nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2023‒06‒26
eight papers chosen by
Matthew Baker
City University of New York

  1. Heterogeneous Noise and Stable Miscoordination By Srinivas Arigapudi; Yuval Heller; Amnon Schreiber
  2. Social Preferences: Fundamental Characteristics and Economic Consequences By Fehr, Ernst; Charness, Gary
  3. Qanats By Alireza Naghavi; Mohsen Shaeyan
  4. Implementing the Process Tracing Technique using Combinatory Categorial Grammars: An Application to the Analysis of Economic Coordination within Firms By da Rocha Braga, Bruno
  5. Entrepreneurship culture: Aggregate trait or collective programming of the mind? By Stützer, Michael
  6. Social Organizations and Political Institutions: Why China and Europe Diverged By Joel Mokyr; Guido Tabellini
  7. The Dynastic Transmission of Power, Exit Options and the Coevolution of Rent-Seeking Elites By Arthur Silve; Thierry Verdier; Thierry Verdier
  8. Image Concerns and the Dynamics of Prosocial Behavior By Jana Hofmeier; Louis Strang

  1. By: Srinivas Arigapudi; Yuval Heller; Amnon Schreiber
    Abstract: Coordination games admit two types of equilibria: pure equilibria, where all players successfully coordinate their actions, and mixed equilibria, where players frequently experience miscoordination. The existing literature shows that under many evolutionary dynamics, populations converge to a pure equilibrium from almost any initial distribution of actions. By contrast, we show that under plausible learning dynamics, where agents observe the actions of a random sample of their opponents and adjust their strategies accordingly, stable miscoordination can arise when there is heterogeneity in the sample sizes. This occurs when some agents make decisions based on small samples (anecdotal evidence) while others rely on large samples. Finally, we demonstrate the empirical relevance of our results in a bargaining application.
    Date: 2023–05
  2. By: Fehr, Ernst (University of Zurich); Charness, Gary (University of California, Santa Barbara)
    Abstract: We review the vast literature on social preferences by assessing what is known about their fundamental properties, their distribution in the broader population, and their consequences for important economic and political behaviors. We provide, in particular, an overview of the empirically identified characteristics of distributional preferences and how they are affected by merit, luck, and risk considerations as well as by concerns for equality of opportunity. In addition, we identify what is known about belief-dependent social preferences such as reciprocity and guilt aversion. The evidence indicates that the big majority of individuals have some sort of social preference while purely self- interested subjects are a minority. Our review also shows how the findings from laboratory experiments involving social preferences provide a deeper understanding of important field phenomena such as the consequences of wage inequality on work morale, employees' resistance to wage cuts, individuals' self-selection into occupations and sectors that are more or less prone to morally problematic behaviors, as well as issues of distributive politics. However, although a lot has been learned in recent decades about social preferences, there are still many important, unresolved, yet exciting, questions waiting to be tackled.
    Keywords: social preferences, altruism, inequality aversion, image concerns, reciprocity
    JEL: D0 D2 D9 H0 J0 P0
    Date: 2023–05
  3. By: Alireza Naghavi (University of Bologna); Mohsen Shaeyan (Johannes Gutenberg University Mainz)
    Abstract: Qanats – traditional Persian irrigation systems first built around 1000 B.C. – required a complex of cooperative local institutions for their construction and maintenance. We show that these institutions produced a (local) culture of cooperation in Iran that persists to the present day when qanats are no longer of economic value. We use unique geo-coded data on qanat coordinates in Iran together with information collected and digitized on cooperative enterprises and find a positive relationship between qanat locations and cooperative activities today. We build an IV using grid-level geological preconditions necessary for the construction and functioning of qanats: gently sloped terrains and intermediate clay content. The cooperation culture persists particularly close to historical trade routes and in areas with stable climatic conditions. The results hold for alternative proxies of social capital, namely the degree to which people trust their neighbours and the pervasiveness of charity-based Islamic microfinance establishments.
    Keywords: Irrigation, Cooperation, Qanat, Cooperatives, Social capital, Trade routes, Culture, Persistence
    JEL: N55 O13 O53 Q13 Q15 Z10 D70
    Date: 2023–06–14
  4. By: da Rocha Braga, Bruno
    Abstract: This paper describes a method for analyzing the evolutionary path of a complex, dynamic, and contingent social phenomenon. Given empirical evidence of a surprising or anomalous fact that contradicts a widely acknowledged theory, the aim is to create a plausible explanation based on its context of occurrence, taking a holistic and historical point of view. The procedure begins by translating theoretical propositions into grammar rules that describe patterns of sequences of either individual actions or interactions carried out by a stable community of actors, such as types of decision-making events. Subsequently, applying a process tracing technique based on the logic of retroduction creates an extension of this initial process category, relying on configurations of contextual conditions that acknowledge the surprising fact as a new event outcome in a specific empirical setting. Finally, a structural comparison between pairs of representative instances may lead to the refinement of the theory.
    Keywords: Critical Realism; Configurational Analysis; Generative Social Science; Pragmatism; Theory of the Firm.
    JEL: L23
    Date: 2023–05–31
  5. By: Stützer, Michael
    Abstract: The answer is yes to both. For decades, research on entrepreneurship culture has relied on two competing theoretical foundations for the important concept of entrepreneurship culture. One camp views entrepreneurship culture as an aggregate of personality traits conducive for entrepreneurship. The other camp applies Hofstede's (1980) definition of culture as 'collective programming of the mind' towards entrepreneurship (e.g., Beugelsdijk, 2007, Hofstede et al., 2004; Stephan and Uhlander, 2010). In this paper I present empirical evidence that measures of entrepreneurship culture reflecting both approaches explain entrepreneurial intentions and action. Entrepreneurship culture is thus both - an aggregate personality trait and a collective programming of the mind.
    Date: 2023
  6. By: Joel Mokyr; Guido Tabellini
    Abstract: This paper discusses the historical and social origins of the bifurcation in the political institutions of China and Western Europe. An important factor, recognized in the literature, is that China centralized state institutions very early on, while Europe remained politically fragmented for much longer. These initial differences, however, were amplified by the different social organizations (clans in China, corporate structures in Europe) that spread in these two societies at the turn of the first millennium AD. State institutions interacted with these organizations, and were shaped and influenced by this interaction. The paper discusses the many ways in which corporations contributed to the emergence of representative institutions and gave prominence to the rule of law in the early stages of state formation in Europe, and how specific features of lineage organizations contributed to the consolidation of the Imperial regime in China.
    Date: 2023
  7. By: Arthur Silve; Thierry Verdier; Thierry Verdier
    Abstract: We introduce a dynamic model that investigates the persistence and evolution of elite-dominated societies, where inherited political capital determines one’s social standing. Our analysis highlights the critical role of the distribution of exit options in the evolution of political inclusiveness across generations. An elite comparatively more mobile than the masses generally entrenches a politically stratified society, whereas a more widespread distribution of exit options can encourage inclusiveness. Under certain conditions differential mobility may still induce political inclusiveness across generations. Exit options across different political entities lead to a joint evolution of local power structures.
    Keywords: political dynasties, elite dynamics, exit options, rent-seeking, political spillovers
    JEL: D72 F42 H26 P16 P48
    Date: 2023
  8. By: Jana Hofmeier (University of Bonn); Louis Strang (University of Cologne)
    Abstract: This paper studies the dynamic effect of observability on prosocial behavior. We hypothesize a twofold positive effect. First, people should act more prosocially when being observed. Second, this increased level of prosociality should motivate an ongoing elevated altruistic attitude, in accordance with the concept of altruistic capital formation. We test our predictions running two experiments in which subjects make a first donation decision either observed or anonymously. Subsequently, all subjects face a second anonymous donation decision. In gen- eral, we observe high rates of altruistic behavior. However, we find only weak positive effects of observability on first-stage prosocial behavior and no effects on second-stage prosocial behavior.
    Keywords: Prosocial Behavior, Donation, Moral Licensing, Altruistic Capital, Social preferences, Lab experiment
    JEL: C91 D64
    Date: 2023–06

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.