nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2019‒01‒14
eight papers chosen by
Matthew Baker
City University of New York

  1. Relationship between biodiversity and agricultural production By Ilaria Brunetti; Mabel Tidball; Denis Couvet
  2. Subject Pools and Deception in Agricultural and Resource Economic Experiments By Timothy N. Cason; Steven Y. Wu
  3. Intertemporal Choice By Keith Marzilli Ericson; David Laibson
  4. Japan and the Great Divergence, 730-1874 By Bassino, Jean-Pascal; Broadberry, Stephen; Fukao, Kyoji; Gupta, Bishnupriya; Takashima, Masanori
  5. Rational Self-Medication By Michael E. Darden; Nicholas W. Papageorge
  6. Wars, Local Political Institutions, and Fiscal Capacity: Evidence from Six Centuries of German History By Becker, Sascha O.; Ferrara, Andreas; Melander, Eric; Pascali, Luigi
  7. Policy Evaluation in Behavioral Models By Christian Michel; André Stenzel
  8. Energy, hierarchy and the origin of inequality By Fix, Blair

  1. By: Ilaria Brunetti (CMAP - Centre de Mathématiques Appliquées - Ecole Polytechnique - X - École polytechnique - CNRS - Centre National de la Recherche Scientifique); Mabel Tidball (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - INRA - Institut National de la Recherche Agronomique - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier); Denis Couvet (MNHN - Muséum National d'Histoire Naturelle)
    Abstract: Agriculture is one of the main causes of biodiversity loss. In this work we model the interdependent relationship between biodiversity and agriculture on a farmed land, supposing that, while agriculture has a negative impact on biodiversity, the latter can increase agricultural production. Farmers act as myopic agents, who maximize their instantaneous profit without considering the negative effects of their practice on the evolution of biodiversity. We find that a tax on inputs can have a positive effect on yield since it can be considered as a social signal helping farmers to avoid myopic behavior in regards to the positive effect of biodiversity on yield. We also prove that, by increasing biodiversity productivity the level of biodiversity at equilibrium decreases, since when biodiversity is more productive farmers can maintain lower biodiversity to get the same yield.
    Keywords: cleansing dictator game licensing moral in(consistency taking game.
    Date: 2018
  2. By: Timothy N. Cason; Steven Y. Wu
    Abstract: The use of student subjects and deception in experiments are two controversial issues that often raise concerns among editors and reviewers, which might prevent quality research from being published in agricultural and resource economics (ARE) journals. We provide a self-contained methodological discussion of these issues. We argue that field professionals are the most appropriate subjects for questions related to policy or measurement, and students are the most appropriate subjects for scientific research questions closely tied to economic theory. Active deception, where subjects are provided with explicitly misleading information, has been avoided in the mainstream economics discipline because it can lead to a loss of experimental control, lead to subject selection bias, and impose negative externalities on other researchers. Disciplinary ARE journals may want to abide by these norms against deception to maintain credibility. Interdisciplinary ARE journals may have more flexibility, although it is important to provide guidelines to avoid too much reviewer-specific variation in standards. For ARE researchers, we suggest employing a deception-free experimental design whenever possible because we know of no field in which deception is encouraged.
    JEL: C9 Q10 Q30 Q50
    Date: 2018–12
  3. By: Keith Marzilli Ericson; David Laibson
    Abstract: Intertemporal tradeoffs play a key role in many personal decisions and policy questions. We describe models of intertemporal choice, identify empirical regularities in choice, and pose new questions for research. The focus for intertemporal choice research is no longer whether the exponential discounted utility model is empirically accurate, but, instead, what models best explain the robust behavioral deviations we observe. We introduce the term “present-focused preferences” to describe the large class of models that prioritize present flows of experienced utility. Present-focused preferences need not coincide with a preference for commitment or dynamically inconsistent preferences. Present-bias is a special case of present-focused preferences.
    JEL: C90 D14 D60 D91
    Date: 2018–12
  4. By: Bassino, Jean-Pascal; Broadberry, Stephen; Fukao, Kyoji; Gupta, Bishnupriya; Takashima, Masanori
    Abstract: Despite being the first Asian economy to achieve modern economic growth, Japan has received relatively little attention in the Great Divergence debate. New estimates suggest that although the level of GDP per capita remained below the level of northwest Europe throughout the period 730-1874, Japan experienced positive trend growth before 1868, in contrast to the negative trend growth experienced in China and India, leading to a Little Divergence within Asia. However, growth in Japan remained slower than in northwest Europe so that Japan continued to fall behind until after the institutional reforms of the early Meiji period. The Great Divergence thus occurred as the most dynamic part of Asia fell behind the most dynamic part of Europe.
    Keywords: GDP per capita, Britain, Great Divergence, Japan
    JEL: N10 N30 N35 O10 O57
    Date: 2018–12
  5. By: Michael E. Darden; Nicholas W. Papageorge
    Abstract: We develop a theory of rational self-medication. The idea is that forward-looking individuals, lacking access to better treatment options, attempt to manage the symptoms of mental and physical pain outside of formal medical care. They use substances that relieve symptoms in the short run but that may be harmful in the long run. For example, heavy drinking could alleviate current symptoms of depression but could also exacerbate future depression or lead to alcoholism. Rational self-medication suggests that, when presented with a safer, more effective treatment, individuals will substitute towards it. To investigate, we use forty years of longitudinal data from the Framingham Heart Study and leverage the exogenous introduction of selective serotonin reuptake inhibitors (SSRIs). We demonstrate an economically meaningful reduction in heavy alcohol consumption for men when SSRIs became available. Additionally, we show that addiction to alcohol inhibits substitution. Our results suggest a role for rational self-medication in understanding the origin of substance abuse. Furthermore, our work suggests that punitive policies targeting substance abuse may backfire, leading to substitution towards even more harmful substances to self-medicate. In contrast, policies promoting medical innovation that provide safer treatment options could obviate the need to self-medicate with dangerous or addictive substances.
    JEL: I10 I12
    Date: 2018–12
  6. By: Becker, Sascha O. (University of Warwick and CAGE); Ferrara, Andreas (University of Warwick and CAGE); Melander, Eric (University of Warwick and CAGE); Pascali, Luigi (UPF and CAGE)
    Abstract: We study the effect of warfare on the development of state capacity and representative institutions using novel data on cities and territories in the German lands between 1200 and 1750. More specifically, we show that cities with a higher conflict exposure establish more sophisticated tax systems, but also develop larger councils, councils that are more likely to be elected by citizens, and more likely to be independent of other local institutions. These results are consistent with the idea of a trade-off between more efficient taxation and power sharing proposed in earlier work. We make headway on establishing a causal role of wars by using changes to German nobles’ positions within the European nobility network to instrument for conflict.
    Keywords: N13; P48; R11 Jel Classification: WARFARE; POLITICAL INSTITUTIONS; STATE CAPACITY
    Date: 2018
  7. By: Christian Michel; André Stenzel
    Abstract: This paper studies the data requirements to conduct an unambiguous policy evaluation when consumers may exhibit nonstandard preferences. We theoretically analyze how the equilibrium combinations before and after a policy introduction allow to clearly assess different economic indicators. Specifically, we study the data requirements for an unambiguous evaluation of two distinct consumer "cooling off" policies in a model in which consumers may exhibit a projection bias when making consumption decisions. We find that market-level data can help to make simple policy evaluations using baseline statistics and sometimes even discriminate between different classes of consumer preferences. We further discuss the generalizability to other models and the use for ex-ante policy design.
    Keywords: Ex-post policy evaluation, Identification of nonstandard preferences, Projection bias, Cooling off, Behavioral economics
    JEL: D04 D18 D90
    Date: 2018–12
  8. By: Fix, Blair
    Abstract: Where should we look to understand the origin of inequality? Most research focuses on three windows of evidence: (1) the archaeological record; (2) existing traditional societies; and (3) the historical record. I propose a fourth window of evidence - modern society itself. I hypothesize that we can infer the origin of inequality from the modern relation between energy use, hierarchy, and inequality. To do this, I create a large-scale numerical model that is informed by modern evidence. I then use this model to project modern trends into the past. The results are promising. The model predicts an explosion of inequality with the transition to agrarian levels of energy use. Subsequent increases in energy use are predicted to have little effect on inequality. The results are broadly consistent with the available evidence. This suggests that the hierarchical structure of modern societies may provide a window into the origin of inequality.
    Keywords: origin of inequality,hierarchy,energy,institution size,numerical model,function,coercion
    Date: 2018

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