nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2014‒05‒24
six papers chosen by
Matthew Baker
City University of New York

  1. On Stable Equilibria in Discrete-Space Social Interaction Models By Akamatsu, Takashi; Fujishima, Shota; Takayama, Yuki
  2. Contribution of ICT on Labor Market Polarization: an Evolutionary Approach By Benjamin David
  3. Co-evolutionary patterns in regional knowledge bases and economic structure: evidence from European Regions By Francesco Quatraro
  4. Economics breeds culture By Patricio Garcia-Minguez; Ausias Ribo Argemi
  5. Population growth and human capital: a welfarist approach By Thomas Renstrom; Luca Spataro
  6. Bounded Computational Capacity Equilibrium By Eilon Solan; Penélope Hernández

  1. By: Akamatsu, Takashi; Fujishima, Shota; Takayama, Yuki
    Abstract: We investigate the differences and connections between discrete-space and continuous-space social interaction models. Although our class of continuous-space model has a unique equilibrium, we find that discretized models can have multiple equilibria for any degree of discretization, which necessitates a stability analysis of equilibria. We present a general framework for characterizations of equilibria and their stability under a broad class of evolutionary dynamics by using the properties of a potential game. Although the equilibrium population distribution in the continuous space is uniquely given by a symmetric unimodal distribution, we find that such a distribution is not always stable in a discrete space. On the other hand, we also show that any sequence of a discrete-space model's equilibria converges with the continuous-space model's unique equilibrium as the discretization is refined.
    Keywords: Social interaction; Agglomeration; Discrete space; Potential game; Stability; Evolutionary game theory
    JEL: C62 C72 C73 D62 R12
    Date: 2014–05–08
  2. By: Benjamin David
    Abstract: This paper analyses the role of Information and Communication Technologies (ICT) on the job market polarization. We rely on an evolutionary framework by applying a “distance from mean approach”. Using data for 8 industrialized economies, we account for probable heterogeneous and timevarying effects through the estimation of a semi parametric smooth coefficient model. Our results show a significant contribution of ICT on polarization dynamics with some differences between countries and industries. We also find evidence that diffusion of ICT is initially accompanied by a Skill Bias Technological Change (SBTC), then contributing to job market polarization. Finally, our findings highlight a progressive weakening of the positive link between ICT diffusion and the increasing demand for high-skilled workers over time.
    Keywords: ICT, Evolutionary economics, Polarization of labor market, Semiparametric Smooth Coefficient Model.
    JEL: C14 E11 J21 O33
    Date: 2014
  3. By: Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS))
    Abstract: This paper presents an analysis of the co-evolutionary patterns of structural change in knowledge and economics. The former is made operational through an analysis of co-occurrences of technological classes in patent documents in order to derive indicators of coherence, variety and cognitive distance. The latter, on the other hand, is made operational in a synthetic way by implementing shift share analysis which decomposes labour productivity growth into effects caused by changes in the allocation of employment, those ascribed to intra-sector productivity growth and those caused by interaction of these two components. The results of the analysis conducted on a sample of 227 European regions show that increasing variety is associated with the reallocation of workforce across sectors whereas within sector productivity is associated with high levels of both coherence and cognitive distance of the regional knowledge base.
    Keywords: Recombinant Knowledge, Coherence, Variety, Regional Structural Change, Shift Share Analysis
    Date: 2013–11–04
  4. By: Patricio Garcia-Minguez (Facultat d'Economia i Empresa; Universitat de Barcelona (UB)); Ausias Ribo Argemi (Facultat d'Economia i Empresa; Universitat de Barcelona (UB))
    Abstract: Several recent papers document the influence and long lasting effects oftechnology on preferences. Simultaneously, cultural factors are often invoked to explain heterogeneity in preferences. These two ideas suggest that culture determines the short run equilibrium values of economic variables, but, in the long run, culture changes in response to the underlying economic fundamentals. We build a model in which preferences are endogenous and the diversity in preferences (the "cultural" diversity) is explained by the variation in the relevant economic fundamentals. This can help explain observed differences in labor market attachment among groups defined e.g., by citizenship, ethnicity or gender.
    Keywords: Endogenous Preferences, Technology, Culture, Labor market participation, Taxes.
    JEL: D01 J22 J3 Z10
    Date: 2014
  5. By: Thomas Renstrom (University of Durham (UK)); Luca Spataro (Dipartimento di Economia e Management, University of Pisa (Italy))
    Abstract: In this paper we investigate the relationship between economic and population growth in an endogenous growth model driven by human capital accumulation à la Lucas (1988). Since we allow for endogenous population growth, we adopt the population criterion Relative Critical Level Utilitarianism (an extension of Critical Level Utilitarianism, Blackorby et al. 1995) which allows axiomatically founded welfare orderings under variable population. Under this extension the Critical Level Utility is dependent on parents’ wellbeing. In this scenario we investigate the equilibrium relation between economic growth and population growth as functions of the underlying parameters and we provide the conditions for the economic take-off to occur.
    Keywords: population growth, endogenous growth, human capital, critical level utilitarianism
    JEL: D6 J11 O41
    Date: 2014–05
  6. By: Eilon Solan (Tel Aviv University); Penélope Hernández (ERI-CES)
    Abstract: A celebrated result of Abreu and Rubinstein [1] states that in repeated games, when the players are restricted to playing strategies that can be im- plemented by fnite automata and they have lexicographic preferences, the set of equilibrium payoffs is a strict subset of the set of feasible and individually rational payoffs. In this paper we explore the limitations of this result. We prove that if memory size is costly and players can use mixed automata, then a folk theorem obtains and the set of equilibrium payo is once again the set of feasible and individually rational payoffs. Our result emphasizes the role of memory cost and of mixing when players have bounded computational power
    Keywords: Bounded rationality, automata, complexity, infnitely repeated games, equilibrium.
    Date: 2014–05

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