nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2020‒06‒08
six papers chosen by
Matthew Baker
City University of New York

  1. Economic Development and the Death of the Free Market By Fix, Blair
  2. Torn between want and should: Self regulation and behavioral choices By Abhinash Borah; Raghvi Garg
  3. Positive framing does not solve the tragedy of the commons By Isaksen, Elisabeth Thuestad; Brekke, Kjell Arne; Richter, Andries
  4. In What Sense are Economic Rights Human Rights ? Departing from their Naturalistic Reading in International Human Rights Law By Samantha Besson
  5. Recursive objective and subjective multiple priors By Federica Ceron; Vassili Vergopoulos
  6. Behavioural economics for investor protection By María Eugenia Cadenas Sáez

  1. By: Fix, Blair
    Abstract: Free markets are, according to neoclassical economic theory, the most efficient way of organizing human activity. The claim is that individuals can benefit society by acting only in their self interest. In contrast, the evolutionary theory of multilevel selection proposes that groups must suppress the self interest of individuals. They often do so, the evidence suggests, by using hierarchical organization. To test these conflicting theories, I investigate how the ‘degree of hierarchy’ in societies changes with industrial development. I find that as energy use increases, governments tend to get larger and the relative number of managers tends to grow. Using a numerical model, I infer from this evidence that societies tend to become more hierarchical as energy use grows. This result is inconsistent with the neoclassical theory that individual self-interest is what benefits society. But it is consistent with the theory of multilevel selection, in which groups suppress the self-interest of their members.
    Keywords: culture,development,energy,free market,hierarchy,multilevel selection,power,sociality
    JEL: P16 P48 O43 Z1 O2
    Date: 2020
  2. By: Abhinash Borah (Ashoka University); Raghvi Garg (Ashoka University)
    Abstract: We model the behavior of a decision maker (DM) who faces an intrapersonal conflict between what she wants to do (her “want-self†) and what she thinks she should do (her “should-self†). In our model, in any choice problem, the DM first eliminates the worst alternative(s) according to the preferences of her should-self, presumably, as a way of managing the guilt that results from making choices she should not. Then, from the remaining alternatives, she chooses the best one according to the preferences of her want-self. Drawing on Freud, we interpret this choice procedure as reflective of the balancing act that preserving one’s ego requires. Indeed, this balance is key to a DM’s ability to exercise self regulation which our model analyzes in the context of behavioral choices. We characterize the model behaviorally and identify the extent to which the key behavioral parameters can be uniquely identified from choice data.
    Keywords: intrapersonal conflict, want and should selves, ego preserving heuristic, self regulation and ego depletion, behavioral choices
    Date: 2020–05
  3. By: Isaksen, Elisabeth Thuestad; Brekke, Kjell Arne; Richter, Andries
    Abstract: We investigate whether positive framing increases cooperation in three social dilemmas with slightly different properties: a linear public goods (PG) game, a non-linear PG game, and a common pool resource (CPR) game. Results from our laboratory experiments show that contributions to a linear PG are higher if the externality is framed positively, rather than negatively, corroborating earlier findings by Andreoni (1995). By contrast, we find no such framing effects in the non-linear PG game or the CPR game. In these games, the best response in the material payoffs is to contribute less if others contribute more, counteracting effects of pro-social preferences. Positive framing therefore does not help to solve the tragedy of the commons.
    JEL: C72 C92 D70
    Date: 2019–05–01
  4. By: Samantha Besson (University of Fribourg)
    Date: 2019
  5. By: Federica Ceron (UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12); Vassili Vergopoulos (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics)
    Abstract: We provide an axiomatic characterization of recursive Maxmin preferences that stem from (possibly) incomplete preferences representing choices that are justified by hard evidence. The decision-maker disposes of objective probabilistic information that may induce dynamically inconsistent behavior. To ensure that her choices be informed by objective information, dynamically consistent, and ambiguity averse, she constructs her subjective set of priors as the rectangular hull of the objective information set. The characterization builds upon two axioms that naturally combine these three requirements in a behavioral way. Moreover, our main result suggests a principled justification for the use of recursive Maxmin preferences in applications to dynamic choice problems.
    Keywords: Rectangularity,Rectangularization,Maxmin Expected Utility,Unanimity Rule,Dynamic Consistency,Prior-by-prior Updating,Objective and Subjective Rationality Keywords: Rectangularity,Unanim- ity Rule,Objective and Subjective Rationality JEL classification: D81
    Date: 2020–05
  6. By: María Eugenia Cadenas Sáez
    Date: 2020

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