nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2016‒06‒14
four papers chosen by
Matthew Baker
City University of New York

  1. The Cultural Diffusion of the Fertility Transition: Evidence from Internal Migration in 19th Century France By Daudin, Guillaume; Franck, Raphaël; Rapoport, Hillel
  2. Endogenous (In)Formal Institutions. By Guerriero, Carmine; Boranbay, Serra
  3. Groups, Norms and Endogenous Membership: Towards a Socially Inclusive Economics By Raul V. Fabella
  4. Agricultural Legacy, Individualistic Culture, and Techology Adoption By James B. Ang

  1. By: Daudin, Guillaume (Université Paris-Dauphine); Franck, Raphaël (Bar-Ilan University); Rapoport, Hillel (Paris School of Economics)
    Abstract: France experienced the demographic transition before richer and more educated countries. This paper offers a novel explanation for this puzzle that emphasizes the diffusion of culture and information through internal migration. It tests how migration affected fertility by building a decennial bilateral migration matrix between French regions for 1861-1911. The identification strategy uses exogenous variation in transportation costs resulting from the construction of railways. The results suggest the convergence towards low birth rates can be explained by the diffusion of low-fertility norms by migrants, especially by migrants to and from Paris.
    Keywords: fertility, France, demographic transition, migration
    JEL: J13 N33 O15
    Date: 2016–05
  2. By: Guerriero, Carmine; Boranbay, Serra
    Abstract: Despite the huge evidence documenting the relevance of inclusive political institutions and a culture of cooperation, we still lack a framework that identifies their origins and interaction. In a model in which an elite and a citizenry try to cooperate in consumption risk-sharing and investment, we show that a rise in the investment value encourages the elite to introduce more inclusive political institutions to convince the citizenry that a sufficient part of the returns on joint investments will be shared. In addition, accumulation of culture rises with the severity of consumption risk if this is not too large and thus cheating is not too appealing. Finally, the citizenry may over-accumulate culture to credibly commit to cooperate in investment when its value falls and so inclusive political institutions are at risk. These predictions are consistent with the evolution of activity-specific geographic factors, monasticism, and political institutions in a panel of 90 European regions spanning the 1000-1600 period. Evidence from several identification strategies suggests that the relationships we uncover are causal.
    Keywords: Geography; Democracy; Culture; Development.
    JEL: H1 O1 Z1
    Date: 2012–07–11
  3. By: Raul V. Fabella (School of Economics, University of the Philippines Diliman; National Academy of Science and Technology)
    Abstract: In Part I, we argue that Economics must outgrow the narrow confines of Neo-Classical Economics to embrace ‘sociality’ first championed by Herbert Simon in the mid-1950s and now by a growing number of economists under the banner of Social Economics. We contend here that Neo-Classical Economics is incomplete, rather than wrong. Firstly any alternative model must subsume the Neo-Classical model as a special case even as it embraces conceptual promontories from other social science disciplines, viz., groups, norms and sanctions. Secondly, it must be couched in a language familiar to the economics profession? maintain optimizing behavior and equilibrium analysis. In Part II, we construct a formal model where the agent is at once a private entity and a member of a social group; his utility is inclusive combining the agent’s private utility over goods (the Neo-Classical utility) and the utility the he derives from being a member, viz., access to group’s collective good. As a member, he commits to support the procurement of the group’s collective good and submits to a system of norms and to the corresponding self-organized sanctions regime punishing violation of group norms. The agent solves a sequence of optimization problems: the first determines his optimal consumption basket given his budget constraint (net of group contribution), prices in the market location of the group; this gives his inclusive indirect utility; the second determines his optimal market hours by maximizing his indirect inclusive utility subject to time constraint and the market wage rate; this gives his doubly indirect inclusive utility; thirdly, he maximizes his inclusive doubly indirect utility with respect to the monetary contribution of the group given the sanctions for norm violation. The choice of social group follows from a rank order of groups by greatest inclusive utility an agent can attain in each competing social group. Finally, we show how the agent’s relative weighting of his private and group commitment may wax and wane depending upon the stakes of the inter-group competition.
    Keywords: Sociality, groups, norms, choice of groups, compliance with norms, inter-group competition
    JEL: D01 D11
    Date: 2016–05
  4. By: James B. Ang (Division of Economics, School of Humanities and Social Sciences, Nanyang Technological University, 14 Nanyang Drive, Singapore 637332)
    Abstract: This paper presents evidence on the relationship between culture and technology adoption. It hy-pothesizes that societies with more individualistic cultures are more inclined to embrace new tech-nologies. Using data for 82 countries, the estimates show that the technology adoption index of Comin et al. (2010) strongly correlates with national scores on individualistic cultures. Consistent evidence of this is provided by analysis conducted at the individual level using data from the World Value Surveys. Based on the notion that farming rice makes the members of a society more interdependent, and hence less individualistic, historical information on the suitability of land for rice farming is used as an instrument to isolate the endogenous influence of culture. Under the identifying restriction assumption that such an agricultural legacy explains differences in technolog-ical development in the modern world through influencing the formation of individualistic cultures, the instrumental variables estimates consistently show that the variation in the exogenous component of individualistic cultures significantly explains differences in the levels of current technology adoption across the globe. Similar findings are obtained when the analysis is conducted using state-level data from the United States. On the whole, these results lend strong support to our hypothe-sis that countries with higher scores on individualism are more inclined to adopt new technologies, thereby providing a framework for understanding the underlying causes of the variation in the lev-els of technological development across countries.
    Keywords: technology adoption, individualism, cross-country studies
    JEL: O30 O40
    Date: 2015–09

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