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on Evolutionary Economics |
| By: | Joachim Weimann (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Jeannette Brosig-Koch; Heike Hennig-Schmidt; Claudia Keser; Christian Stahr (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | Many of real-world public-goods are characterized by a marginal per capita return (MPCR) close to zero and have to be provided by large groups. Up until now, there is almost no evidence on how large groups facing a low MPCR behave in controlled public-good laboratory experiments involving financial incentives. Connecting four experimental laboratories located in four di¤erent German universities via Internet, we are able to run such experiments. In ad-dition to the group size (60 and 100 subjects), we vary the MPCR which is as small as 0:02 or 0:04. Our data reveal a strong MPCR effect, but almost no group-size e¤ect. Our data demonstrates that, even in large groups and for low MPCRs, considerable contributions to public goods can be expected. Interestingly, the contribution patterns observed in large and very small groups are very similar. To the best of our knowledge, this study is the first one that includes large-group laboratory experiments with a small MPCR under conditions comparable to previous small-group standard public-good experiments. |
| JEL: | C91 C72 H42 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:120009&r=evo |
| By: | Claude Ménard (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne); Shirley Mary M. (RCI - Ronald Coase Institute - Ronald Coase Institute) |
| Abstract: | Douglass North, along with Ronald Coase and Oliver Williamson, transformed the early intuitions of new institutional economics into powerful conceptual and analytical tools that spawned a robust base of empirical research. NIE arose in response to questions not well explained by standard neoclassical models, such as make or buy and why rich or poor? Today NIE is a success story by many measures: four Nobel laureates in under 20 years, increasing penetration of mainstream journals, and significant impact on major policy debates from anti-trust law to development aid. This paper provides a succinct overview of North's evolving ideas about institutions and explains how North's work shaped the emerging field of new institutional economics and had a potent impact on economics and the social sciences more broadly. North provides a powerful example of how persistent and well placed confidence and hard work can productively transform the status quo. North's influence continues strong and his enthusiasm for exploring new frontiers and cooperating across artificial academic boundaries has never waned. |
| Keywords: | New Institutional Economics, institutions, transaction costs, development and growth |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00624297&r=evo |
| By: | Nicolas Jacquemet (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Stephane Luchini (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - CNRS : UMR6579); Jason Shogren (Departement of Economics and Finance, University of Wyoming - University of Wyoming); Adam Zylbersztejn (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne) |
| Abstract: | Herein we explore whether the social psychology theory of commitment via a truth-telling oath can reduce coordination failure. Using a classic sequential coordination game, we ask all players to sign voluntarily a truth-telling oath before playing the game with cheap-talk communication. Three results emerge with commitment-via-the-oath: (1) coordination increased by nearly 50 percent; (2) senders' messages were significantly more truthful and actions more efficient, and (3) receivers' trust of messages increased. |
| Keywords: | Coordination game; Cheap talk communication; Oath |
| Date: | 2011–10–26 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00635801&r=evo |
| By: | Ozlem Ozdemir (Middle East Technical University, Department of Business Administration, Ankara, Turkey); Andrea Morone (Università degli Studi di Bari, Aldo Moro Dipartimento di Studi Aziendali e Giusprivatistici, Bari, Italy And Universitat Jaune I Departament d'Economia, Castellon, SpainAuthor-Name: David Skuse) |
| Abstract: | This experimental study investigates insurance decisions in low-probability, high-loss risk situations. Results indicate that subjects consider the probability of loss (loss size) when they make buying decisions (paying decisions). Most individuals are risk averse with no specific threshold probability. |
| Keywords: | Black swan, Risk, Insurance, Low probability, High loss, Experiment |
| JEL: | C91 D81 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:jau:wpaper:2012/12&r=evo |
| By: | Pierre Pestieau (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, CREPP - Center of Research in Public Economics and Population Economics - Université de Liège, CORE - Center of Operation Research and Econometrics [Louvain] - Université Catholique de Louvain, CEPR - Center for Economic Policy Research - CEPR); Grégory Ponthière (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, ENS - Ecole Normale Supérieure de Paris - Ecole Normale Supérieure de Paris - ENS Paris) |
| Abstract: | We explore the optimal fertility age-pattern in a four-period OLG economy with physical capital accumulation. For that purpose, we .rstly compare the dynamics of two closed economies, Early and Late Islands, which di¤er only in the timing of births. On Early Island, children are born from parents in young adulthood, whereas, on Late Island, children are born from parents in older adulthood. We show that, unlike on Early Island, there exists no stable stationary equilibrium on Late Island, which exhibits cyclical dynamics. We also characterize the social optimum in each economy, and show that Samuelson.s Serendipity Theorem still holds. Finally, we study the dynamics and social optimum of an economy with interior fertility rates during the reproduction period. It is shown that various fertility age-patterns are compatible with the social optimum, as long as these yield the optimal cohort growth rate. The Serendipity Theorem remains valid in that broader demographic environment. |
| Keywords: | childbearing ages ; early and late motherhoods ; fertility ; overlapping generations ; social optimum |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-00612609&r=evo |
| By: | Ömer Özak (Southern Methodist University) |
| Abstract: | I study how boundedly rational agents can learn the solution to an infinite horizon optimal consumption problem under uncertainty and liquidity constraints. I present conditions for the existence of an optimal linear consumption rule and characterize it. Additionally, I use an empirically plausible theory of learning to generate a class of adaptive learning algorithms that converges to the optimal rule. This provides an adaptive and boundedly rational foundation to neoclassical consumption theory. |
| Keywords: | Adaptive learning models, bounded rationality, dynamic programming, consumption function, behavioral economics, liquidity constraint, Markov process |
| JEL: | C6 D8 D9 E21 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:smu:ecowpa:1204&r=evo |
| By: | McKee, Michael; Siladke, Caleb; Vossler, Christian A. |
| Abstract: | Tax authorities utilize the audit process, imposing penalties on tax evaders, as their primary means of enforcement. In recent years, a “service” paradigm, whereby tax authorities provide information about correct tax reporting to taxpayers, has shown the potential to further “encourage” correct tax reporting. This research utilizes laboratory experiments to investigate the behavioral dynamics pertaining to information acquisition and tax evasion. The results show that the overall effect of a helpful information service is to decrease tax evasion. Further, an audit has the behavioral effect of lowering information acquisition rates and increasing evasion immediately after experiencing a penalty. This effect persists (although diminishes) in subsequent tax reporting decisions. |
| Keywords: | Tax evasion; Tax compliance; Behavioral Dynamics; Behavioral economics; Experimental economics |
| JEL: | C91 H26 |
| Date: | 2011–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:38865&r=evo |
| By: | Laibson, David I.; Madrian, Brigitte; Beshears, John; Choi, James J. |
| Abstract: | We describe the pension plan features of the states and the largest cities and counties in the U.S. Unlike in the private sector, defined benefit (DB) pensions are still the norm in the public sector. However, a few jurisdictions have shifted towards defined contribution (DC) plans as their primary savings plan, and fiscal pressures are likely to generate more movement in this direction. Holding fixed a public employee‘s work and salary history, we show that DB retirement income replacement ratios vary greatly across jurisdictions. This creates large variation in workers‘ need to save for retirement in other accounts. There is also substantial heterogeneity across jurisdictions in the savings generated in primary DC plans because of differences in the level of mandatory employer and employee contributions. One notable difference between public and private sector DC plans is that public sector primary DC plans are characterized by required employee or employer contributions (or both), whereas private sector plans largely feature voluntary employee contributions that are supplemented by an employer match. We conclude by applying lessons from savings behavior in private sector savings plans to the design of public sector plans. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:hrv:hksfac:4723207&r=evo |
| By: | Beja Jr., Edsel L. |
| Abstract: | How SWB affects individual states, outcomes, or decisions is well established in the literature, but how it affects macroeconomic states, outcomes, or decisions remains an open empirical question. This paper focuses on the public policy issue of economic progress defined as either rapid economic growth or stable economy. Results indicate a negative relationship between high SWB and choice for rapid economic growth or stable economy. This conclusion holds for people in the upper-income and middle-income countries, but not so for people in the low-income countries. In fact, results suggest that people in the low-income countries attend less to either rapid economic growth or stable economy regardless of their SWB. |
| Keywords: | Happiness; subjective well-being; economic policy |
| JEL: | D70 I31 B50 D00 E60 |
| Date: | 2012–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:38851&r=evo |
| By: | Gabrielle Demange (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | In a world with a tremendous amount of choices, ranking systems are becoming increasingly important in helping individuals to find information relevant to them. As such, rankings play a crucial role of influencing the attention that is devoted to the various alternatives. This role generates a feedback when the ranking is based on citations, as is the case for PageRank used by Google. The attention bias due to published rankings affects new stated opinions (citations), which will, in turn, affect the next ranking. The purpose of this paper is to investigate this feedback by studying some simple but reasonable dynamics. We show that the long run behavior of the process much depends on the preferences, in particular on their diversity, and on the used ranking method. Two main families of methods are investigated, one based on the notion of 'handicaps', the other one on the notion of peers' rankings. |
| Keywords: | Ranking ; Scoring ; Invariant method ; Peers' method ; Attention ; Handicap ; Scaling matrix ; Dynamics through influence |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00564982&r=evo |