nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2016‒01‒18
six papers chosen by
Matthew Baker
City University of New York

  1. Why Sex? and Why Only in Pairs? By Perry, Motty; Reny, Philip J.; Robson, Arthur J.
  2. Higher Intelligence Groups Have Higher Cooperation Rates in the Repeated Prisoner's Dilemma By Proto, Eugenio; Rustichini, Aldo; Sofianos, Andis
  3. Psychology of Trust: A Three Component Analytical Framework to Explain the Impact of Formal Institutions on Social Trust Formation By Tamilina, Larysa; Tamilina, Natalya
  4. The Many Faces of Human Sociality: Uncovering the Distribution and Stability of Social Preferences By Adrian Bruhin; Ernst Fehr; Daniel Schunk
  5. Instrumental Variables in the Long Run By Casey, Gregory; Klemp, Marc
  6. Causes and Consequences of the Protestant Reformation By Becker, Sascha O; Pfaff, Steven; Rubin, Jared

  1. By: Perry, Motty (Department of Economics, University of Warwick); Reny, Philip J. (Department of Economics, The University of Chicago); Robson, Arthur J. (Department of Economics, Simon Fraser University)
    Abstract: Understanding the purpose of sex remains one of the most important unresolved problems in evolutionary biology. The difficulty is not that there are too few theories of sex, the difficulty is that there are too many and none stand out. To distinguish between theories we suggest the following question: Why are there no triparental species in which an offspring is composed of the genetic material of three individuals? A successful theory should confer an advantage to biparental sex over asexual reproduction without conferring an even greater advantage to triparental sex. We pose our question in the context of two leading theories of sex, the (deterministic) mutational hypothesis that sex reduces the rate at which harmful mutations accumulate, and the red queen hypothesis that sex reduces the impact of parasitic attack by increasing genotypic variability. We show that the mutational hypothesis fails to provide an answer to the question because it implies that triparental sex dominates biparental sex, so the latter should never be observed. In contrast, we show that the red queen hypothesis is able to explain biparental sex without conferring an even greater advantage to triparental sex.
    Date: 2015
  2. By: Proto, Eugenio (Department of Economics, University of Warwick); Rustichini, Aldo (Department of Economics, University of Minnesota); Sofianos, Andis (Department of Economics, University of Warwick)
    Abstract: Intelligence affects the social outcomes of groups. A systematic study of the link is provided in an experiment where two groups of subjects with different levels of intelligence, but otherwise similar, play a repeated prisoner's dilemma. Initial cooperation rates are similar, but increase in the groups with higher intelligence to reach almost full cooperation, while they decline in the groups with lower intelligence. Cooperation of higher intelligence subjects is payo sensitive and not automatic: in a treatment with lower continuation probability there is no difference between different intelligence groups.
    Keywords: Repeated Prisoner's Dilemma ; Cooperation ; Intelligence
    JEL: C73 C91 C92
    Date: 2015
  3. By: Tamilina, Larysa; Tamilina, Natalya
    Abstract: Drawing on a social-cognitive theory of psychology, this study introduces a new conceptual framework to explain trust building by individuals and the role that formal rules and laws may play in this process. Trust is viewed as composed of cultural, communal, and contextual components, with the latter encompassing formal institutions. We demonstrate that the contextual component measured through three institutional indexes is the strongest predictor of social trust that may not only condition the importance of cultural and communal components for the process of trust formation, but also trigger changes in them. We also furnish evidence that this impact may vary across formal institutional types and suggest that the autonomy dimension of the institutional framework is particularly important for social trust building.
    Keywords: interpersonal trust, trust formation, formal institutions, social-cognitive psychology
    JEL: K40 Z13
    Date: 2015–02–10
  4. By: Adrian Bruhin (University of Lausanne); Ernst Fehr (University of Zurich); Daniel Schunk (Johannes Gutenberg University of Mainz)
    Abstract: There is vast heterogeneity in the human willingness to weigh others’ interests in decision making. This heterogeneity concerns the motivational intricacies as well as the strength of other-regarding behaviors, and raises the question how one can parsimoniously model and characterize heterogeneity across several dimensions of social preferences while still being able to predict behavior over time and across situations. We tackle this task with an experiment and a structural model of preferences that allows us to simultaneously estimate outcome-based and reciprocity-based social preferences. We find that non-selfish preferences are the rule rather than the exception. Neither at the level of the representative agent nor when we allow for several preference types do purely selfish types emerge. Instead, three temporally stable and qualitatively different other-regarding types emerge endogenously, i.e., without pre-specifying assumptions about the characteristics of types. When ahead, all three types value others’ payoffs significantly more than when behind. The first type, which we denote as strongly altruistic type, is characterized by a relatively large weight on others’ payoffs – even when behind – and moderate levels of reciprocity. The second type, denoted as moderately altruistic type, also puts positive weight on others’ payoff, yet at a considerable lower level, and displays no positive reciprocity while the third type is behindness averse, i.e., puts a large negative weight on others’ payoffs when behind and behaves selfishly otherwise. We also find that there is an unambiguous and temporally stable assignment of individuals to types. Moreover, the three-type model substantially improves the (out-of-sample) predictions of individuals’ behavior across additional games while the information contained in subject-specific parameter estimates leads to no or only minor additional predictive power. This suggests that a parsimonious model with three types captures the bulk of the predictive power contained in the preference estimates.
    Keywords: Social Preferences, Heterogeneity, Stability, Finite Mixture Models
    JEL: C49 C91 D03
    Date: 2016–01–04
  5. By: Casey, Gregory; Klemp, Marc
    Abstract: In the field of long-run economic growth, it is common to use historical or geographical variables as instruments for contemporary endogenous regressors. We study the interpretation of these conventional instrumental variable (IV) regressions in a simple, but general, framework. We are interested in estimating the long-run causal effect of changes in historical conditions. For this purpose, we develop an augmented IV estimator that accounts for the degree of persistence in the endogenous regressor. We apply our results to estimate the long-run effect of institutions on economic performance. Using panel data, we find that institutional characteristics are imperfectly persistent, implying that conventional IV regressions overestimate the long-run causal effect of institutions. When applying our augmented estimator, we find that increasing constraints on executive power from the lowest to the highest level on the standard index increases national income per capita three centuries later by 1.2 standard deviations.
    Keywords: Long-Run Economic Growth, Instrumental Variable Regression
    JEL: C10 C3 C30 O10 O40
    Date: 2016–01–07
  6. By: Becker, Sascha O (Department of Economics, University of Warwick); Pfaff, Steven (University of Washington); Rubin, Jared (Chapman University)
    Abstract: The Protestant Reformation is one of the defining events of the last millennium. Nearly 500 years after the Reformation, its causes and consequences have seen a renewed interest in the social sciences. Research in economics, sociology, and political science increasingly uses detailed individual-level, city-level, and regional-level data to identify drivers of the adoption of the Reformation, its diffusion pattern, and its socioeconomic consequences. This survey takes stock of the research so far, tries to point out what we know and what we do not know, and which are the most promising areas for future research.
    Keywords: Protestant Reformation
    JEL: N33 Z12 R38 D85
    Date: 2016

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