nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2015‒11‒21
seven papers chosen by
Matthew Baker
City University of New York

  1. Islam, Inequality and Pre-Industrial Comparative Development By Stelios Michalopoulos; Alireza Naghavi; Giovanni Prarolo
  2. Strength and Positivity of Religious Identification as Predictors of the Attitude Toward Economic Involvement Among Orthodox Christians and Sunni Muslims in Russia By Maria Efremova; Zarina Lepshokova
  3. The beauty of simplicity? (Simple) heuristics and the opportunities yet to be realized By Andreas Ortmann; Leonidas Spiliopoulos
  4. Socially Optimal Child-Related Transfers and Personal Income Tax with Endogenous Fertility By Andras Simonovits
  5. Shifting Boundaries in Economics: the Institutional Cognitive Strand By Ambrosino, Angela; Fontana, Magda; Gigante, Anna Azzurra
  6. Surnames and social mobility in England, 1170–2012 By Gregory Clark; Neil Cummins
  7. Roots of the Industrial Revolution By Morgan Kelly; Joel Mokyr; Cormac Ó Gráda

  1. By: Stelios Michalopoulos (Brown University and the NBER); Alireza Naghavi (University of Bologna and Centro Studi Luca d'Agliano); Giovanni Prarolo (University of Bologna)
    Abstract: This study explores the interaction between trade and geography in shaping the Islamic economic doctrine and in turn the comparative development of the Muslim world. We build a model where an unequal distribution of land quality in presence of trade opportunities conferred differential gains from trade across regions, fostering predatory behavior from the poorly endowed ones. We show that in such an environment it was mutually beneficial to institute an economic system of income redistribution featuring direct income transfers in return for safe passage to conduct trade. A com-mitment problem, however, rendered a merely static redistribution system unsustainable. Islam add-ed a set of dynamic redistributive rules that were self-enforcing under large gains from trade and high proportions of arid land. While such principles fostered the expansion of trade within the Mus-lim world they limited the accumulation of wealth by the commercial elite, shaping the economic trajectory of Islamic lands in the preindustrial era.
    Keywords: Religion, Islam, Geography, Inequality in land quality, Wealth accumulation, Public good investment, Trade, Conflict.
    JEL: O10 O13 O16 O17 O18 F10 Z12
  2. By: Maria Efremova (National Research University Higher School of Economics); Zarina Lepshokova (National Research University Higher School of Economics)
    Abstract: This study presents the results of empirical research on the relationship between strength and positivity of religious identification and attitudes towards economic behaviour in a group of Orthodox Christians and Sunni Muslims in Russia (N=820). In order to measure strength and positivity of religious identification, we constructed scales based on the theory of social identity. Attitudes toward models of economic behaviour were measured using methodology to measure economic attitudes based on the scenario approach. The results revealed that attitudes towards three models of economic behaviour form a single factor of economic involvement. In addition, generalized economic involvement was confirmed by a simultaneous CFA in both religious groups. In our study we found that strength and positivity of religious identification are differently associated with the attitudes toward economic involvement. Thus, it was concluded that the strength of religious identification is not conducive to attitudes reflecting economic involvement. Positivity of religious identification was found to have a positive effect on economic involvement attitudes. However, further analysis demonstrated that the relationship between positivity of religious identification and economic involvement had interfaith specifics: positivity of religious identification was positively related to the models of economic involvement only in the group of Christians, while in the group of Muslims, this relationship is insignificant. The results are discussed in terms of features of religious identification in these two groups
    Keywords: religious identification, strength of religious identification, positivity of religious identification, economic attitudes, models of economic behaviour, economic involvement, Orthodox Christians, Sunni Muslims.
    JEL: Z
    Date: 2015
  3. By: Andreas Ortmann (School of Economics, UNSW Business School, UNSW); Leonidas Spiliopoulos (Center for Adaptive Rationality, Max Planck Institute for Human Development, Berlin, Germany)
    Abstract: Heuristics are all around us, both in the real world and the literature. There are many of them and there are many—too many—definitions of them. In this chapter we focus on the history of fast and frugal heuristics, as sketched out comprehensively in Gigerenzer, Todd, & the ABC Research Group (1999) and scores of follow-up books. Specifically, we contextualize the emergence of the “Ecological-Rationality” program as an explicit counterpoint to the “Heuristics-and-Biases” program initiated by Kahneman and Tversky that informed and inspired scores of early behavioural economists. Simple heuristics are here understood to be fast and frugal rules of thumb because they ignore information that is available. Also, they ought to reflect cognitive processes (and hence be able to predict) rather than be as-if modelling exercises that explain ex post. We first review in more detail how this battle of programs unfolded and then a) lay out what we consider the considerable accomplishments of the ER program, b) point out some overlooked connections between the ER program and economics, and c) enumerate what we consider to be open questions and challenges.
    Keywords: heuristics, simple heuristics, simplicity, model selection, beauty
    JEL: B20 B41 C02 C18 D01 D03
    Date: 2015–10
  4. By: Andras Simonovits (Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences also Mathematical Institute of Budapest University of Technology and Department of Economics of CEU)
    Abstract: To compare the systems of child benefits and of family tax deductions, we create a model with endogenous fertility and basic income, also financed from proportional wage taxes. Pensioners are neglected but younger and older workers are distinguished: the former raise children and receive child benefits, while the latter not. Through the balance equation, current average fertility depends on past average fertility. To have a socially optimal positive child benefit, past average fertility has to be less than 1. The deduction's efficiency is presumably lower than the benefit's and may even be lower than that of pure basic income.
    Keywords: progressive income tax, child benefits, family tax deductions, endogenous fertility
    JEL: J13
    Date: 2015–07
  5. By: Ambrosino, Angela; Fontana, Magda; Gigante, Anna Azzurra (University of Turin)
    Abstract: The paper proposes a critical interpretation of the development of new institutional economics and of its relationship with other economic fields. Consistently with the oil-spot dynamics model, new institutionalism can be described as an enlargement of the mainstream that, in time, seems to further expand towards heterodoxy by branching and specializing. Institutional cognitive economics positions itself at the borders between these two areas. With its focus on the cognitive processes underlying institutional genesis and evolution, it is the result of the integration process between the ideas of new (D.C. North’s in particular) and old institutionalism (T. Veblen’s in particular) plus the injection of F. Hayek’s theories on the link between mind and institutions. Institutional cognitive economics also represents an example of interdisciplinary cross-fertilization that is taking place at the border of social sciences and that might represent the future of our discipline.
    Date: 2015–11
  6. By: Gregory Clark; Neil Cummins
    Abstract: Using educational status in England from 1170 to 2012, we show that the rate of social mobility in any society can be estimated from knowledge of just two facts: the distribution over time of surnames in the society and the distribution of surnames among an elite or underclass. Such surname measures reveal that the typical estimate of parent–child correlations in socioeconomic measures in the range of 0.2–0.6 are misleading about rates of overall social mobility. Measuring education status through Oxbridge attendance suggests a generalized intergenerational correlation in status in the range of 0.70–0.90. Social status is more strongly inherited even than height. This correlation is unchanged over centuries. Social mobility in England in 2012 was little greater than in preindustrial times. Thus there are indications of an underlying social physics surprisingly immune to government intervention.
    Keywords: social mobility; intergenerational correlation; status inheritance
    JEL: N0
    Date: 2014–12
  7. By: Morgan Kelly; Joel Mokyr; Cormac Ó Gráda
    Abstract: We analyze factors explaining the very different patterns of industrialization across the 42 counties of England between 1760 and 1830. Against the widespread view that high wages and cheap coal drove industrialization, we find that industrialization was restricted to low wage areas, while energy availability (coal or water) had little impact Instead we find that industrialization can largely be explained by two factors related to the human capability of the labour force. Instead of being composed of landless labourers, successful industrializers had large numbers of small farms, which are associated with better nutrition and height. Secondly, industrializing counties had a high density of population relative to agricultural land, indicating extensive rural industrial activity: counties that were already reliant on small scale industry, with the technical and entrepreneurial skills this generated, experienced the strongest industrial growth. Looking at 1830s France we find that the strongest predictor of industrialization again is quality of workers shown by height of the population, although market access and availability of water power were also important.
    Keywords: Industrial revolution; Economic history; Economic growth
    JEL: N N13 O52
    Date: 2015–10

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