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on Evolutionary Economics |
| By: | Cao, Gewei (RS: GSBE other - not theme-related research, Microeconomics & Public Economics); Schmitt, Maximilian L. (RS: GSBE other - not theme-related research, Microeconomics & Public Economics); Rusch, Hannes (Microeconomics & Public Economics, RS: GSBE other - not theme-related research) |
| Abstract: | Slavery has taken strikingly different forms across human history. One of the sharpest contrasts concerns the fate of the enslaved: some societies were open to the integration of enslaved persons as full members, whereas others held them in permanent bondage. Existing ecological accounts try to explain slavery as a response to conditions favoring surplus production. They predict when slavery may appear, but not whether the enslaved are integrated. We argue that inter-societal conflict closes this gap. We develop a model of institutional adaptation in which societies raid one another for captives, produce a surplus, and then fight to loot that surplus. Three institutions compete: raiding for loot but not for captives, enslaving captives for maximal extraction, and exploiting captives but later integrating them as free members who help defend the surplus. Integration proves adaptive precisely where conflict is intense, because additional defenders are then worth more than the extra surplus that harsher treatment would have yielded; as theproductivity of unfree labor rises, exploitation without integration prevails instead. We assess these ideas against ethnographic data onslaving and conflict available for the Indigenous Peoples of the Pacific Coast of North America. Measuring conflict exposure by the raiding frequency of a society’s neighbors, we indeed observe that greater exposure predicts a higher probability of integrating enslaved persons, a pattern that neither ecology nor cultural affiliation alone can account for. |
| Keywords: | slavery, exploitation, manumission, strong asymmetric dependence, cultural evolution |
| Date: | 2026–10–26 |
| URL: | https://d.repec.org/n?u=RePEc:unm:umagsb:2026012 |
| By: | Oded Galor (Brown University); Luca Pensieroso (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES)); Daniel C. Wainstock (University of Oxford) |
| Abstract: | How could inequality between social classes have ever persisted during the Malthusian epoch, as affluence led to greater reproductive success, diluting inherited wealth and narrowing disparities over time? This paper uncovers the Paradox of Inequality, establishes its robust theoretical foundations, and provides its resolution. The analysis suggests that elites’ lavish, nonproductive displays of status inadvertently diverted resources from reproduction, limiting the dilution of inherited wealth and sustaining inequality across generations. Ironically, extravagance preserved the wealth it seemed to squander. |
| Keywords: | Inequality, Malthusian Epoch, Conspicuous consumption, Fertility, Paradox |
| JEL: | O10 Z10 |
| Date: | 2026–10–12 |
| URL: | https://d.repec.org/n?u=RePEc:ctl:louvir:2026018 |
| By: | Nicholas C. Barberis |
| Abstract: | Behavioral finance seeks to improve our understanding of markets, investors, and firms by adopting a psychologically realistic description of how people think. While behavioral finance ideas have been part of human discourse for decades if not centuries, the modern research effort in the field began in the 1980s. Forty years later, behavioral finance is a vibrant area of financial economics. In this article, I explain why by reviewing some of its recent progress. I focus on three topics – beliefs about future earnings, beliefs about future returns, and prospect theory – and on their applications to understanding asset prices and investor behavior. I close by commenting on some new directions in the field – cognitive foundations, non-traditional decision processes, and artificial intelligence. |
| JEL: | G11 G12 G14 G40 G50 |
| Date: | 2026–10 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35959 |
| By: | Gardner, Leigh A. |
| Abstract: | African economic history has experienced a revival during the 21st century through the globalisation of economic history as a field and a growing interest in how history has shaped current economic inequalities. This survey reviews the development of the field since its initial foundations, and illustrates the ways in which more recent work has diverged in its methods and approaches. It focuses on three main themes: the effort to bring Africa into global economic history through the construction of comparative datasets and the application of methods derived from the study of other regions; the role of African institutions in shaping these patterns of economic development; and looking beyond the state to religion, culture and entrepreneurship. The survey concludes by identifying some gaps and ideas for future research. |
| JEL: | N0 |
| Date: | 2026–10–26 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:141699 |
| By: | Hannah H. Chen (Department of Finance, National Central University); Cary Deck (Department of Economics, University of Alabama & Economic Science Institute, Chapman University); Rachel J. Huang (Department of Finance, National Central University); Larry Y. Tzeng (Department of Finance, National Taiwan University); Lin Zhao (School of Business Administration, Southwestern University of Finance and Economics) |
| Abstract: | Economic decisions often involve uncertainty in both wealth and time. We introduce an axiom requiring the trade-of between wealth and time to remain invariant across both domains. Together with standard axioms, it characterizes Expected Additive Time-Wealth Utility (EATWU). We provide an alternative characterization based on consistency in higher-order risk preferences and extend risk apportionment to decisions involving wealth, time, and both. Our model predicts consistent risk allocations across these domains within each order. A laboratory experiment examining second-, third-, and fourth-order risk preferences fnds systematic relationships across domains that are broadly consistent with the model’s predictions. |
| Keywords: | Time and Wealth, Cross-Domain Stationarity, Higher-Order Risk Preferences, Risk Apportionment, Experimental Economics |
| JEL: | C9 D8 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:chu:wpaper:26-13 |
| By: | Moira Gidseg (College of the Holy Cross) |
| Abstract: | In this study, I propose a new model of distributional preferences, the “Bliss Point†model. According to this model, each person has a preferred payoff for others which is a linear function of his own payoff, and he suffers a utility penalty proportional to the distance between this bliss point for his co-players and the actual payoffs. To evaluate the empirical relevance of this model, I create an experiment in which subjects play several games which affect both their own payoff and that of an anonymous partner. I used their behavior to estimate individual-level parameters of my model as well as three others: inequality aversion (Fehr & Schmidt, 1999), quasi-maximin (Charness & Rabin, 2002), and constant elasticity of substitution (Andreoni & Miller, 2002). I then compare the models’ ability to predict behavior out-ofsample. I find that the Bliss Point model generally predicts about as well as the other models. Further, it is a better predictor than the other models for up to 7% of subjects, depending on the task. This suggests that the Bliss Point model is a useful alternative to existing models. |
| JEL: | C72 D64 C91 H41 D91 |
| Date: | 2026–10 |
| URL: | https://d.repec.org/n?u=RePEc:hcx:wpaper:2601 |
| By: | Adi Tarabeih |
| Abstract: | Prospect theory splits risky choice into three parts: loss aversion, measured by the relative weight of losses to gains, $\lambda$ (e.g., $\lambda = 2$ implies that losses weigh twice as much as gains), diminishing sensitivity to the size of outcomes (i.e., the curvature and linearity of the value function), and the nonlinear weighting of probabilities. I examined whether Large Language Models (LLMs) display the same properties as people by meta-analyzing 102 fitted estimates from 11 studies covering 32 language models. The three components emerge differently. Loss aversion is modest: the pooled $\lambda$ is 1.26 (95% CI 1.06 to 1.46), far below the strongest human meta-analytic estimate ($\lambda = 1.96$) and compatible with more conservative ones (1.07 and 1.31). Matched by design, LLMs are compatible with people when gains and losses are symmetric ($\lambda = 1.15$ against 1.07), but well below them when losses are smaller than gains (1.46 against 2.3), where human loss aversion is strongest. Value functions are close to linear rather than concave under the Tversky-Kahneman method (1.01, against a human value of 0.67), but more concave than in people under the Tanaka method (0.52, against 0.67), so diminishing sensitivity depends on how it is measured. Probability weighting shows a human-like inverse S shape ($\gamma = 0.81$ under Tversky-Kahneman and 0.84 under the Tanaka method), though on few studies. In sum, LLMs show little loss aversion and little diminishing sensitivity, but retain human-like probability distortion, yet these generalizations shift when looking at specific model families and fitting methods. |
| Date: | 2026–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2610.33103 |