nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2012‒03‒21
twelve papers chosen by
Matthew Baker
City University of New York

  1. Towards an understanding of the endogenous nature of group identification in games By Smith, John; Bezrukova, Katerina
  2. Cultural Diversity, Cooperation, and Antisocial Punishment By Marco Faillo; Daniela Grieco; Luca Zarri
  3. Status Quo Effects in Fairness Games: Reciprocal Responses to Acts of Commission vs. Acts of Omission By James C. Cox; Maroš Servátka; Radovan Vadovic
  4. Lyapunov stability in an evolutionary game theory model of the labor market By Araujo, Ricardo Azevedo; Moreira, Helmar Nunes
  5. Kantian Optimization, Social Ethos, and Pareto Efficiency By John E. Roemer
  6. An experiment investigating the spill-over effects of voicing outrage By Anastasios Koukoumelis; M. Vittoria Levati
  7. Do risk and time preferences have biological roots? By Drichoutis, Andreas; Nayga, Rodolfo
  8. Threshold public good games and impulse balance theory By Federica Alberti; Edward J. Cartwright; Anna Stepanova
  9. Experimental Evidence of Self-Image Concerns as Motivation for Giving By Tonin, Mirco; Vlassopoulos, Michael
  10. Like Father, Like Son: Inheriting and Bequeathing By Lars Kunze
  11. Hey Look at Me: The Effect of Giving Circles on Giving By Dean Karlan; Margaret A. McConnell
  12. Does fertility behavior spread among friends? By Nicoletta Balbo; Nicola Barban

  1. By: Smith, John; Bezrukova, Katerina
    Abstract: It is commonly assumed that identification with a social group is constant throughout the play of a one-shot game in the absence of feedback. We provide evidence which challenges this assumption. We direct subjects to play one of two versions of the prisoner's dilemma game. These versions are distinguished by the relative attractiveness of the uncooperative action. We refer to the version with a relatively attractive uncooperative action as the Easy Game and the other as the Difficult Game. We find that for the subjects who play the Difficult Game, their change in group identification is significantly related to their action selected. No such relationship exists within the Easy Game. Additionally, we find that the change primarily occurs after the action is selected rather than upon inspection of the game. We discuss the implications of our findings to settings both inside and outside of the laboratory.
    Keywords: Group Identification; Experimental Game Theory; Endogenous Preferences; Social Identity; Decision Difficulty
    JEL: Z10 C91 C72
    Date: 2012–03–14
  2. By: Marco Faillo (Department of Economics, University of Trento); Daniela Grieco (Department of Economics (University of Verona)); Luca Zarri (Department of Economics (University of Verona))
    Abstract: Is culture an important variable to explain whether groups can successfully provide public goods? A wealth of empirical evidence on both industrialized and developing countries shows that cooperation levels decrease in the presence of ethnic divisions. Although several laboratory works deal with cultural differences, so far most studies restrict their attention to cross-cultural comparisons among internally homogeneous societies. We depart from these contributions and conduct an intercultural public goods game with punishment experiment in Italy, a country where immigration is a quite recent, but politically hot phenomenon. We investigate the effects of introducing a varying number of foreign participants within a homogeneous pool of native subjects. Our results indicate that foreigners contribute significantly less than natives, natives react lowering their own contribution levels, and, consequently, the degree of cultural diversity negatively affects the overall level of cooperation. In terms of sanctioning, we observe no difference in the overall amount of assigned and received punishment points; however, behaving mostly as free-riders, foreigners are more likely to use anti-social punishment. In the absence of institutional restrictions ruling out anti-social punishment, this might amplify the documented detrimental effect on cooperation.
    Keywords: Experimental Economics; Public Good Games; Cooperation; Cultural Diversity; Anti-social Punishment.
    JEL: C72 C91 C92 D64 D71
    Date: 2012–03
  3. By: James C. Cox; Maroš Servátka; Radovan Vadovic
    Abstract: Both the law and culture make a central distinction between acts of commission that overturn the status quo and acts of omission that uphold it. In everyday life acts of commission often elicit stronger reciprocal responses than do acts of omission. In this paper we compare reciprocal responses to both types of acts and ask whether behavior of subjects in two experiments is consistent with existing theory. The design of the experiments focuses on the axioms of revealed altruism theory (Cox, Friedman, and Sadiraj, 2008) that make it observationally distinct from other theories, Axiom R (for reciprocity) and Axiom S (for status quo). We find support for this theory in both experiments.
    Date: 2012–02
  4. By: Araujo, Ricardo Azevedo; Moreira, Helmar Nunes
    Abstract: In this paper the existence and stability of equilibria in an evolutionary game theory model of the labor market is studied by using the Lyapunov method. The model display multiple equilibria and it is shown that the Nash Equilibria of the static game are evolutionary stable equilibria in the game theory evolutionary set up. In this vein a complete characterization of the dynamics of an evolutionary model of the labor market is provided.
    Keywords: Evolutionary game theory approach, labour market, informal economy, Lyapunov function
    JEL: C73 J23
    Date: 2011–03
  5. By: John E. Roemer (Dept. of Political Science, Yale University)
    Abstract: Although evidence accrues in biology, anthropology and experimental economics that homo sapiens is a cooperative species, the reigning assumption in economic theory is that individuals optimize in an autarkic manner (as in Nash and Walrasian equilibrium). I here postulate an interdependent kind of optimizing behavior, called Kantian. It is shown that in simple economic models, when there are negative externalities (such as congestion effects from use of a commonly owned resource) or positive externalities (such as a social ethos reflected in individuals’ preferences), Kantian equilibria dominate Nash-Walras equilibria in terms of efficiency. While economists schooled in Nash equilibrium may view the Kantian behavior as utopian, there is some -- perhaps much -- evidence that it exists. If cultures evolve through group selection, the hypothesis that Kantian behavior is more prevalent than we may think is supported by the efficiency results here demonstrated.
    Keywords: Kantian equilibrium, Social ethos, Implementation
    JEL: D60 D62 D64 C70 H30
    Date: 2012–03
  6. By: Anastasios Koukoumelis (Max Planck Institute of Economics, Jena); M. Vittoria Levati (Max Planck Institute of Economics, Jena, and Department of Economics, University of Verona)
    Abstract: We report on an experiment designed to explore whether and how anger affects future levels of cooperation. Participants play three consecutive one-shot games. In between two identical two-person public goods games there is a mini dictator game that, depending on the treatment, either gives or does not give the recipient the opportunity to scold the dictator via a text message. We find that the recipients that receive an unfair offer contribute significantly less in the second public goods game. Yet, such contribution cuts are less frequent and notably smaller when messaging is allowed for. We conclude that although anger has a lasting negative effect on cooperation, giving voice to it helps to curtail selfishness.
    Keywords: Dictator minigame, Public goods game, Emotions, Cooperation
    JEL: C72 C91 C92 D63
    Date: 2012–03–07
  7. By: Drichoutis, Andreas; Nayga, Rodolfo
    Abstract: We revisit the claims about the biological underpinnings of economic behavior by specifically exploring if observed gender differences in risk/time preferences can be explained by natural fluctuations in progesterone/estradiol levels during the menstrual cycle and by prenatal exposure to testosterone levels. Results suggest that natural fluctuations in progesterone levels have a direct effect on discount rates and that estradiol/progesterone levels can indirectly affect time preferences by changing the curvature of the utility function. Using measured D2:D4 digit ratio, results imply that subjects with low digit ratio exhibit higher discount rates and risk loving preferences.
    Keywords: discount rates; risk aversion; lab experiment; menstrual cycle; D2:D4 ratio; hormones; estradiol; progesterone; testosterone
    JEL: D81 C91
    Date: 2012–03–12
  8. By: Federica Alberti (Max Planck Institute of Economics, Strategic Interaction Group, Jena); Edward J. Cartwright (School of Economics, University of Kent, Canterbury); Anna Stepanova (School of Economics, University of Kent, Canterbury)
    Abstract: We propose and develop a model of behavior in threshold public good games. The model draws on learning direction theory and impulse balance theory. We find good support for the model and demonstrate that it can explain the success rates observed in threshold public good experiments. The model is applied in a variety of dierent settings : we compare games with a full refund to those with no refund, consider changes in relative endowment, and consider changes in the step return and net reward.
    Keywords: Public good, threshold, learning direction theory, impulse balance theory, counterfactual thinking
    JEL: C72 H41 C92
    Date: 2012–01–06
  9. By: Tonin, Mirco (University of Southampton); Vlassopoulos, Michael (University of Southampton)
    Abstract: We conduct an experiment in which subjects make a series of decisions of allocating an endowment of £10 between themselves and a passive recipient that is either a charity or the experimenter. When making these decisions subjects are informed that one of them will be chosen randomly at the end to determine payoffs. After all decisions have been made and it has been revealed which decision will determine payoffs we offer subjects an opportunity to opt out from their initial decision and receive £10 instead. We find that around one third of subjects choose to opt out. The fact that a subject decides to revise a decision to give and chooses instead to exit and keep the whole amount – an option that was available when she made the first decision and was not exercised – indicates that giving in the first instance was not motivated solely by altruism toward the recipient. We argue that opting out indicates that giving is also motivated by self-image concerns.
    Keywords: dictator game, charitable giving, opting-out, self-image
    JEL: C91 D03 D64
    Date: 2012–02
  10. By: Lars Kunze
    Abstract: Empirical evidence suggests that parents who have themselves inherited from their own parents are more likely to leave an estate to their children even after controlling for income, wealth and education. This implies an indirect reciprocal behavior between three generations by transmitting the attitude towards bequeathing from one generation to the next. We incorporate such an intergenerational chain into an overlapping generations model and show that the economy might be characterized by multiple steady states involving poverty traps. Individuals will not leave bequests unless per capita income levels exceed a threshold level. In such a situation, an unfunded social security security programme may help to overcome poverty by providing additional old age income out of which to bequeath.
    Keywords: Capital accumulation; indirect reciprocity; overlapping generations; unfunded social security
    JEL: D64 D91 H55
    Date: 2012–02
  11. By: Dean Karlan (Economic Growth Center, Yale University); Margaret A. McConnell (Harvard School of Public Health)
    Abstract: Theories abound for why individuals give to charity. We conduct a field experiment with donors to a Yale University service club to test the impact of a promise of public recognition on giving. Some may claim that they respond to an offer of public recognition not to improve their social standing, but rather to motivate others to give. To tease apart these two theories,we conduct a laboratory experiment with undergraduates, and found no evidence to support the alternative, altruistic motivation. We conclude that charitable gifts increase in response to the promise of public recognition primarily because of individuals' desire to improve their social image.
    Keywords: endowments, prosocial behavior, experiments, voluntary contributions, social image
    JEL: D64 C90 L30
    Date: 2012–01
  12. By: Nicoletta Balbo; Nicola Barban
    Abstract: This paper investigates how social interactions among friends shape fertility. We specifically examine whether and how friends’ fertility behaviour affects an individual’s transition to parenthood. By integrating insights from economic and sociological theories, we elaborate on the mechanisms via which interactions among friends might affect an individual’s risk of becoming a parent. By exploiting the survey design of the Add Health data, we follow a strategy that allows us to properly identify interaction effects and distinguish them from selection and contextual effects. We engage in a series of discrete time event history models with random effect at the dyadic level. Results show that, net of confounding effects, a friend’s childbearing increases an individual’s risk of becoming a parent. We find a short-term, curvilinear effect: an individual’s risk of childbearing starts increasing after a friend’s childbearing, it reaches its peak around two years later, and then decreases.
    Keywords: transition to parenthood; add-health; social interaction; peer effect
    Date: 2012–02

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