nep-evo New Economics Papers
on Evolutionary Economics
Issue of 2024‒03‒11
four papers chosen by
Matthew Baker, City University of New York


  1. The dawn of civilization. Metal trade and the rise of hierarchy By Matthias Flückiger; Mario Larch; Markus Ludwig; Luigi Pascali
  2. Similarity and Comparison Complexity By Cassidy Shubatt; Jeffrey Yang
  3. Behavioral Economics for All: From Nudging to Leadership By Julia M. Puaschunder
  4. Towards sustainable agriculture: behaviors, spatial dynamics and policy in an evolutionary agent-based model By Matteo Coronese; Martina Occelli; Francesco Lamperti; Andrea Roventini

  1. By: Matthias Flückiger; Mario Larch; Markus Ludwig; Luigi Pascali
    Abstract: In the latter half of the fourth millennium BC, our ancestors witnessed a remarkable transformation, progressing from simple agrarian villages to complex urban civilizations. In regions as far apart as the Nile Valley, Mesopotamia, Central Asia, and the Indus Valley, the first states appeared together with writing, cities with populations exceeding 10, 000, and unprecedented socio-economic inequalities. The cause of this “Urban Revolution†remains unclear. We present new empirical evidence suggesting that the discovery of bronze and the ensuing long-distance trade played a crucial role. Using novel panel data and 2SLS techniques, we demonstrate that trade corridors linking metal mines to fertile lands were more likely to experience the Urban Revolution. We propose that transit bottlenecks facilitated the emergence of a new taxing elite. We formally test this appropriability theory and provide several case studies in support.
    JEL: D02 F10 H10 N40 O43
    Date: 2024–01
    URL: http://d.repec.org/n?u=RePEc:upf:upfgen:1878&r=evo
  2. By: Cassidy Shubatt; Jeffrey Yang
    Abstract: Some choice options are more difficult to compare than others. This paper develops a theory of what makes a comparison complex, and how comparison complexity generates systematic mistakes in choice. In our model, options are easier to compare when they 1) share similar features, holding fixed their value difference, and 2) are closer to dominance. We show how these two postulates yield tractable measures of comparison complexity in the domains of multiattribute, lottery, and intertemporal choice. Using experimental data on binary choices, we demonstrate that our complexity measures predict choice errors, choice inconsistency, and cognitive uncertainty across all three domains. We then show how canonical anomalies in choice and valuation, such as context effects, preference reversals, and apparent probability weighting and present bias in the valuation of risky and intertemporal prospects, can be understood as responses to comparison complexity.
    Date: 2024–01
    URL: http://d.repec.org/n?u=RePEc:arx:papers:2401.17578&r=evo
  3. By: Julia M. Puaschunder (Columbia University, USA)
    Abstract: Behavioral economics is an innovative applied science. In the 1950s economic rational choice models came under scrutiny. A theoretical critique emerged that not all human beings strive for efficiency and rationality all the time. Behavioral economics first drew attention to deviations from rationality and discussed the non-applicability of rational choice models for depicting the actual behavior of humans. During the 1970s, Amartya Sen formalized the rational choice critique and published powerful examples of how economics needs a reality check and backtesting of its core axioms of rationality, efficiency and time consistency for actual real-world relevancy and external validity of the standard rational choice claims. By 1979, the two psychologists Daniel Kahneman and Amos Tversky presented a line of laboratory experiments at universities that proved the rational choice theory to be inaccurate to explain the real-world decision-making patterns of individuals. The following behavioral economics revolution rewrote economics for accuracy and predictability for actual human day-to-day choices and behavior. Sociologists, political scientists, psychologists created a line of research to describe how individuals actually decide during the first decade of the 2000s. Behavioral insights were then used to find ways how to ‘nudge’ individuals, communities and leaders to help others make better choices in different domains, for instance such as finance, marketing, health and well-being. Around the world, governmental officials and governance experts adopted behavioral nudges and winks to create better choice architectures and decision-making patterns. This paper describes the history of behavioral economics with attention to North American roots and European interpretations in order to then prospect future trends in behavioral economics. First, given the enormous popularity behavioral economics has enjoyed in the most recent decades, a general knowledge has formed about behavioral nudges. Libertarian paternalism is – by now – limited when it comes to implicitly tricking people into making choices based on well-known insights. A common body of knowledge on behavioral aspects of choice patterns may lead to reactance if people notice manipulation. The general population should therefore be trained to make self-empowered choices that meet their individual principles, needs and wants based on their behavioral expertise. Behavioral economists should move from manipulating nudges to educating trainings of the layperson. Second, the field of behavioral sciences has experienced a deep replication crisis given major data cheating scandals and contemporary fraud allegations. General oversight mechanism between co-authors, backtesting of effects for validity and their general applicability is therefore warranted. he general population should be trained to be critical of behavioral insights presented to them and be encouraged by behavioral economists to feedback on the potential non-applicability of p-hacked results. Third, online searchplace distortion of behavioral economics results has become a sad reality for young behavioral economists in the strategic search engine results manipulation through Search Engine Disoptimization (SEDO). This implicit internet harassment calls for a democratization of information and whole-rounded inclusion of thoughts online. Behavioral economists should raise awareness for this negative competitive behavior and work together with global governance institutions, regulatory bodies but also industry professionals to curb negative internet search engine manipulation and empower the upcoming generation of behavioral economists to speak up when this is happening. Professional bodies should be informed to help those whose career has been hit by competitive internet manipulation. All these trends are speculated to lead to a revamped behavioral economics revolution that demands for behavioral economics for all. The future of behavioral economics is believed to lie in self-empowered leadership, not manipulation. A democratization of behavioral economics information leading to a general knowledge basis on actual behavioral patterns will guide a self-empowered decision-making cadre within the general population. Search for true and credible behavioral insights can lift the entire field to a more helpful stage to become a standing guidepost for wise quality decision-making. The digital millennium calling for fair internet use will hopefully prosper an inclusive and diversified information on behavioral insights to be accessible, useful and meaningful for all.
    Keywords: Behavioral Economics, Behavioral Finance, Behavioral Insights
    Date: 2023–08
    URL: http://d.repec.org/n?u=RePEc:smo:raiswp:0293&r=evo
  4. By: Matteo Coronese; Martina Occelli; Francesco Lamperti; Andrea Roventini
    Abstract: Economic and population growth increasingly pressure the Earth system. Fertile soils are essential to ensure global food security, requiring high-yielding agro-technological regimes to cope with rising soil degradation and macro-nutrients deficiencies, which may be further exacerbated by climate change. In this work, we extend the AgriLOVE land-use agent-based model (Coronese et al., 2023) to investigate trade-offs in the transition between conventional and sustainable farming regimes in a smallholder economy exposed to explicit environmental boundaries. We investigate the ability of the system to favor a sustainable transition when prolonged conventional farming leads to soil depletion. First, we showcase the emergence of three endogenous scenarios of transition and lock-in. Then, we analyze transition dynamics under several behavioral, environmental and policy scenarios. Our results highlights a strong path-dependence of the agricultural sector, with scarce capacity to foster successful transitions to a sustainable regime in absence of external interventions. The role of behavioral changes is limited and we find evidence of negative tipping points induced by mismanagement of grassland and forests. These findings call for policies strongly supporting sustainable agriculture. We test regulatory measures aimed at protecting common environmental goods and public incentives to encourage the search for novel production techniques targeted at closing the sustainable-conventional yield gap. We find that their effectiveness is highly time-dependent, with rapidly closing windows of opportunity.
    Keywords: Agriculture; Land use; Agent-based model; Technological change; Transition; Environmental boundaries; Sustainability
    Date: 2024–02–20
    URL: http://d.repec.org/n?u=RePEc:ssa:lemwps:2024/05&r=evo

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