nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2020‒11‒02
six papers chosen by
Matthew Baker
City University of New York

  1. Beliefs, learning, and personality in the indefinitely repeated prisoner’s dilemma By Gill, David; Rosokha, Yaroslav
  2. The Evolutionary Origins of the Wealth of Nations By Quamrul H. Ashraf; Oded Galor; Marc P. B. Klemp
  3. Irrigation and Culture: Gender Roles and Women’s Rights By Fredriksson, Per G.; Gupta, Satyendra Kumar
  4. Religion in Economic History: A Survey By Sascha O. Becker; Jared Rubin; Ludger Woessmann
  5. Historical Data: Where to Find Them, How to Use Them By Giuliano, Paola; Matranga, Andrea
  6. The Rational Group By Franz Dietrich

  1. By: Gill, David (Purdue University); Rosokha, Yaroslav (Purdue University)
    Abstract: The indefinitely repeated prisoner’s dilemma (IRPD) captures the trade-off between the short-term payoff from exploiting economic partners and the long-term gain from building successful relationships. We aim to understand more about how people form and use beliefs about others in the IRPD. To do so, we elicit beliefs about the supergame strategies chosen by others. We find that initial beliefs match behavior quite well and that most subjects choose strategies that perform well given their beliefs. Motivated by belief clustering, we use beliefs to estimate a level-k model of boundedly rational thinking. We analyze how beliefs and behavior evolve with experience: beliefs become more accurate over time, and we use beliefs to provide new evidence about the mechanism that underlies learning from experience. Finally, we find that a survey measure of trust predicts cooperative behavior and optimism about others’ cooperation, which helps to explain how trust underpins successful economic exchanges.
    Keywords: Indefinitely repeated prisoner’s dilemma; infinitely repeated prisoner’s dilemma; cooperation; optimism; beliefs; belief elicitation; supergame strategies; level-k; bounded rationality; clustering; learning; best response; experimentation; strategy revision; personality; agreeableness; anxiety; cautiousness; kindness; manipulativeness; trust; factor analysis; Raven test; Quadratic Scoring Rule; game theory; experiment. JEL Classification: C72; C73; C91; D91
    Date: 2020
  2. By: Quamrul H. Ashraf; Oded Galor; Marc P. B. Klemp
    Abstract: This essay explores the deepest roots of comparative economic development. It underscores the significance of evolutionary processes since the Neolithic Revolution in shaping a society’s endowment of fundamental traits, such as predisposition towards child quality, time preference, loss aversion, and entrepreneurial spirit, that have contributed to differential paths of technological progress, human-capital formation, and economic development across societies. Moreover, it highlights the indelible mark of the exodus of Homo sapiens from Africa tens of thousands of years ago on the degree of interpersonal population diversity across the globe and examines the impact of this variation in diversity for comparative economic, cultural, and institutional development across countries, regions, and ethnic groups.
    Keywords: comparative development, human evolution, natural selection, preference for child quality, time preference, loss aversion, entrepreneurial spirit, the “out of Africa” hypothesis, interpersonal diversity
    JEL: O11 N10 N30 Z10
    Date: 2020
  3. By: Fredriksson, Per G.; Gupta, Satyendra Kumar
    Abstract: This paper proposes that ancestral use of irrigation reduces contemporary female labor force participation and female property rights. We test this hypothesis using an exogenous measure of irrigation and data from the Afrobarometer, cross-country data, the European Social Survey, the American Community Survey, and the India Demographic and Household Survey. Our hypothesis receives considerable empirical support. We find negative associations between ancestral irrigation and actual female labor force participation, and attitudes to such participation, in contemporary African and Indian populations, 2nd generation European immigrants, 1.5 and 2nd generation US immigrants, and in cross-country data. Moreover, ancestral irrigation is negatively associated with attitudes to female property rights in Africa and with measures of such rights across countries. Our estimates are robust to a host of control variables and alternative specifications. We propose multiple potential partial mechanisms. First, in pre-modern societies the men captured technologies complementary to irrigation, raising their relative productivity. Fertility increased. This caused lower female participation in agriculture and subsistence activities, and the women worked closer to home. Next, due to the common pool nature of irrigation water, historically irrigation has involved more frequent warfare. This raised the social status of men and restricted women's movement. These two mechanisms have produced cultural preferences against female participation in the formal labor market. Finally, irrigation produced both autocracy and a culture of collectivism. These are both associated with weaker female property rights.
    Keywords: Irrigation,agriculture,culture,gender,norms,labor force participation,property rights
    JEL: J16 J21 N50 O10 P14 Q15 Z13
    Date: 2020
  4. By: Sascha O. Becker (University, University of Warwick; CAGE; CEPR, CESifo, IZA, and ROA); Jared Rubin (Rubin: Chapman University); Ludger Woessmann (University of Munich and ifo Institute; CESifo, IZA, and CAGE)
    Abstract: This chapter surveys the recent social science literature on religion in economic history, covering both socioeconomic causes and consequences of religion. Following the rapidly growing literature, it focuses on the three main monotheisms—Judaism, Christianity, and Islam—and on the period up to WWII. Works on Judaism address Jewish occupational specialization, human capital, emancipation, and the causes and consequences of Jewish persecution. One set of papers on Christianity studies the role of the Catholic Church in European economic history since the medieval period. Taking advantage of newly digitized data and advanced econometric techniques, the voluminous literature on the Protestant Reformation studies its socioeconomic causes as well as its consequences for human capital, secularization, political change, technology diffusion, and social outcomes. Works on missionaries show that early access to Christian missions still has political, educational, and economic consequences in present-day Africa, Asia, and Latin America. Much of the economics of Islam focuses on the role that Islam and Islamic institutions played in political-economy outcomes and in the “long divergence” between the Middle East and Western Europe. Finally, cross-country analyses seek to understand the broader determinants of religious practice and its various effects across the world. We highlight three general insights that emerge from this literature. First, the monotheistic character of the Abrahamic religions facilitated a close historical interconnection of religion with political power and conflict. Second, human capital often played a leading role in the interconnection between religion and economic history. Third, many socioeconomic factors matter in the historical development of religions.
    Keywords: JEL Classification:
    Date: 2020
  5. By: Giuliano, Paola (University of California, Los Angeles); Matranga, Andrea (Chapman University)
    Abstract: The use of historical data has become a standard tool in economics, serving three main purposes: to examine the influence of the past on current economic outcomes; to use unique natural experiments to test modern economic theories; and to use modern economic theories to refine our understanding of important historical events. In this chapter, we provide a comprehensive analysis of the types of historical data most commonly used in economic research and discuss a variety of issues that they raise, such as the constant change in national and administrative borders; the reshuffling of ethnic groups due to migration, colonialism, natural disasters, and many other forces. We also point out which methodological advances allow economists to overcome or minimize these problems.
    Keywords: historical data, geographical data, ethnographic data, censuses
    JEL: N0
    Date: 2020–10
  6. By: Franz Dietrich (Centre d'Economie de la Sorbonne, Paris School of Economics)
    Abstract: Can a group be a standard rational agent? This would require the group to hold aggregate preferences which maximise expected utility and change only by Bayesian updating. Group rationality is possible, but the only preference aggregation rules which support it (and are minimally Paretian and continuous) are the linear-geometric rules, which combine individual tastes linearly and individual beliefs geometrically
    Keywords: Bayesian aggregation; preference aggregation under uncertainty; expected-utility hypothesis for groups; Bayesian revision; rational group agents; linear versus geneometric opinion pooling
    JEL: D71 D81
    Date: 2020–06

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