nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2023‒02‒06
seven papers chosen by
Matthew Baker
City University of New York

  1. The country that they built: The dynamic and complex indigenous economies in North America before 1492 By Carlos, Ann M.
  2. Class Di¤erences and the Commercial Revolution: An Equilibrium Selection Story By Maurizio Iacopetta
  3. Selective Memory of a Psychological Agent By Jeanne Hagenbach; Frédéric Koessler
  4. Bayesian Contextual Choices under Imperfect Perception of Attributes By Junnan He
  5. Norms and the Evolution of Leaders Followership By Antonio Cabrales; Esther Hauk
  6. Equilibrium Determinacy With Behavioral Expectations By Jonathan J Adams
  7. Cultural Additivity Theory By Vuong, Quan-Hoang; Nguyen, Minh-Hoang; Jin, Ruining; Le, Tam-Tri

  1. By: Carlos, Ann M.
    Abstract: The economic history of the United States is that of Europeans and their institutions. Indigenous nations are absent. This absence is due partly to lack of data but in large measure to a perception that Indigenous communities have contributed little to US growth. This paper argues that this erasure of Indigenous activity overestimates the contributions of European colonists and immigrants. Three case studies explore the economic complexity and social stratification across different nations/regions. Migrants to the Unites States did not come to an empty land but one with settled agriculture, complex production processes and extensive trade relations.
    Keywords: Indigenous economic history, North America
    JEL: J15 N31 N51 N91
    Date: 2022
  2. By: Maurizio Iacopetta (SKEMA Business School - SKEMA Business School, GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (1965 - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015-2019) - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur, OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po)
    Abstract: The reopening of the Mediterranean routes in the tenth century sparked, in some regions of Europe, a long period of economic boom. It also triggered a social change whereby some members of the nobility, despite their social status, turned to commerce. I explain these events through the lens a Kiyotaki and Wright (1989) model, extended to a two-country world. The response of the elite to a communication shock causes the economy to transit from a low-to a high-production equilibrium, if pre-existing class di¤erences are not too large. Quantitative experiments illustrate the view of economic historians that medieval expansion ensued in regions where the elite enjoyed relatively modest privileges and was slow in places, most notably France, where the elite's preoccupation for preserving the social-status was strong.
    Keywords: Equilibrium Selection, Trade, Search
    Date: 2021
  3. By: Jeanne Hagenbach (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Frédéric Koessler (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)
    Abstract: We consider a single psychological agent whose utility depends on his action, the state of the world, and the belief he holds about that state. The agent is initially informed about the state and decides whether to memorize it, otherwise he has no recall. We model the memorization process by a multi-self game in which the privately-informed first self voluntarily discloses information to the second self, who has identical preferences and acts upon the disclosed information. We show that, for broad categories of psychological utility functions, there exists an equilibrium in which every state is voluntarily memorized. In contrast, if there are exogenous failures in the memorization process, the agent always memorizes states selectively. In this case, we characterize the partially informative equilibria for common classes of psychological utilities.
    Keywords: Multi-self games, Disclosure games, Imperfect recall, Selective memory, Motivated beliefs, Psychological games, Anticipatory utility
    Date: 2022–02
  4. By: Junnan He (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The classical rational choice theory proposes that preferences are context-independent, e.g. independent of irrelevant alternatives. Empirical choice data, however, display several contextual choice effects that seem inconsistent with rational preferences. We study a choice model with a fixed underlying utility function and explain contextual choices with a novel information friction: the agent's perception of the options is affected by an attribute-specific noise. Under this friction, the agent learns useful information when she sees more options. Therefore, the agent chooses contextually, exhibiting intransitivity, joint-separate evaluation reversal, attraction effect, compromise effect, similarity effect, and phantom decoy effect. Nonetheless, because the noise is attribute-specific and common across alternatives, the agent's choice is perfectly rational whenever an option clearly dominates others.
    Keywords: Compromise effect, Context effect, Imperfect perception, Intransitive choices, Joint-separate evaluation reversal, Phantom decoy effect, Stable preferences.
    Date: 2021
  5. By: Antonio Cabrales; Esther Hauk
    Abstract: In this paper we model the interaction between leaders, their followers and crowd followers in a coordination game with local interaction. The steady states of a dynamic best-response process can feature a coexistence of Pareto dominant and risk dominant actions in the population. The existence of leaders and their followers, plus the local interaction, which leads to clustering, is crucial for the survival of the Pareto dominant actions. The evolution of leader and crowd followership shows that leader followership can also be locally stable around Pareto dominant leaders. The paper answers the questions (i) which Leader should be removed and (ii) how to optimally place leaders in the network to enhance payoff dominant play.
    Date: 2023–01
  6. By: Jonathan J Adams (Department of Economics, University of Florida)
    Abstract: When do dynamic models with behavioral expectations have unique solutions? I derive a Blanchard-Kahn-style condition that ensures a unique solution exists in a broad class of models: the number of non-predetermined variables must match the number of the model's unstable eigenvalues. With behavioral expectations, an eigenvalue is unstable if it is larger in magnitude than the spectral radius of the expectation operator. The condition is always sufficient, but only necessary for some forms of expectations: many behavioral expectations do not admit sunspot equilibria in some types of models. Next, I illustrate the determinacy conditions in several examples, including the canonical New Keynesian model, which has a unique equilibrium under an interest rate peg when expectations are given by a variety of common heuristics. Finally, I characterize the spectral radii and other properties of a variety of popular behavioral expectations.
    JEL: C62 D84 E70
    Date: 2023–01
  7. By: Vuong, Quan-Hoang; Nguyen, Minh-Hoang; Jin, Ruining; Le, Tam-Tri
    Abstract: The current manuscript sets out the initiation of a book project about “Cultural Additivity Theory” by laying out the basic distinction of “cultural additivity” with relevant concepts, such as cultural hybridity, syncretism, and creolization.
    Date: 2022–12–25

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