nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2017‒02‒05
seven papers chosen by
Matthew Baker
City University of New York

  1. A Cliometric Model of Unified Growth. Family Organization and Economic Growth in the Long Run of History By Claude Diebolt; Faustine Perrin
  2. Behavioral Economics and the Atheoretical Style By Spiegler, Ran
  3. Incentivising the Social Discounting Task: A laboratory experiment By Frederik Booysen; Tshele Moloi; Alistair Munro; Sevias Guvurino; Celeste Campher
  4. On the origin and consequences of racism By Bonick, Matthew; Farfán-Vallespín, Antonio
  5. Islamic Law and Investments in Children: Evidence from the Sharia Introduction in Nigeria By Marco Alfano
  6. Why Is the Practice of Levirate Marriage Disappearing in Africa? HIV/AIDS as an Agent of Institutional Change By Kudo, Yuya
  7. From self-fulfilling mistakes to behavioral learning equilibria By Cars Hommes

  1. By: Claude Diebolt; Faustine Perrin
    Abstract: This chapter explores the role of gender equality over the long-run economic and demographic development path of industrialized countries. It accounts for changes in fertility, technology, and income per capita in the transition from stagnation to sustained growth. Our unified cliometric growth model of female empowerment suggests that changes in gender relations, triggered by endogenous skill-biased technological progress, induce women to invest in skilled education and engage a process of human capital accumulation. In parallel, a higher time spent by women in education increases the opportunity cost of having children and reduces fertility. This positive feedback loop generates both a demographic and an economic transition.
    Keywords: Cliometrics, Economic Growth, Gender, Fertility, Human Capital.
    JEL: J1 N3 O4
    Date: 2017
  2. By: Spiegler, Ran
    Abstract: Behavioral economics is perceived by many to be part of a general shift in the culture of economics toward a less theoretical style. I present a critical discussion of certain manifestations of this trend: a preference for an anecdotal style of exposition (illustrated by Akerlof and Shiller's Phishing for Phools), reduced-form modeling (illustrated by Campbell's Ely Lecture), and the method of capturing psychological forces using parametric modifications of conventional functional forms. I argue that the subject of "psychology and economics" is intrinsically foundational, and that a pure-theory component is essential for it to realize its transformative potential.
    JEL: D03
    Date: 2017–01
  3. By: Frederik Booysen (University of the Free State, Bloemfontein, South Africa); Tshele Moloi (University of the Free State, Bloemfontein, South Africa); Alistair Munro (National Graduate Institute for Policy Studies); Sevias Guvurino (University of the Free State, Bloemfontein, South Africa); Celeste Campher (University of the Free State, Bloemfontein, South Africa)
    Abstract: Altruism is one of the single most important social preferences driving human behaviour. In Psychology experiments, the Social Discounting Task is employed as a measure of altruism. A conventional laboratory experiment was conducted with 117 undergraduate students, with students randomly assigned to complete an incentivized and un-incentivized Social Discounting Task. In accordance with the 1/d law of giving, the results exhibit the expected inverse relationship between social distance and altruism. There is weak evidence that incentivizing the Social Discounting Task impacts the measurement of altruism in a student population. More specifically, subjects are more altruistic when incentivized, possibly due to enforced reciprocity. At the same time, making payments real influence the identity of the target recipients: paying makes subjects more likely to choose people who are physically and psychologically close at high ranks, and more likely to report greater physical and psychological distance to subjects at lower ranks. Further research is required to verify the robustness of this result. The study also shows that among students family members are more altruistic toward each other as are those exhibiting greater intergenerational solidarity. Preferences for altruism in this student population is no different from WEIRD subject populations.
    Date: 2017–01
  4. By: Bonick, Matthew; Farfán-Vallespín, Antonio
    Abstract: Using a novel method to measure racism at the individual and country level, we show, our measure of racism has a strong negative and significant impact on economic development, quality of institutions, education and social capital. We test different hypotheses concerning the origin of racism and its channels of impact to establish causality. We find racism is not correlated with measures for the coexistence of different racial or ethnic groups or ethnically- motivated conflicts. Importantly, we show, for former colonies, racism is strongly correlated with the presence of extractive institutions during colonial times, even after controlling for current institutions, GDP per capita and education. We argue, extractive colonial institutions not only had a negative impact on the political and economic institutions but also shaped the cultural values of the population. We claim colonial powers instilled racism among the population of their colonies in order to weaken their ability for collective action.
    Date: 2016
  5. By: Marco Alfano (Department of Economics, University of Strathclyde)
    Abstract: Islamic law lays down detailed rules regulating the upbringing of children. This study examines the effect of such rules on parental behaviour by analysing the introduction of Sharia law in northern Nigeria. The empirical strategy exploits variation across administrative areas, time and religion together with the fact that the historical homelands of some Nigerian ethnicities fall into both states that introduced Islamic laws and states that did not. Estimates show that the introduction of Sharia law increased fertility, the duration of breastfeeding and primary school enrolment. Evidence further suggests that the Sharia affected behaviour by increasing the economic returns to sons and by raising the value of conspicuous adherence to Islam.
    Keywords: Islam, Fertility, Breastfeeding, Nigeria
    JEL: O15 J12 J13
    Date: 2017–01
  6. By: Kudo, Yuya
    Abstract: Levirate marriage, whereby a widow is inherited by male relatives of her deceased husband, has anecdotally been viewed as informal insurance for widows who have limited property rights. This study investigates why this widespread practice in sub-Saharan Africa has recently been disappearing. A developed game-theoretic analysis reveals that levirate marriage arises as a pure strategy subgame perfect equilibrium when a husband's clan desires to keep children of the deceased within its extended family and widows have limited independent livelihood means. Female empowerment renders levirate marriage redundant because it increases widows' reservation utility. HIV/AIDS also discourages a husband's clan from inheriting a widow who loses her husband to HIV/AIDS, reducing her remarriage prospects and thus, reservation utility because she is likely to be HIV positive. Consequently, widows' welfare tends to decline (increase) in step with the deterioration of levirate marriage driven by HIV/AIDS (female empowerment). By exploiting long-term household panel data drawn from rural Tanzania and testing multiple theoretical predictions relevant to widows' welfare and women's fertility, this study finds that HIV/AIDS is primarily responsible for the deterioration of levirate marriage. Young widows in Africa may need some form of social protection against the influence of HIV/AIDS.
    Keywords: Women welfare, Social customs, Marriage, Diseases, Tanzania, Female empowerment, HIV/AIDS, Informal insurance, levirate marriage, Social institution, Widowhood protection
    JEL: J12 J13 J16 Z13
    Date: 2017–01
  7. By: Cars Hommes (CeNDEF, University of Amsterdam and Tinbergen Institute, The Netherlands)
    Abstract: This essay links some of my own work on expectations, learning and bounded rationality to the inspiring ideas of Jean-Michel Grandmont. In particular, my work on consistent expectations and behavioral learning equilibria may be seen as formalizations of JMG's ideas of self-fulfilling mistakes. Some of our learning-to-forecast laboratory experiments with human subjects have also been strongly influenced by JMG's ideas. Key features of self-fulfilling mistakes are multiple equilibria, excess volatility and persistence amplification.
    Keywords: expectations; learning; bounded rationality; chaos; almost self-fulfilling equilibria; laboratory experiments
    JEL: D84 D83 E32 C92
    Date: 2017–01–30

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