nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2018‒07‒30
five papers chosen by
Matthew Baker
City University of New York

  1. 'Discrete beliefs space and equilibrium: a cautionary note' By Michele Berardi
  2. Cultural values and behavior in dictator, ultimatum and trust games: an experimental study By Sun-Ki Chai; Dolgorsuren Dorj; Katerina Sherstyuk
  3. The Impact of the Reformation on the Economic Development of Western Europe By Sheremeta, Roman; Smith, Vernon
  4. The Evolution of Self-Control in the Brain By David Jiménez-Gómez
  5. The Challenges of Diversity in America: From the Black Perspective By Tunde Adeleke

  1. By: Michele Berardi
    Abstract: Bounded rationality requires assumptions about ways in which rationality is constrained and agents form their expectations. Evolutionary schemes have been used to model beliefs dynamics, with agents choosing endogenously among a limited number of beliefs heuristics according to their relative performance. This work shows that arbitrarily constraining the beliefs space to a ?nite (small) set of possibilities can generate arti?cial equilibria that can be stable under evolutionary dynamics. Only when "enough" heuristics are available, beliefs in equilibrium are not arti?cially constrained. I discuss these ?ndings in light of an alternative approach to modelling beliefs dynamics, namely adaptive learning.
    Date: 2018
  2. By: Sun-Ki Chai (Department of Sociology, University of Hawaii at Manoa); Dolgorsuren Dorj (Department of Economics, National Academy of Governance); Katerina Sherstyuk (Department of Economics, University of Hawaii at Manoa)
    Abstract: Culture is a central concept broadly studied in social anthropology and sociology. It has been gaining increasing attention in economics in relation to research on discrimination in a labor market, identity, gender, and social preferences. Most experimental economics research on culture studies cross-national or cross-ethnic differences in economic behavior. These studies reveal clear behavioral differences across different ethnic groups, yet do not provide a general deductive framework for specifying the underlying preferences behind these differences. We explain laboratory behavior in the dictator, ultimatum, and trust games based on two cultural dimensions adopted from a prominent general cultural framework in contemporary social anthropology: group commitment and grid control. Group-ness measures the extent to which individual identity is incorporated into group or collective identity; grid-ness measures the extent to which social and political prescriptions intrinsically influence individual behavior. One objective of this paper is to show that the grid-group framework, despite its origins in comparative ethnography, is adaptable to an experimental setting and indeed provides a parsimonious framework for generating testable behavioral predictions across a variety of experimental games. Another is to test the predictions of the grid- group framework on a number of simple games widely employed by experimental economists. Grid-group characteristics are measured for each individual using selected items from the World Values Survey. We find that these attributes allow us to systematically predict behavior in a way that discriminates among multiple forms of social preferences using a simple, parsimonious deductive model. Based on the implications of the theory, we hypothesize that subjects with higher group scores will tend to offer more in dictator and ultimatum games and entrust more in trust games. When responding in ultimatum games, those with high grid scores are hypothesized to reject more often and divide less, and to tie acceptance and amount divided more closely to the amount offered. When responding in trust games, those with low group scores are hypothesized to return less, and those with high grid scores to tie the amount returned more closely to the amount entrusted. These theoretical predictions are confirmed overall for most experimental games, although the strength of empirical support varies across games. We conclude that grid-group cultural theory is a viable predictor of people’s economic behavior, and further discuss potential limitations of the current approach and the ways to improve it.
    Keywords: laboratory experiment, two-person games, survey, culture
    JEL: C72 C91 Z13
    Date: 2018–05
  3. By: Sheremeta, Roman; Smith, Vernon
    Abstract: The Protestant Reformation is a vivid example of how religious transformation could set in motion institutional changes, leading to profound consequences for economic and political development. Although economists and other social scientists agree that there is a strong relation between the Reformation and economic growth, there is an active discussion as to what are the causal pathways connecting Protestantism to long-run economic success. We discuss the causal pathways that received substantial empirical support in academic literature. Some of them, such as “work ethic” and entrepreneurial spirit of Protestants, were originally suggested by Max Weber, while others, such as religious freedom and education, are deeply grounded in economic theory. More recently, other causal pathways have been suggested, such as social ethic, civil society, and institutional changes. We bring our view of these pathways.
    Keywords: Reformation, religion, economic development
    JEL: A13 B15 E02 Z12
    Date: 2017–05–07
  4. By: David Jiménez-Gómez (Dpto. Fundamentos del Análisis Económico)
    Abstract: Temptation and self-control evolved as single mechanism to make humans behave against their own self-interest. I analyze the evolution of self-control in a principal-agent framework, in which the agent has access to private information but his utility cannot depend on all rel-evant variables. The principal can obtain the first best asymptotically by biasing the utility of the agent (from which an endogenous conflict emerges) and simultaneously endowing the agent with a limited amount of self-control.Several empirical properties of self-control, observed in psychological experiments, are explained in terms of the model: 1) self-control grows over time as it is exercised; 2) self-control is lower when the level of glucose in the blood is low, but does not depend on a physical resource; 3) as the environment becomes more tempting, individuals exhibit less self-control. The model sheds light on the di¿erence between self-control and hyperbolic discounting and provides a framework for understanding the recent surge of chronic non-communicable diseases, suggesting that the current environment could be welfare-reducing.
    Keywords: neuroeconomics, evolution of preferences, self-control
    JEL: D60 D90 C72 D81
    Date: 2018–07
  5. By: Tunde Adeleke (Iowa State University, African American Studies Program)
    Abstract: Diversity remains a contested and controversial subject. The depiction of America as a nation of diverse peoples remains visionary and aspirational. Molding America into one nation out of multiple and complex entities seems insurmountable. Black Americans have vigorously contested the representation of America as diverse and multicultural. A truly diverse and multicultural nation, critics contend, has to eradicate all trappings of ethno-cultural hegemony. Even as she strives for ?a more perfect union? America seems incapable of transcending the historical legacies of slavery and racism. From the ?melting pot? to the ?salad bowl? and more recent characterizations, America seems incapable of becoming an embodiment of her diverse peoples. An increasingly alienated black American population conceptualizes America within the discourse of alienation as a nation of permanently fractured racial and cultural identities. These blacks seek an alternative and countervailing African-derived protest identity?Afrocentrism. Thus they reject E Pluribus Unum (Out of many, one). Though America may seem multicultural, the ideal of one nation unifying and representing multiple cultures remains a distant and elusive aspiration. Skeptical of diversity, and distrustful of Multiculturalism, Afrocentrists offer an alternative African-centered philosophy of inclusiveness which, not surprisingly, critics denounce as inherently hegemonic and a negation of America?s celebration of plurality. This paper discusses the historical, social and cultural underpinnings of contemporary discourses and counter narratives about the prospects of diversity in America. It examines the challenges that Afrocentrism represents for defining what being ?American? truly means. There are two critical questions at the core of this paper: First, would multiple hyphenated American identities become the norm? Second, what are the implications of essentialist constructions of the black experience and identity for diversity and multiculturalism in America?
    Keywords: Diversity, Multiculturalism, Afrocentrism, African-Centered, Ethno-Cultural
    Date: 2017–07

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