nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2013‒04‒06
eleven papers chosen by
Matthew Baker
City University of New York

  1. Cooperation, Trust, and Economic Development: An Experimental Study in China By Junyi Shen; Xiangdong Qin
  2. Evolutionarily stable in-group favoritism and out-group spite in intergroup conflict By Konrad, Kai A.; Morath, Florian
  3. Social Information and Charitable Giving: An artefactual field experiment with young children and adolescents By Guzmán, Andrea; Villegas-Palacio, Clara; Wollbrant, Conny
  4. Understanding the Nature of Cooperation Variability By Fosgaard, Toke; Hansen , Lars Gårn; Wengström, Erik
  5. Incomplete Information about Social Preferences Explains Equal Division and Delay in Bargaining. By KOHLER, Stefan
  6. Variants of the Monoamine Oxidase A Gene (MAOA) Predict Free-riding Behavior in Women in a Strategic Public Goods Experiment By Vanessa Mertins; Andrea B. Schote; Jobst Meyer
  7. Stochastic stability in finite extensive-form games of perfect information By Xu, Zibo
  8. Natural and Economic Selection - Lessons from the Evo-Devo and Multilevel Selection Debate By Georg Schwesinger
  9. Time to abandon group thinking in economics By Da Silva, Sergio
  10. Regime shifts in a social-ecological system By Steven J. Lade; Alessandro Tavoni; Simon A. Levin; Maja Schlüter
  11. The Economic Effects of the Protestant Reformation: Testing the Weber Hypothesis in the German Lands By Cantoni, Davide

  1. By: Junyi Shen (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan); Xiangdong Qin (School of Economics, Shanghai Jiao Tong University, China)
    Abstract: Many previous empirical studies have suggested that cooperation and trust affect economic growth. However, the precise relationship between trust and cooperation (i.e., whether trust leads to cooperation or cooperation leads to trust) remains unclear and it is not known how the level of economic development affects the level of cooperation and trust. Using a combination of public goods experiment, gambling game experiment, and trust game experiment, we investigate the links among cooperation, trust, and economic development in four regions of China. Our results suggest that first, there is a U-shaped or V-shaped relationship between cooperation and economic development; second, on the one hand, cooperation leads to trust, and on the other hand, more cooperative behavior may be created by rewarding trusting behavior; and third, men are more cooperative and trusting than women. Furthermore, we find that the widely used 'GSS trust' question from the General Social Survey (GSS) does not predict either cooperation or trust, whereas the questions 'GSS fair' and 'GSS help' have weak predictive power for trusting behavior but not for cooperative behavior.
    Keywords: Cooperation, Trust, Economic development, Experiment, China
    JEL: C91 H41 I32
    Date: 2013–04
  2. By: Konrad, Kai A.; Morath, Florian
    Abstract: We study conflict between two groups of individuals. Using Schaffer`s (1988) concept of evolutionary stability we provide an evolutionary underpinning for in-group altruism combined with spiteful behavior towards members of the rival out-group. We characterize the set of evolutionarily stable combinations of in-group favoritism and out-group spite and find that an increase in in-group altruism can be balanced by a decrease in spiteful behavior towards the out-group.
    Keywords: altruism; spite; in-group favoritism; conflict; evolutionary stability; indirect evolutionary approach
    Date: 2012
  3. By: Guzmán, Andrea (Universidad Nacional de Colombia-Sede Medellin); Villegas-Palacio, Clara (Universidad Nacional de Colombia-Sede Medellin); Wollbrant, Conny (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: A growing literature in economics examines the development of preferences among children and adolescents. This paper combines a repeated dictator game with treatments that either provides participants with information about the average behavior of others or not. Collecting data on 384 children aged 5-17, we find that sensitivity to social information is present already in early life and that information about others’ donations can reduce, but primarily increases donations.<p>
    Keywords: Children; Charitable giving; Social information; Preference development
    JEL: C93 D02 D03 D64
    Date: 2013–03–27
  4. By: Fosgaard, Toke (Department of Food and Resource Economics, University of Copenhagen); Hansen , Lars Gårn (Department of Food and Resource Economics, University of Copenhagen); Wengström, Erik (Department of Economics, Lund University)
    Abstract: We investigate framing effects in a large-scale public good experiment. We measure indicators of explanations previously proposed in the literature, which when combined with the large sample, enable us to estimate a structural model of framing effects. The model captures potential causal effects and the behavioral heterogeneity of cooperation variability. We find that framing only has a small effect on the average level of cooperation but a substantial effect on behavioral heterogeneity and we show that this can be explained almost exclusively by a corresponding change in the heterogeneity of beliefs about other subjects’ behavior. Preferences are on the other hand stable between frames.
    Keywords: Framing; Public Goods; Internet Experiment; Simulation
    JEL: C13 C71 C93 H41
    Date: 2013–03–19
  5. By: KOHLER, Stefan
    Abstract: Two deviations of alternating-offer bargaining behavior from economic theory are observed together, yet have been studied separately. Players who could secure themselves a large surplus share if bargainers were purely self-interested incompletely exploit their advantage. Delay in agreement occurs even if all experimentally controlled information is common knowledge. This paper rationalizes both regularities coherently by modeling heterogeneous social preferences, either self-interest or envy, of one bargaining party as private information in a three period game of bargaining and preference screening and signaling.
    Date: 2012
  6. By: Vanessa Mertins (Institute for Labour Law and Industrial Relations in the EU, University of Trier); Andrea B. Schote; Jobst Meyer
    Abstract: Laboratory experiments have documented substantial heterogeneity in social preferences, but little is known about the origins of such behavior. Previous research on public goods experiments suggests that individual-level demographic and psychological variables correlate with player types. However, the key question about biological sources of variation in these preferences remains open. The aim of this study is to uncover genetic variations that influence differences in cooperative behavior. For this reason, we identify types of players within a strategic public goods experiment. We explicitly test for an association between individual variance in strategy choice and the functional promoter-region repeat of the monoamine oxidase A gene (MAOA). Our experimental findings suggest a link between MAOA and the occurrence of free-riding in females. Females with MAOA-L are less likely to behave like weak free-riders than MAOA-H carriers, whereas among males, our results did not support a significant relation between genotype and player type. Furthermore, MAOA-L female carriers contribute more than MAOA-H subjects to the public good if they know that others contribute nothing, and they showed slightly lower scores on the Machiavellianism scale. This is the first piece of evidence that genotype might predict player type within a public goods setting. It contributes to our understanding of biological drivers of economic decision-making and points to the need for further exploration.
    Keywords: gene, player type, public good, conditional cooperation, experimental economics
    JEL: H41 D87 C91 C72
    Date: 2013–02
  7. By: Xu, Zibo (Dept. of Economic Statistics, Stockholm School of Economics)
    Abstract: We consider a basic stochastic evolutionary model with rare mutation and a best-reply (or better-reply) selection mechanism. Following Young's papers, we call a state stochastically stable if its long-term relative frequency of occurrence is bounded away from zero as the mutation rate decreases to zero. We prove that, for all finite extensive-form games of perfect information, the best-reply dynamic converges to a Nash equilibrium almost surely. Moreover, only Nash equilibria can be stochastically stable. We present a `centipede-trust game', where we prove that both the backward induction equilibrium component and the Pareto-dominant equilibrium component are stochastically stable, even when the populations increase to infinity. For finite extensive-form games of perfect information, we give a sufficient condition for stochastic stability of the set of non-backward-induction equilibria, and show how much extra payoff is needed to turn an equilibrium stochastically stable.
    Keywords: Evolutionary game theory; Markov chains; equilibrium selection; stochastic stability; games in extensive form; games of perfect information; backward induction equilibrium; Nash equilibrium components; best-reply dynamics.
    JEL: C61 C62 C73
    Date: 2013–03–21
  8. By: Georg Schwesinger (University of Bremen)
    Abstract: This paper sheds new light on the concept of selection in evolutionary economics. The interpretation of natural evolution has experienced significant changes in the last decades, while these developments have been often ignored by economists. This is especially true for the concept of selection, a key concept in many evolutionary approaches. In economics as well as in biology, selection is seen as a central mechanism, which mediates for example the spread of information and innovation, the coordination of groups of agents and the optimization of their behavior. In this article we are aiming to explore the actual significance of selection as a major explanatory principle in economics. Starting with an analysis of a modern and modified understanding of the selection mechanism in nature we will draw some conclusions for its use in economics.
    Keywords: Selection, Bioeconomics, Evo-Devo, Cultural Evolution, Multilevel Selection, Economic Theory
    JEL: B15 B40 B52 D03
    Date: 2013–04–03
  9. By: Da Silva, Sergio
    Abstract: Group thinking is the notion that animals do those things that maximize the chance of survival of their species. It is wrong because natural selection does not favor what is good for the group or the species; it favors what is good for the individual. Here, I show through examples how group thinking also pervades economics. In connection with the fallacy of group thinking, I also discuss how economics fails to ground itself in the underlying knowledge provided by biology. I also argue that economists need to redirect their conventional approach to study group behavior. Current macroeconomics is reductionist while the route followed by biology, physics, and chemistry was to resort to a different approach when focusing on macro systems made up of a large number of heterogeneous micro units. The group level pattern self-organizes as it is not encoded directly in the individual-level rules. And here the right mathematical models can help deduce hidden connections between the interactions of individuals and the patterns that emerge at the group level.
    Keywords: group thinking, biology, economics
    JEL: B41 D7 Y8
    Date: 2013
  10. By: Steven J. Lade; Alessandro Tavoni; Simon A. Levin; Maja Schlüter
    Abstract: Ecological regime shifts are rarely purely ecological. Not only is the regime shift frequently triggered by human activity, but the responses of relevant actors to ecological dynamics are often crucial to the development and even existence of the regime shift. Here,we show that the dynamics of human behaviour in response to ecological changes can be crucial in determining the overall dynamics of the system. We find a social-ecological regime shift in a model of harvesters of a common-pool resource who avoid over-exploitation of the resource by social ostracism of non-complying harvesters. The regime shift, which can be triggered by several different drivers individually or also in combination, consists of a breakdown of the social norm, sudden collapse of co-operation and an over-exploitation of the resource. We use the approach of generalised modelling to study the robustness of the regime shift to uncertainty over the specific forms of model components such as the ostracism norm and the resource dynamics. Importantly, the regime shift in our model does not occur if the dynamics of harvester behaviour are not included in the model. Finally, we sketch some possible early warning signals for the social-ecological regime shifts we observe in the models.
    Date: 2013–02
  11. By: Cantoni, Davide
    Abstract: Following Max Weber, many theories have hypothesized that Protestantism should have favored economic development. With its religious heterogeneity, the Holy Roman Empire presents an ideal testing ground for this hypothesis. Using population figures of 272 cities in the years 1300–1900, I find no effects of Protestantism on economic growth. The finding is precisely estimated, robust to the inclusion of various controls, and does not depend on data selection or small sample size. Protestantism has no effect when interacted with other likely determinants of economic development. Instrumental variables estimates, considering the potential endogeneity of religious choice, are similar to the OLS results.
    Keywords: Protestantism; Culture; Economic Growth; Historical Development;Germany
    JEL: N13 N33 O11 Z12
    Date: 2013–03

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