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on Evolutionary Economics |
| By: | Mark Schneider (The University of Alabama); Cary Deck (The University of Alabama; Economic Science Institute, Chapman University); Patrick DeJarnette (Waseda University) |
| Abstract: | Monetary lotteries are the overwhelmingly predominant tool for understanding decisions under risk. However, many real-world decisions concern multidimensional outcomes involving dierent goods. Recent studies have tested whether people treat multidimensional risky choices in the same manner as unidimensional monetary lotteries and found that choices over consumer goods are less risk-averse and more consistent with expected utility theory than choices over monetary lotteries. While these puzzling results cannot be explained by any standard model of decision making, we demonstrate that these ndings are predicted by a salience-based model of category-dependent preferences that also explains the classic anomalies for choices under risk. Additionally, we experimentally verify a novel prediction of this Categorical Salience Theory. We further demonstrate that our model can explain empirical puzzles in nancial markets, insurance markets, and principal agent settings, including behavior in a new portfolio choice experiment that is unexplained by expected utility theory or prospect theory. |
| Keywords: | Salience; Categorization; Choice under Risk |
| JEL: | D90 D91 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:chu:wpaper:20-07&r=all |
| By: | Ichiroh Daitoh (Faculty of Business and Commerce, Keio University) |
| Abstract: | It has been found that population decline may change the properties of growth paths from those in a population-increasing economy in the Solow and semi-endogenous growth models. However, the rates of population decline needed to generate richer dynamics seem too large given the available empirical data and population prospects. This paper first shows that in a semi-endogenous growth model, positive externalities from knowledge accumulation can make such rates of population decline sufficiently small to be consistent with the United Nations population estimates. In the Solow growth model without such externalities, an introduction of child rearing costs could reduce the critical rate of population decline below which richer dynamics emerge. Finally, the economic implications of a child rearing cost are discussed for the Solow growth model with population decline. |
| Keywords: | child rearing cost, population decline, semi-endogenous growth, Solow growth model |
| JEL: | J11 O11 O47 |
| Date: | 2020–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:keo:dpaper:2020-004&r=all |
| By: | Benjamin Golub |
| Abstract: | This note presents a simple overlapping-generations (OLG) model of the transmission of a trait, such as a culture. Initially, some fraction of agents carry the trait. In each time period, young agents are ``born'' and are influenced by some older agents. Agents adopt the trait only if at least a certain number of their influencers have the trait. This influence may occur due to rational choice (e.g., because the young agents are playing a coordination game with old agents who are already committed to a strategy), or for some other reason. Our interest is in how the process of social influence unfolds over time, and whether a trait will persist or die out. We characterize the dynamics of the fraction of active agents and relate the analysis to classic results on branching processes and random graphs. |
| Date: | 2020–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2002.03569&r=all |