nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2012‒03‒08
eight papers chosen by
Matthew Baker
City University of New York

  1. Desert and inequity aversion in teams By David, Gill; Rebecca, Stone
  2. From the lab to the field: envelopes, dictators and manners By Stoop, Jan
  3. Replicator Dynamics and Evolutionary Stable Strategies in Heterogeneous Games By Zuazo Garín, Peio; Rocha, André Barreira da Silva; Laruelle, Annick
  4. Culture and the Historical Process By Nathan Nunn
  5. Impulsive Consumption and Reflexive Thought: Nudging Ethical Consumer Behavior By Leonhard K. Lades
  6. Cognitive hierarchies in adaptive play By Khan Abhimanyu; Peeters Ronald
  7. Risk preferences over small stakes: Evidence from deductible choice By Janko Gorter; Paul Schilp
  8. Genes, Economics and Happiness By Nicholas A. Christakis; Jan-Emmanuel De Neve; James H. Fowler; Bruno S. Frey

  1. By: David, Gill; Rebecca, Stone
    Abstract: Teams are becoming increasingly important in work settings. We develop a framework to study the strategic implications of a meritocratic notion of desert under which team members care about receiving what they feel they deserve. Team members find it painful to receive less than their perceived entitlement, while receiving more may induce pleasure or pain depending on whether preferences exhibit desert elation or desert guilt. Our notion of desert generalizes distributional concern models to situations in which effort choices affect the distribution perceived to be fair; in particular, desert nests inequity aversion over money net of effort costs as a special case. When identical teammates share team output equally, desert guilt generates a continuum of symmetric equilibria. Equilibrium effort can lie above or below the level in the absence of desert, so desert guilt generates behavior consistent with both positive and negative reciprocity and may underpin social norms of cooperation.
    Keywords: Desert; Deservingness; Equity; Inequity aversion; Loss aversion; Reference-dependent preferences; Guilt; Reciprocity; Social norms; Team production
    JEL: D63 J33
    Date: 2012–02
  2. By: Stoop, Jan
    Abstract: Results are reported of the first natural field experiment on the dictator game, where subjects are unaware that they participate in an experiment. In contrast to predictions of the standard economic model, dictators show a large degree of pro-social behavior. This paper builds a bridge from the laboratory to the field to explore how predictive findings from the laboratory are for the field. External validity is remarkably high. In all experiments, subjects display an equally high amount of pro-social behavior, whether they are students or not, participate in a laboratory or not, or are aware that they participate in an experiment or not.
    Keywords: altruism; natural field experiment; external validity
    JEL: D63 D64 C70 C93 C91
    Date: 2012–03–02
  3. By: Zuazo Garín, Peio; Rocha, André Barreira da Silva; Laruelle, Annick
    Abstract: We generalise and extend the work of Iñarra and Laruelle (2011) by studying two person symmetric evolutionary games with two strategies, a heterogenous population with two possible types of individuals and incomplete information. Comparing such games with their classic homogeneous version vith complete information found in the literature, we show that for the class of anti-coordination games the only evolutionarily stable strategy vanishes. Instead, we find infinite neutrally stable strategies. We also model the evolutionary process using two different replicator dynamics setups, each with a different inheritance rule, and we show that both lead to the same results with respect to stability.
    Date: 2011–12
  4. By: Nathan Nunn
    Abstract: This article discusses the importance of accounting for cultural values and beliefs when studying the process of historical economic development. A notion of culture as heuristics or rules-of-thumb that aid in decision making is described. Because cultural traits evolve based upon relative fitness, historical shocks can have persistent impacts if they alter the costs and benefits of different traits. A number of empirical studies confirm that culture is an important mechanism that helps explain why historical shocks can have persistent impacts; these are reviewed here. As an example, I discuss the colonial origins hypothesis (Acemoglu, Johnson and Robinson, 2001), and show that our understanding of the transplantation of European legal and political institutions during the colonial period remains incomplete unless the values and beliefs brought by European settlers are taken into account. It is these cultural beliefs that formed the foundation of the initial institutions that in turn were key for long-term economic development.
    JEL: B52 N00
    Date: 2012–02
  5. By: Leonhard K. Lades
    Abstract: The paper deals with impulsive consumption and highlights the roles that cognitive and motivational aspects of reflexive thought (namely self-control and self-image motives, respectively) play in intertemporal decisions. While self-control inhibits individuals from consuming impulsively, self-image motives can induce impulsive consumption. Based on recent neuroscientific findings about 'wanting'–'liking' dissociations, the paper presents a potential motivational mechanism underlying such impulsive consumption decisions. Utilizing the knowledge of this mechanism and acknowledging both cognitive and motivational aspects of reflexive thought, the paper expands on three libertarian paternalistic means to foster an ethical way of impulsive consumption: strengthening willpower, reducing impulsive desires to consume, and guiding impulsive behavior in ethical directions by making salient certain self-images that favor ethical consumption.
    Keywords: Impulsive Consumption, 'Wanting' versus 'Liking', Ethical Consumption, Libertarian Paternalism subjective well-being, happiness, welfare economics, preference learning
    JEL: B B52 D03 D91 K2 Q3
    Date: 2012–03–01
  6. By: Khan Abhimanyu; Peeters Ronald (METEOR)
    Abstract: Inspired by the behavior in repeated guessing game experiments, we study adaptive play bypopulations containing individuals that reason with different levels of cognition. Individualsplay a higher order best response to samples from the empirical data on the history of play, wherethe order of best response is determined by their exogenously given level of cognition. As inYoung''s model of adaptive play, (unperturbed) play still converges to a minimal curb set. However,with the random perturbations of this (higher order) best response dynamic, the stochasticallystable states obtained may now be different, but in a deterministic manner. Perhapscounter-intuitively, higher cognition may actually be bad for both the individual with highercognition and his parent population.
    Keywords: microeconomics ;
    Date: 2012
  7. By: Janko Gorter; Paul Schilp
    Abstract: This paper provides new field evidence on risk preferences over small stakes. Using unique population and survey data on deductible choice in Dutch universal health insurance, we find that risk preferences are a dominant factor in decision aking. In fact, our results indicate that risk preferences are both statistically and quantitatively more significant in explaining deductible choice behavior than risk type. This finding contrasts with classical expected utility theory, as it implies risk neutrality over small stakes. More recently developed reference-dependent utility models, however, can rationalize risk aversion over small stakes, on account of loss aversion and narrow framing.
    Keywords: consumer preferences; insurance; deductible; decision making; loss aversion
    JEL: D12 D81 G22
    Date: 2012–02
  8. By: Nicholas A. Christakis; Jan-Emmanuel De Neve; James H. Fowler; Bruno S. Frey
    Abstract: A major finding from research into the sources of subjective well-being is that individuals exhibit a "baseline" level of happiness. We explore the influence of genetic variation by employing a twin design and genetic association study. We first show that about 33% of the variation in happiness is explained by genes. Next, using two independent data sources, we present evidence that individuals with a transcriptionally more efficient version of the serotonin transporter gene (SLC6A4) report significantly higher levels of life satisfaction. These results are the first to identify a specific gene that is associated with happiness and suggest that behavioral models benefit from integrating genetic variation.
    Keywords: wellbeing, socio-demographics, happiness, genetics, life satisfaction
    JEL: A12 D03 D87 Z00
    Date: 2012–02

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