nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2023‒02‒27
eight papers chosen by
Matthew Baker
City University of New York

  1. Evolutionarily stable preferences By Ingela Alger
  2. Norms, Emotions, and Culture in Human Cooperation and Punishment: Theory and Evidence By Sanjit Dhami; Mengxing Wei
  3. Patience and Comparative Development By Uwe Sunde; Thomas Dohmen; Benjamin Enke; Armin Falk; David Huffman; Gerrit Meyerheim
  4. Thorstein Veblen, The Meaning of Work, and its Humanization By Jon D. Wisman
  5. Evolution and Kantian morality: a correction and addendum By Alger, Ingela; Weibull, Jörgen W.
  6. Evolution of semi-Kantian preferences in two-player assortative interactions with complete and incomplete information and plasticity By Alger, Ingela; Lehmann, Laurent
  7. Dynamical analysis of evolutionary transition toward sustainable technologies By Fausto Cavalli; Ahmad Naimzada; Enrico Moretto
  8. Cultural homophily and collaboration in superstar teams By Békés, Gábor; Ottaviano, Gianmarco I. P.

  1. By: Ingela Alger (TSE-R - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - Université Fédérale Toulouse Midi-Pyrénées - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)
    Abstract: The 50-year old concept of an evolutionarily stable strategy (ESS) provided a key tool for theorists to model ultimate drivers of behavior in social interactions. For decades economists ignored ultimate drivers and used models in which individuals choose strategies based on their preferences-a proximate mechanism for behavior-and the distribution of preferences in the population was taken to be fixed and given. This article summarizes some key findings in the literature on evolutionarily stable preferences, which in the past three decades has proposed models that combine the two approaches: individuals inherit their preferences, the preferences determine their strategy choices, which in turn determines evolutionary success. One objective is to highlight complementarities and potential avenues for future collaboration between biologists and economists.
    Date: 2023–01–08
  2. By: Sanjit Dhami; Mengxing Wei
    Abstract: We consider the psychological and social foundations of human contributions and punishments in a voluntary contributions mechanism with punishment (VCMP). We eliminate ‘dynamic economic linkages’ between the two stages of our ‘modified’ VCMP to rule out other potential explanations. We use a beliefs-based model, rooted in psychological game theory, to derive rigorous theoretical predictions that are then tested with pre-registered experiments in China and the UK. Social norms, culture, and endogenous emotions are the key determinants of contributions and punishments. The emotions of shame, frustration, and anger, play a key role in our theoretical and empirical analysis through ‘dynamic psychological linkages’. We provide potential microfoundations for the inherent human tendency to follow social norms and punish norm violators, while respecting boundedly rational strategic decision making.
    Keywords: cooperation and punishment, emotions-shame, frustration, anger, social norms, culture, bounded rationality
    JEL: C91 C92 D01 D91
    Date: 2023
  3. By: Uwe Sunde; Thomas Dohmen; Benjamin Enke; Armin Falk; David Huffman; Gerrit Meyerheim
    Abstract: This paper studies the relationship between patience and comparative development through a combination of reduced-form analyses and model estimations. Based on a globally representative dataset on time preference in 76 countries, we document two sets of stylized facts. First, patience is strongly correlated with per capita income and the accumulation of physical capital, human capital and productivity. These correlations hold across countries, subnational regions, and individuals. Second, the magnitude of the patience elasticity strongly increases in the level of aggregation. To provide an interpretive lens for these patterns, we analyze an OLG model in which savings and education decisions are endogenous to patience, aggregate production is characterized by capital-skill complementarities, and productivity implicitly depends on patience through a human capital externality. In our model estimations, general equilibrium effects alone account for a non-trivial share of the observed amplification effects, yet meaningful externalities are needed to quantitatively match the empirical evidence.
    Keywords: Time Preference, Comparative Development, Factor Accumulation
    JEL: D03 D90 O10 O30 O40
    Date: 2021–04
  4. By: Jon D. Wisman
    Abstract: Thorstein Veblen gave special attention to work. He claimed that an instinct of workmanship " present in all men, and asserts itself even under very adverse circumstances... [It] is the court of final appeal in any question of economic truth or adequacy." Although many scholars have examined Veblen's claim, this article differs by examining his conception of work in light of findings from anthropology, evolutionary psychology, and happiness research. The questions explored are: Why and how did Veblen understand work as instinctual and did his understanding conform to Charles Darwin's concept of instincts? Is it an instinct that evolved to be pleasurable or to gain respect and status to motivate provisioning? If evidence supports the claim that work did indeed evolve to be pleasurable, and today much of it is not, then its restructuring should be a top social priority. Although Veblen's understanding of work provides inadequate guidance as to how it should be restructured, he was pathbreaking in insisting that our understanding of this question, and of human behavior and society more generally, must be grounded in the evolutionary biology launched by Darwin. Accordingly, a second aim of this article is to offer support for Veblen's attempt to do so.
    Keywords: instinct of workmanship; Darwinism; institutions; anthropology of work; happiness; research
    JEL: A13 B15 Z10
    Date: 2023
  5. By: Alger, Ingela; Weibull, Jörgen W.
    Abstract: Theorem 1 in Alger and Weibull (Games and Economic Behavior, 2016) consists of two statements. The first establishes that Homo moralis with the right degree of morality is evolutionarily stable. The second statement is a claim about sufficient conditions for other goal functions to be evolutionarily unstable. However, the proof given for that claim presumes that all relevant sets are non-empty, while the hypothesis of the theorem does not guarantee that. We here prove instability under a stronger hypothesis that guarantees existence, and we also establish a new and closely related result. As a by-product, we also obtain an extension of Theorem 1 in Alger and Weibull (Econometrica, 2013).
    Keywords: Preference evolution; evolutionary stability; morality, Homon moralis.
    JEL: C73 D01 D03
    Date: 2023–02–02
  6. By: Alger, Ingela; Lehmann, Laurent
    Abstract: We develop a model for the evolution of preferences guiding behavior in pairwise interactions in groupstructured populations. The model uses the conceptual platform of long-term evolution theory and covers different interaction scenarios, including conditional preference expression upon recognition of interactant’s type. We apply the model to the evolution of semi-Kantian preferences at the fitness level, which combine self-interest and a Kantian interest evaluating own behavior in terms of consequences for own fitness if the interactant also adopted this behavior. We look for the convergence stable and uninvadable value of the Kantian coefficient, i.e., the weight attached to the Kantian interest, a quantitative trait varying between zero and one. We consider three scenarios: (a) incomplete information; (b) complete information and incomplete plasticity; and (c) complete information and complete plasticity, where individuals can, not only recognize the type of their interaction partner (complete information), but also conditionally express the Kantian coefficient upon it (complete plasticity). For (a), the Kantian coefficient tends to evolve to equal the coefficient of neutral relatedness between interacting individuals; for (b), it evolves to a value that depends on demographic and interaction assumptions, while for (c) individuals become pure Kantians when interacting with individuals of the same type, while they apply the Kantian coefficient that is uninvadable in a panmictic population under complete information when interacting with individuals with a different type. Overall, our model connects several concepts for analysing the evolution of behavior rules for strategic interactions that have been emphasized in different and sometimes isolated literatures.
    Keywords: evolution of semi-Kantian preferences; group-structured populations; fitness; convergence stability; uninvadability; Homo moralis
    Date: 2023–02–01
  7. By: Fausto Cavalli; Ahmad Naimzada; Enrico Moretto
    Abstract: We propose a model for exploring the feasibility of the green transition between dirty and clean technologies. It relies on an evolutionary framework for the technology selection interacting with the environmental domain, which describes the evolution of pollution. A regulator charges an ambient tax to the producers, and the agents can choose between the less profitable clean technology and the more profitable dirty one, which however is taxed to a greater extent with respect to the clean one. The environmental tax depends endogenously on the level of pollution, which rises because of the producers’ emissions. The pollution stock also naturally decays, and can be abated by involving the resources collected from the taxation. We analytically study the resulting two-dimensional model from both the static and the dynamical points of view, to understand under what conditions the green transition can take place and results in an improvement for the environmental quality. We show that excessive over-taxation of the dirty technology may be not always beneficial, as steady state pollution level can increase above a certain taxation threshold and multiple steady states can emerge. Moreover, dynamics can result in persistent endogenous oscillations that systematically lead to a significant increase in pollution levels. Finally, we discuss the economic rationale for the results also in the light of possible policy suggestions.
    Date: 2023–01
  8. By: Békés, Gábor; Ottaviano, Gianmarco I. P.
    Abstract: One may reasonably think that cultural preferences affect collaboration in multinational teams in general, but not in superstar teams of professionals at the top of their industry. We reject this hypothesis by creating and analyzing an exhaustive dataset recording all 10.7 million passes by 7 thousand professional European football players from 138 countries fielded by all 154 teams competing in the top 5 men leagues over 8 sporting seasons, together with full information on players' and teams' characteristics. We use a discrete choice model of players' passing behavior as a baseline to separately identify collaboration due to cultural preferences (`choice homophily') from collaboration due to opportunities (`induced homophily'). The outcome we focus on is the `pass rate', defined as the count of passes from a passer to a receiver relative to the passer's total passes when both players are fielded together in a half-season. We find strong evidence of choice homophily. Relative to the baseline, player pairs of same culture have a 2.42 percent higher pass rate due to choice, compared with a 6.16 percent higher pass rate due to both choice and opportunity. This shows that choice homophily based on culture is pervasive and persistent even in teams of very high skill individuals with clear common objectives and aligned incentives, who are involved in interactive tasks that are well defined, readily monitored and not particularly language intensive.
    Keywords: organizations; teams; culture; homophily; diversity; language; globalization; big data; panel data; sport
    JEL: J1
    Date: 2022–10–07

This nep-evo issue is ©2023 by Matthew Baker. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.