nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2014‒03‒30
five papers chosen by
Matthew Baker
City University of New York

  1. Inclusive Fitness Maximization: An Axiomatic Approach By OKASHA, Samir; WEYMARK, John A.; BOSSERT, Walter
  2. On the economics of others By Stark, Oded
  3. The laws of imitation and invention: Gabriel Tarde and the evolutionary economics of innovation By Faridah Djellal; Faïz Gallouj
  4. Cross Cultural Differences in Decisions from Experience: Evidence from Denmark, Israel and Taiwain By Sibilla Di Guida; Ido Erev; Davide Marchiori
  5. Behavioral and Network Origins of Wealth Inequality: Insights from a Virtual World By Benedikt Fuchs; Stefan Thurner

  1. By: OKASHA, Samir; WEYMARK, John A.; BOSSERT, Walter
    Abstract: Kin selection theorists argue that evolution in social contexts will lead organisms to behave as if maximizing their inclusive, as opposed to personal, fitness. The inclusive fitness concept allows biologists to treat organisms as akin to rational agents seeking to maximize a utility function. Here we develop this idea and place it on a firm footing by employing a standard decision-theoretic methodology. We show how the principle of inclusive fitness maximization and a related principle of quasi-inclusive fitness maximization can be derived from axioms on an individual’s ‘as if preferences’ (binary choices). Our results help integrate evolutionary theory and rational choice theory, help draw out the behavioural implications of inclusive fitness maximization, and point to a possible way in which evolution could lead organisms to implement it.
    Keywords: Hamilton’s rule, inclusive fitness, kin selection, rational choice.
    Date: 2013
  2. By: Stark, Oded
    Abstract: We relate to others in two important ways: we care about others, and we care about how we fare in comparison to others. In some contexts, these two forms of relatedness interact. Caring about others can conveniently be labeled altruism. Caring about how we fare in comparison with others who fare better than ourselves can conveniently be labeled relative deprivation. I provide examples of domains in which the incorporation of altruism and relative deprivation can point to novel perspectives and suggest rethinking, and possibly revising, long-held views. And I show that there are domains in which consideration of relative deprivation can substitute for the prevalence of altruism, and vice versa. I conclude that this is a fascinating sphere for research on economics and social behavior.
    Keywords: Altruism, Relative deprivation, Economic and social behavior, Consumer/Household Economics, Institutional and Behavioral Economics, International Development, D01, D03, D13, D31, D63, D64, F22, F24, J61, O15,
    Date: 2014–03
  3. By: Faridah Djellal (CLERSE - Centre lillois d'études et de recherches sociologiques et économiques - CNRS : UMR8019 - Université Lille I - Sciences et technologies); Faïz Gallouj (CLERSE - Centre lillois d'études et de recherches sociologiques et économiques - CNRS : UMR8019 - Université Lille I - Sciences et technologies)
    Abstract: Gabriel Tarde was a French sociologist and criminologist whose work is rediscovered from time to time. Economists of innovation have paid insufficient attention to an author who devoted a large part of his work to the laws of imitation and invention. The purpose of this paper is threefold. The first is to give a succinct account of these laws of imitation and invention. The second is to re-examine and extend the debates on the similarities between Schumpeter and Tarde. The third and main purpose is to examine the similarities, hitherto unexplored to the best of our knowledge, between Tarde's work and contemporary neo-Schumpteterian and evolutionary theories.
    Keywords: Tarde, Schumpeter, evolutionary theory, innovation, imitation.
    Date: 2014–03–18
  4. By: Sibilla Di Guida; Ido Erev; Davide Marchiori
    Abstract: This paper examines the effects of different cultural backgrounds on decisions from experience. In Experiment 1, participants from Denmark, Israel, and Taiwan faced each of six binary choice problems for 200 trials. The participants did not receive prior description of the payoff distributions, but obtained complete feedback after each choice. Comparison of choice behavior across cultural groups reveals similar overall choice rates, and similar indications of underweighting of rare events and of the payoff variability effect. In addition, subjects from Taiwan exhibited a stronger tendency to chase recent outcomes. That is, subjects from East Asia behaved “as if” they expected less change in the environment than subjects from West Asia and West Europe. Experiment 2 shows that an increase in the complexity of the choice tasks (i.e. adding slight variability to the safe option, and increasing the number of replicas for each option) does not break the similarity of choice rates across cultural groups, but reverses the observed chasing pattern: In Experiment 2, Israeli participants tended to chase recent outcomes more than did the Taiwanese. These results can be summarized with the assumption that the tendency to rely of small samples of past experiences (a sufficient condition for underweighting of rare events and the payoff variability effect) is robust to cultural differences, but the exact sampling process is culture- and framing-specific. An increase in the number of possible outcomes increases the probability of sampling the most recent trial in the West, but not in the East. Thus, behavior in the East appears less sensitive to task complexity.
    Keywords: cross cultural decision making; rare events; decisions from experience; clicking paradigm; recency effect
    Date: 2014–03
  5. By: Benedikt Fuchs; Stefan Thurner
    Abstract: Almost universally, wealth is not distributed uniformly within societies or economies. Even though wealth data have been collected in various forms for centuries, the origins for the observed wealth-disparity and social inequality are not yet fully understood. Especially the impact and connections of human behavior on wealth could so far not be inferred from data. Here we study wealth data from the virtual economy of the massive multiplayer online game (MMOG) Pardus. This data not only contains every player's wealth at every point in time, but also all actions of every player over a timespan of almost a decade. We find that wealth distributions in the virtual world are very similar to those in western countries. In particular we find an approximate exponential for low wealth and a power-law tail. The Gini index is found to be $g=0.65$, which is close to the indices of many Western countries. We find that wealth-increase rates depend on the time when players entered the game. Players that entered the game early on tend to have remarkably higher wealth-increase rates than those who joined later. Studying the players' positions within their social networks, we find that the local position in the trade network is most relevant for wealth. Wealthy people have high in- and out-degree in the trade network, relatively low nearest-neighbor degree and a low clustering coefficient. Wealthy players have many mutual friendships and are socially well respected by others, but spend more time on business than on socializing. We find that players that are not organized within social groups with at least three members are significantly poorer on average. We observe that high `political' status and high wealth go hand in hand. Wealthy players have few personal enemies, but show animosity towards players that behave as public enemies.
    Date: 2014–03

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