nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2016‒04‒04
seven papers chosen by
Matthew Baker
City University of New York

  1. Preference purification and the inner rational agent: A critique of the conventional wisdom of behavioural welfare economics By Gerardo Infante; Guilhem Lecouteux; Robert Sugden
  2. Online Networks, Social Interaction and Segregation: An Evolutionary Approach By Angelo Antoci; Fabio Sabatini; Francesco Sarracino
  3. Cultural Leaders and the Dynamics of Assimilation By Verdier, Thierry; Zenou, Yves
  4. Family Inequality: Diverging Patterns in Marriage, Cohabitation, and Childbearing By Shelly Lundberg; Robert A. Pollak; Jenna E. Stearns
  5. Population Aging and Inventive Activity By Andreas Irmen; Anastasia Litina
  6. Networks in Economics: A Perspective on the Literature By Sanjeev Goyal; ; ;
  7. Religious Differences and Civil War By Metin M. Cosgel; Thomas J. Miceli; Sadullah Yıldırım

  1. By: Gerardo Infante (University of East Anglia); Guilhem Lecouteux (Ecole Polytechnique); Robert Sugden (University of East Anglia)
    Abstract: Neoclassical economics assumes that individuals have stable and context-independent preferences, and uses preference-satisfaction as a normative criterion. By calling this assumption into question, behavioural findings cause fundamental problems for normative economics. A common response to these problems is to treat deviations from conventional rational-choice theory as mistakes, and to try to reconstruct the preferences that individuals would have acted on, had they reasoned correctly. We argue that this preference purification approach implicitly uses a dualistic model of the human being, in which an inner rational agent is trapped in an outer psychological shell. This model is psychologically and philosophically problematic.
    Keywords: preference purification, inner rational agent, behavioural welfare economics, libertarian paternalism, context-dependent preferences
    JEL: B41 D03 D60
    Date: 2016–02
  2. By: Angelo Antoci; Fabio Sabatini; Francesco Sarracino
    Abstract: We have developed an evolutionary game model, where agents can choose between two forms of social participation: interaction via online social networks and interaction by exclusive means of face-to-face encounters. We illustrate the societal dynamics that the model predicts, in light of the empirical evidence provided by previous literature. We then assess their welfare implications. We show that dynamics, starting from a world in which online social interaction is less gratifying than offline encounters, will lead to the extinction of the sub-population of online networks users, thereby making Facebook and alike disappear in the long run. Furthermore, we show that the higher the propensity for discrimination between the two sub-populations of socially active individuals, the greater the probability that individuals will ultimately segregate themselves, making society fall into a social poverty trap.
    Date: 2016–03
  3. By: Verdier, Thierry; Zenou, Yves
    Abstract: This paper studies the population dynamics of cultural traits in a model of intergenerational cultural transmission with perfectly-forward looking cultural leaders who compete for oblique socialization. When there is only one leader, we show that there exists a threshold size in terms of population above which the cultural leader becomes active. We then consider the competition between two forward-looking leaders and characterize the open-loop Nash equilibrium of this differential dynamic game. In terms of policy implications, we show that the policymaker should take into account the crucial interaction between the centralized transmission of cultural traits by leaders and the decentralized transmission of these traits by parents and peers and should differentiate between the short-term and long-term effects of a policy due to over-reactions or under-reactions of the different cultural groups.
    Keywords: cultural substituability; dynamic differential game.; forward-looking leaders; integration
    JEL: J13 J15 Z10
    Date: 2016–03
  4. By: Shelly Lundberg; Robert A. Pollak; Jenna E. Stearns
    Abstract: The last 60 years have seen the emergence of a dramatic socioeconomic gradient in marriage, divorce, cohabitation, and childbearing. The divide is between college graduates and others: those without four-year degrees have family patterns and trajectories very similar to those of high school graduates. We document these trends and show that, compared with college graduates, less-educated women are more likely to enter into cohabiting partnerships early and bear children while cohabiting, are less likely to transition quickly into marriage, and have much higher divorce rates. There are two broad sets of explanations for these differences. Conventional explanations focus on the diminished economic prospects of less-educated men. We propose an alternative explanation focusing on educational differences in demand for marital commitment. As the gains from traditional gender-based specialization have declined, the value of marriage has decreased relative to cohabitation, which offers many of the gains of co-residence with less commitment. We argue that college graduate parents use marriage as a commitment device to facilitate intensive joint investments in their children. For less educated couples for whom such investments are less desirable or less feasible, commitment and, hence, marriage has less value relative to cohabitation. The resulting socioeconomic divergence has implications for children and for future inequality.
    JEL: D1 H31 I3 J1 N3
    Date: 2016–03
  5. By: Andreas Irmen (CREA, Université du Luxembourg); Anastasia Litina (CREA, Université du Luxembourg)
    Abstract: This research empirically establishes and theoretically motivates the hypothesis that population aging has a hump-shaped effect on inventive activity. We estimate this hump-shaped relationship in a panel of 33 OECD countries over the period 1960-2012. The increasing part of the hump captures the awareness that population aging requires inventive activity to guarantee current and future standards of living. The decreasing part reflects the tendency of aging societies to lose dynamism and the willingness to take risks. Policy-wise our analysis suggests that raising the awareness of individuals about the consequences of population aging may facilitate the adoption of strategies and policies encouraging inventive activity and economic growth.
    Keywords: Population Aging, Inventive Activity, Panel Estimation
    JEL: J11 O31 O50 O57
    Date: 2016
  6. By: Sanjeev Goyal; ; ;
    Abstract: It is instructive to view the study of networks in economics as a shift in paradigm, in the sense of Kuhn (1962). This perspective helps us locate the innovation that networks bring to economics, appreciate different strands of the research, assess the current state of the subject and identify the challenges.
    Date: 2015–02–24
  7. By: Metin M. Cosgel (University of Connecticut); Thomas J. Miceli (University of Connecticut); Sadullah Yıldırım (University of Connecticut)
    Abstract: Civil wars of today have deep roots in political and religious history. We examine how a society’s geographic distance to religious centers and the consequent historical differences between political rulers and religious segments of the population contributed to current levels of civil war. The theory is based on a political economy model that is centered on legitimizing function that religion plays for rulers vis-à-vis citizens. We test the resulting hypotheses using a new dataset that includes annual information on the religious and political histories of today’s nations since the year 1000. The results show that civil wars in the post-1960 period have been more likely in societies that experienced higher incidents of historical differences between rulers and a significant religious group before 1960. The results hold when we control for the geographic, historical, and institutional characteristics of countries. We address endogeneity concerns between religious differences and civil wars by exploiting variation across countries in their geographic distance to religious “capitals” of the world. Instrumental variable analysis indicates that the presence of historical religious differences that could be exploited by rulers accounts for a substantial portion of civil wars between 1960 and 2014. The results reflect the deep root effects of religious differences on current conflict.
    Keywords: Civil war, conflict, religion, historical roots, political economy, grievance, geographic distance, religious difference
    JEL: D63 D74 J15 N30 O50 Z12
    Date: 2016–03

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