nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2018‒01‒22
three papers chosen by
Matthew Baker
City University of New York

  1. The transmission of continuous cultural traits in endogenous social networks By Hellmann, Tim; Panebianco, Fabrizio
  2. Divide and Rule: An Origin of Polarization and Ethnic Conflict By Yikai Wang; Simon Alder
  3. The Diffusion of New Institutions: Evidence from Renaissance Venice's Patent System By Stefano Comino; Alberto Galasso; Clara Graziano

  1. By: Hellmann, Tim (Center for Mathematical Economics, Bielefeld University); Panebianco, Fabrizio (Center for Mathematical Economics, Bielefeld University)
    Abstract: We study a model of transmission of continuous cultural traits across generations where children learn their cultural trait from their parents and their social environment modeled by a network. Parents can engage in the socialization process of their children by biasing links in the network in order for their children to adopt a cultural trait similar to their own. In this endogenous network, we study the emergence of positive and negative role models, the existence of a steady state cultural trait, its characterization in terms long-run influence of each dynasty, and the speed of convergence.
    Keywords: Cultural transmission, Social networks, Persistence of cultural traits, Network Formation
    Date: 2018–01–16
  2. By: Yikai Wang (University of Oslo); Simon Alder (University of North Carolina at Chapel H)
    Abstract: We propose a theory of ethnic conflict where political elites strategically initiate conflicts in order to polarize society and thus sustain their own power. We provide a micro-foundation for this divide-and-rule strategy by modelling polarization as a lack of trust. Trust is shaped by economic interactions between different groups as in Rohner, Thoenig, and Zilibotti (2013a). Low trust reduces the expected gains from trade. By starting a conflict and thus interrupting trade, the elite can prevent trust from emerging. The elite will follow this strategy whenever it faces a large threat of revolution which originates in the common interest of people to reap gains from trade without being taxed by the elite. This is likely to be the case if current trust levels are high and if the cost of revolution is low.
    Date: 2017
  3. By: Stefano Comino; Alberto Galasso; Clara Graziano
    Abstract: What factors affect the diffusion of new economic institutions? This paper examines this question by exploiting the introduction of the first regularized patent system, which appeared in the Venetian Republic in 1474. We begin by developing a model that links patenting activity of craft guilds with provisions in their statutes. The model predicts that guild statutes that are more effective at preventing outsiders' entry and at mitigating price competition lead to less patenting. We test this prediction on a new dataset that combines detailed information on craft guilds and patents in the Venetian Republic during the Renaissance. We find a negative association between patenting activity and guild statutory norms that strongly restrict entry and price competition. We show that guilds that originated from medieval religious confraternities were more likely to regulate entry and competition, and that the effect on patenting is robust to instrumenting guild statutes with their quasi-exogenous religious origin. We also find that patenting was more widespread among guilds geographically distant from Venice, and among guilds in cities with lower political connections, which we measure by exploiting a new database of noble families and their marriages with members of the great council. Our analysis suggests that local economic and political conditions may have a substantial impact on the diffusion of new economic institutions.
    JEL: K23 N23 O33 O34
    Date: 2017–12

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