nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2020‒02‒03
five papers chosen by
Matthew Baker
City University of New York

  1. Relative consumption, relative wealth, and long-run growth: When and why is the standard analysis prone to erroneous conclusions? By Hof, Franz X.; Prettner, Klaus
  2. Perplexing Complexity Human Modelling and Primacy of the Group as Essence of Complexity By Hanappi, Hardy
  3. “Fatal Attraction” and Level-k thinking in games with Non-neutral frames By Crawford, Vincent P
  4. Are the World's Languages Consolidating? The Dynamics and Distribution of Language Populations By Clingingsmith, David
  5. The End of Economic Growth? Unintended Consequences of a Declining Population By Charles I. Jones

  1. By: Hof, Franz X.; Prettner, Klaus
    Abstract: We employ a novel approach for analyzing the effects of relative consumption and relative wealth preferences on both the decentralized and the socially optimal economic growth rates. In the pertinent literature these effects are usually assessed by examining the dependence of the growth rates on the two parameters of the instantaneous utility function that seem to measure the strength of the relative consumption and the relative wealth motive. We go beyond the sole consideration of parameters by revealing the fundamental factors that ultimately determine long-run growth. In doing so we identify widely used types of status preferences in which the traditional approach is prone to erroneous conclusions. For example, in one of these specifications the parameter that seems to determine the strength of the relative consumption motive actually also affects the strength of the relative wealth motive and the elasticity of intertemporal substitution.
    Keywords: relative consumption,relative wealth,quest for status,long-run economic growth,social optimality,deep factors
    JEL: D31 D62 O10 O30
    Date: 2019
  2. By: Hanappi, Hardy
    Abstract: This paper describes the emergence of complexity as duplicated evolutionary process. The first procedural source of complexity is the quantum jump of the evolution of the human species when it started to maintain certain brain-internal models of its environment. The second - parallel - procedural origin is the evolution of a communication structure, a language, with which an already existing group of primates could frame their internal models. In contrast to definitions of complexity which use the concept in the context of theoretical physics, this approach reveals some perplexing properties of model-building for a special subject of investigation; namely the human species: All adequate models of political economy (economics is just the sub-discipline that freezes political dynamics) have to be complex. Since today’s mainstream economic theory lends its formal apparatus from the mathematics of Newtonian physics, it misses the most essential features characterizing human social dynamics, i.e. its complexity.
    Keywords: Evolutionary Complexity, Quantum Political Economy
    JEL: B40 B5 B50 P16
    Date: 2020–01–13
  3. By: Crawford, Vincent P
    Keywords: Behavioral game theory, Experimental game theory, Strategic thinking, Level-k models, Coordination, Salience, Applied Economics, Economics
    Date: 2018–12–01
  4. By: Clingingsmith, David (Case Western Reserve University)
    Abstract: Scholars have conjectured that the return to speaking a language increases with the number of speakers. Long-run economic and political integration would accentuate this advantage, increasing the population share of the largest languages. I show that, to the contrary, language size and growth are uncorrelated except for very small languages (<35,000 speakers). I develop a model of local language coordination over a network. The steady-state distribution of language sizes follows a power law and precisely fits the empirical size distribution of languages with ≥35,000 speakers. Simulations suggest the extinction of 40% of languages with <35,000 speakers within 100 years.
    Date: 2017–12–13
  5. By: Charles I. Jones
    Abstract: In many models, economic growth is driven by people discovering new ideas. These models typically assume either a constant or a growing population. However, in high income countries today, fertility is already below its replacement rate: women are having fewer than two children on average. It is a distinct possibility — highlighted in the recent book, “Empty Planet” — that global population will decline rather than stabilize in the long run. What happens to economic growth when population growth turns negative?
    JEL: E0 J11 O4
    Date: 2020–01

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