium with at most health check. |
| Keywords: | prisoners' dilemma, dementia, co-operation |
| JEL: | C72 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:tkk:dpaper:dp43&r=evo |
| By: | Jerry Busemeyer; Ariane Lambert-Mogiliansky |
| Abstract: | The Type Indeterminacy model is a theoretical framework that formalizes the constructive preference perspective suggested by Kahneman and Tversky. In this paper we explore an extention of the TI-model from simple to strategic decision-making. A 2X2 game is investigated. We first show that in a one-shot simultaneaous move setting the TI-model is equivalent to a standard incomplete information model. We then let the game be preceded by a cheap-talk promise exchange game. We show in an example that in the TI-model the promise stage can have impact on next following behavior when the standard classical model predicts no impact whatsoever. The TI approach differs from other behavioral approaches in identifying the source of the effect of cheap-talk promises in the intrinsic indeterminacy of the players' type. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pse:psecon:2009-07&r=evo |