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on Evolutionary Economics |
| By: | Murat Iyigun; Nathan Nunn; Nancy Qian |
| Abstract: | We investigate the long-run effects of cooling on conflict. We construct a geo-referenced and digitized database of conflicts in Europe, North Africa, and the Near East from 1400-1900, which we merge with historical temperature data. We show that cooling is associated with increased conflict. When we allow the effects of cooling over a fifty-year period to depend on the extent of cooling during the preceding period, the effect of cooling on conflict is larger in locations that experienced earlier cooling. We interpret this as evidence that the adverse effects of climate change intensify with its duration. |
| JEL: | N43 N53 O13 P16 Q34 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23033&r=evo |
| By: | Oded Galor (Brown University); Ömer Özak (Southern Methodist University); Assaf Sarid (Brown University) |
| Abstract: | This research explores the economic causes and consequences of language structures. It advances the hypothesis and establishes empirically that variations in pre-industrial geographical characteristics that were conducive to higher return to agricultural investment, larger gender gap in agricultural productivity, and more hierarchical society, are at the root of existing cross-language variations in the presence of the future tense, grammatical gender, and politeness distinctions. Moreover, the research suggests that while language structures have largely reflected the coding of past human experience and in particular the range of ancestral cultural traits in society, they independently affected human behavior and economic outcomes. |
| Keywords: | Comparative Development, Cultural Evolution, Language Structure, Future Tense, Politeness Distinctions, Grammatical Gender, Human Capital, Education |
| JEL: | I25 J24 O1 O10 O11 O12 O40 O43 O44 Z10 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:smu:ecowpa:1609&r=evo |
| By: | Matthew Embrey (University of Sussex); Guillaume R. Frechette (NYU); Sevgi Yuksel (UCSB) |
| Abstract: | More than half a century after the first experiment on the finitely repeated prisoner's dilemma, evidence on whether cooperation decreases with experience - as suggested by backward induction - remains inconclusive. This paper provides a meta-analysis of prior experimental research and reports the results of a new experiment to elucidate how cooperation varies with the environment in this canonical game. We describe forces that affect initial play (formation of cooperation) and unraveling (breakdown of cooperation). First, contrary to the backward induction prediction, the parameters of the repeated game have a significant effect on initial cooperation. We identify how these parameters impact the value of cooperation - as captured by the size of the basin of attraction of Always Defect – to account for an important part of this effect. Second, despite these initial differences, the evolution of behavior is consistent with the unraveling logic of backward induction for all parameter combinations. Importantly, despite the seemingly contradictory results across studies, this paper establishes a systematic pattern of behavior: subjects converge to use threshold strategies that conditionally cooperate until a threshold round; and conditional on establishing cooperation, the first defection round moves earlier with experience. Simulation results generated from a learning model estimated at the subject level provide insights into the long-term dynamics and the forces that slow down the unraveling of cooperation. |
| Keywords: | repeated games, prisoners dilemma, threshold strategies, basin of attraction |
| JEL: | C73 C92 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:sus:susewp:08616&r=evo |
| By: | Gergely Varga (Corvinus University of Budapest); Janos Vincze (Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences and Corvinus University of Budapest) |
| Abstract: | We set up an agent-based macromodel focusing on consumption-saving without the assumption of utility maximization, but preserving certain "rational" aspects of human choice based on the idea of ecological rationality Todd et al. (2012). In this framework we address the classical problem of the efficiency of long-run capital accumulation. Three qualitatively different saving strategies are defined: 1. buffer stock saving (prudent and forward looking), 2. permanent income saving (forward looking without prudence), and 3. myopic saving (caring only about immediate consumption, and saving accidentally). In the model these types (that have subtypes depending on continuous parameters) may coexist, and we explore their respective survival chances by conducting simulations. It is found that prudent saving behavior becomes prevalent when the selection pressure is very high, but an economy comprising only prudent households tends to accumulate capital in excess of what is implied by the Golden Rule. As selecion pressure is reduced, myopic consumers appear, and under very low selection pressure the distribution of the main saver types becomes almost random. A seemingly puzzling fact emerges: the economy gets close to the Golden Rule of capital accumulation via endogenous selection of subtypes in a way that can be interpreted as "perverse exploitation", i.e. the exploitation of the rich by the poor. In other words, lowering the intensity of evolutionary forces, that results in more diversity in saver types, may be socially beneficial. Crickets may be useful for society as a whole, including prudent and cautious ants. |
| Keywords: | agent-based macromodel, bounded rationality, evolutionary learning, savings types |
| JEL: | C69 E21 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:has:discpr:1702&r=evo |
| By: | Aidin Hajikhameneh (Institute for the Study of Religion, Economics and Society, Chapman University); Erik O. Kimbrough (Simon Fraser University) |
| Abstract: | While economists recognize the important role of formal institutions in the promotion of trade, there is increasing agreement that institutions are typically endogenous to culture, making it difficult to disentangle their separate effects. Lab experiments that assign institutions exogenously and measure and control individual cultural tendencies can allow for clean identification of these effects. We focus on cultural tendencies toward individualism/collectivism, which social psychologists highlight as an important determinant of many behavioral differences across groups and people. We design an experiment to explore the relationship between subjects’ dispositions to individualism/collectivism and their willingness to engage in impersonal trade under enforcement institutions of varying strength. Overall, we find that individualists tend to engage in trade more often than collectivists. This effect is mitigated somewhat as the effectiveness of enforcement institutions increases. That is, the detrimental impact on future trade of having been cheated in the past is reduced. Nevertheless we see that cultural dispositions shape the decision to engage in impersonal trade, regardless of institutional environment. |
| Keywords: | individualism, collectivism, exchange, trust, experiments |
| JEL: | C7 C9 |
| Date: | 2017–01–23 |
| URL: | http://d.repec.org/n?u=RePEc:sfu:sfudps:dp17-01&r=evo |
| By: | Clément BELLET (London School of Economics and Political Science (LSE)); Eve SIHRA (Institut National de la Recherche Agronomique (INRA)) |
| Abstract: | Even under the direst necessity, Indian households do not seem to spend their budget in a rational of survival: households from lower castes choose to consume less food and more visible items than similar households from high castes, and this difference is stronger for the poor. Using variations in upper caste wealth across regions, we show that disadvantaged castes substitute visible consumption for food when upper castes are relatively richer. In regions where Upper Castes are twice richer, low caste households spend up to 8% more on visible and similarly less on food. For households under $2 dollars a day, it corresponds to a daily budget reallocation of 15 dollar cents. We argue that consumption choices can be partly explained by a preference for status, which depends on inequality between caste groups. Importantly, preferences are upward-looking between castes: the high caste is society’s reference group, and households outside of the caste system are not affected by it. Our results are not driven by general equilibrium effects on prices and no similar effect is observed on other expenditures. They underline the relevance of caste-targeted policies in the process of development. |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/4vljiub8888igqug7jdg3a9fck&r=evo |
| By: | Conzo, Pierluigi; Aassve, Arnstein; Fuochi, Giulia; Mencarini, Letizia (University of Turin) |
| Abstract: | The paper provides a framework for how culture affects happiness. According to self-determination theory, well-being is driven by the satisfaction of three basic psychological needs: autonomy, relatedness and competence. We assess if, and to what extent, generalized trust and the values of obedience and respect influence Europeans’ satisfaction of these needs, controlling for income and education. We find a positive and significant impact for generalized morality (high trust and respect, low obedience), which is robust to different checks for endogeneity, including instrumental variable regressions at country, regional and individual level and panel-data estimations. |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:uto:dipeco:201702&r=evo |