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on History and Philosophy of Economics |
| By: | Burkhard Schipper (Department of Economics, University of California Davis) |
| Abstract: | It is known that there are uncoupled learning heuristics leading to Nash equilibrium in all finite games. Why should players use such learning heuristics and where could they come from? We show that there is no uncoupled learning heuristic leading to Nash equilibrium in all finite games that a player has an incentive to adopt, that would be "evolutionary stable" or that "could learn itself". Rather, a player has an incentive to strategically teach such a learning opponent in order secure at least the Stackelberg leader payoff. The impossibility result remains intact when restricted to the classes of generic games, two-player games, potential games, games with strategic complements or 2x2 games, in which learning is known to be "nice". More generally, it also applies to uncoupled learning heuristics leading to correlated equilibria, rationalizable outcomes, iterated admissible outcomes, or minimal curb sets. A possibility result restricted to "strategically trivial" games fails if some generic games outside this class are considered as well. |
| Keywords: | Learning in games, learning heuristics, learning rules, interactive learning, uncoupled learning, meta-learning, reputation, Nash equilibrium, correlated equilibrium, rationalizability, iterated admissibility, minimal curb sets, dominance solvable games, common interest games |
| JEL: | C72 C73 |
| Date: | 2015–04–14 |
| URL: | http://d.repec.org/n?u=RePEc:cda:wpaper:15-1&r=hpe |
| By: | Hansjörg Klausinger (Department of Economics, Vienna University of Economics and Business) |
| Abstract: | The Nationalökonomische Gesellschaft (Austrian Economic Association, NOeG) provides a prominent example of the Viennese economic circles that more than academic economics dominated scientific discourse in the interwar years. For the first time this paper gives a thorough account of its history, from its foundation 1918 until the demise of its long-time president, Hans Mayer, 1955, based on official documents and archival material. The topics treated include its predecessor and rival, the Gesellschaft österreichischer Volkswirte, the foundation 1918 soon to be followed by years of inactivity, the relaunch by Mayer and Mises, the survival under the NS-regime and the expulsion of its Jewish members, and the slow restoration after 1945. In particular, an attempt is made to provide a list of the papers presented to the NOeG, as complete as possible, for the period 1918-1938. |
| Keywords: | History of economic thought, Austrian school of economics, Vienna economic circles, University of Vienna |
| JEL: | A14 B13 B25 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp195&r=hpe |
| By: | Kakarot-Handtke, Egmont |
| Abstract: | For a host of compelling methodological reasons, homo oeconomicus has to be replaced. This is consensus, the open question is how this could be accomplished. What is required first is the separation of the formal foundations into a structural and a behavioral part. This paper introduces the propensity function as general formalization of Economic Man/Woman. The propensity function is a compact formal expression of random, semi-random, and deterministic behavioral assumptions. It is shown how, in a random environment, target-oriented behavior produces stochastic stability and optimality in the product market. With homo oeconomicus the conception of simultaneous equilibrium, too, vanishes. |
| Keywords: | new framework of concepts; structure-centric; axiom set; determinism; indeterminism; propensity function; information function; action function; Law of Supply and Demand; price setting |
| JEL: | B59 D01 D8 |
| Date: | 2015–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:64035&r=hpe |
| By: | Musegaas, M. (Tilburg University, Center For Economic Research); Borm, P.E.M. (Tilburg University, Center For Economic Research); Quant, M. (Tilburg University, Center For Economic Research) |
| Abstract: | In this paper we introduce three-valued simple games as a natural extension<br/>of simple games. While simple games are used to evaluate single voting systems, three-valued simple games offer the opportunity for a simultaneous analysis of two different voting systems within the same parliamentary body. This paper analyzes the core and the Shapley value of three-valued simple games. Using the concept of vital players, the vital core is constructed and we show that the vital core is a subset of the core. The Shapley value is characterized on the class of all three-valued simple games. The model is applied to evaluate the relative influence of countries within the current EU-28 Council. |
| Keywords: | simple games; three-valued simple games; core; Shapley value |
| JEL: | C71 C44 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiucen:473afd5c-99b1-4073-888f-2006e20fbf5f&r=hpe |
| By: | Maroš Servátka (University of Canterbury); Daniel Woods |
| Abstract: | This paper tests Psychological Forward Induction in the Lost Wallet Game, in an attempt to explain an empirical puzzle observed by Dufwenberg & Gneezy (2000) that the size of the outside option forgone by the first mover does not affect the behavior of the second mover. This is puzzling as Psychological Forward Induction and other theories predict that raising the outside option will increase the reward provided by the second mover to the first mover for foregoing the outside option. Our experiment tests whether the second movers update their beliefs after observing their paired first movers’ decision by eliciting beliefs with different second mover knowledge of first mover decision, depending on treatment. We find that second movers do update their beliefs conditional on receiving information on the first mover’s action, supporting Psychological Forward Induction. |
| Keywords: | beliefs, experiment, guilt aversion, lost wallet game, psychological forward induction |
| JEL: | C70 C91 |
| Date: | 2015–05–03 |
| URL: | http://d.repec.org/n?u=RePEc:cbt:econwp:15/09&r=hpe |
| By: | Jo Laban Peryman (RMIT University, Melbourne); David Kelsey (Department of Economics, University of Exeter) |
| Abstract: | We run experiments with a stag hunt and bargaining coordination game. Using a between-subjects design, we vary the identity of the opponent between someone of the same culture or a different culture. The idea is to see whether cultural norms or identity play a part in coordination decisions. We compare the responses of British and Asian students at the University of Exeter and show the cultural identity of the opponent by physical appearance. The players appear to use cultural stereotypes to predict behaviour, especially in the bargaining game which may require more strategic thought than the stag hunt game. In particular, the British act in way that indicates they believe the Asians will behave more cautiously than other British. According to our results, the stereotype of Asians being cautious is misleading. |
| Keywords: | culture,identity, norms, coordination, bargaining |
| JEL: | C29 C71 C72 Z13 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:exe:wpaper:1505&r=hpe |
| By: | Paul Pezanis-Christou (School of Economics, University of Adelaide); Werner Güth (LUISS, 32 Viale Romania, 00197 Rome, Italy. Frankfurt School of Finance and Management, 9-11 Sonnemann St., 60314 Frankfurt, Germany. Max Planck Institute for Research on Collective Goods, 10 Kurt-Schumacher St., 53113 Bonn, Germany.) |
| Abstract: | The risk-neutral equilibrium bidding strategy for first-price auctions with independent private values is justified without assuming a well-defined Bayesian game. Bidders, aware of their own value, assume the private values to be linearly related. The latter, however, are independent and identically distributed, and this is only known by Nature. Allowing for arbitrary linear common value beliefs, and assuming optimal bidding for such beliefs we derive the unique evolutionarily stable conjectural belief and justify risk neutral bidding in a new and hopefully innovative way. |
| Keywords: | Evolutionarily stable strategy, indirect evolution, first-price auction, independent private values, symmetric Bayes-Nash equilibrium. |
| JEL: | C7 D4 D8 |
| URL: | http://d.repec.org/n?u=RePEc:adl:wpaper:2015-13&r=hpe |
| By: | Sergei Guriev; Daniel Treisman |
| Abstract: | We develop an informational theory of dictatorship. Dictators survive not because of their use of force or ideology but because they convince the public—rightly or wrongly—that they are competent. Citizens do not observe the dictator's type but infer it from signals inherent in their living standards, state propaganda, and messages sent by an informed elite via independent media. If citizens conclude that the dictator is incompetent, they overthrow him in a revolution. The dictator can invest in making convincing state propaganda, censoring independent media, co-opting the elite, or equipping police to repress attempted uprisings—but he must finance such spending at the expense of the public's living standards. We show that incompetent dictators can survive as long as economic shocks are not too large. Moreover, their reputations for competence may grow over time—even if living standards fall. Censorship and co-optation of the elite are substitutes, but both are complements of propaganda. Due to coordination failure among members of the elite, multiple equilibria emerge. In some equilibria the ruler uses propaganda and co-opts the elite; in others, propaganda is combined with censorship. In the equilibrium with censorship, difficult economic times prompt higher relative spending on censorship and propaganda. The results illuminate tradeoffs faced by various recent dictatorships. |
| JEL: | H5 P16 |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:21136&r=hpe |
| By: | Cemal Eren Arbatli (National Research University Higher School of Economics); Quamrul H. Ashraf (Williams College); Oded Galor (Brown University) |
| Abstract: | This research establishes that the emergence, prevalence, recurrence, and severity of intrastate conflicts in the modern era reflect the long shadow of prehistory. Exploiting variations across national populations, it demonstrates that genetic diversity, as determined predominantly during the exodus of humans from Africa tens of thousands of years ago, has contributed significantly to the frequency, incidence, and onset of both overall and ethnic civil conflict over the last half-century, accounting for a large set of geographical and institutional correlates of conflict, as well as measures of economic development. Furthermore, the analysis establishes the significant contribution of genetic diversity to the intensity of social unrest and to the incidence of intragroup factional conflict. These findings arguably reflect the contribution of genetic diversity to the degree of fractionalization and polarization across ethnic, linguistic, and religious groups in the national population; the adverse influence of genetic diversity on interpersonal trust and cooperation; the contribution of genetic diversity to divergence in preferences for public goods and redistributive policies; and the potential impact of genetic diversity on economic inequality within a society. |
| Keywords: | Civil conflict, genetic diversity, fractionalization, polarization, interpersonal trust, preferences for public goods, economic inequality |
| JEL: | D74 N30 N40 O11 O43 Z13 |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:wil:wileco:2015-08&r=hpe |
| By: | Guillaume Allegre (OFCE); Xavier Timbeau (OFCE) |
| Abstract: | Dans son ouvrage Le capital au XXIe siècle, Thomas Piketty propose une analyse critique de la dynamique de l’accumulation du capital. L’auteur montre que si le rendement du capital (r) est plus élevé que la croissance économique (g), ce qui a pratiquement toujours été le cas dans l’histoire, alors il est presque inévitable que les patrimoines hérités dominent les patrimoines constitués et que la concentration du capital atteigne des niveaux extrêmement élevés. Le livre cherche ainsi des fondements macroéconomiques (r>g) aux inégalités alors que les explications habituelles sont d’ordre micro-économique. Nous soulignons que l’on peut interpréter les faits décrits selon une causalité différente où les inégalités découlent du fonctionnement (imparfait) des marchés, des rentes de rareté et de l’établissement des droits de propriété. Selon cette interprétation, ce n’est pas r>g qui a transformé les entrepreneurs en rentiers, mais la mise en place de mécanismes permettant l’extraction d’une rente perpétuelle qui explique la constance historique r>g. Cette interprétation différente des mêmes phénomènes a des conséquences en termes de politique publique. L’imposition ex post du capital, si nécessaire, ne peut être qu’un choix de second rang : il faut d’abord lever les contraintes de rareté et se préoccuper de la définition des droits de propriété ainsi que des droits des propriétaires et des non-propriétaires |
| Keywords: | capital; revenu; inegalités; croissance; redistribution; impot |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/6cveipjp238a0afbjf8ivdsi62&r=hpe |
| By: | Jean-Luc Gaffard (OFCE) |
| Abstract: | Le livre de Thomas Piketty Le Capital au XXIe siècle est ambivalent. D'un côté, une lecture théorique trop simple, fondamentalement a-institutionnelle, retient un taux de croissance définitivement exogène et ignore l'hétérogénéité du capital, faisant de la répartition des revenus et des richesses une donnée technique sans influence en retour sur la croissance elle-même. D'un autre côté, les faits stylisés rassemblés et les intuitions qui y sont associées incitent réfléchir sur les tenants et aboutissants de la répartition des revenus et des patrimoines pour lui redonner une place centrale dans la théorie économique et lui restituer sa dimension sociale. |
| Keywords: | capital; croissance; rente; repartition; richesse |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/4eus3ho3fk813p8qcqfc1gaft2&r=hpe |
| By: | Thomas Piketty (Paris-Jourdan Sciences Economiques) |
| Abstract: | Je voudrais tout d’abord résumer brièvement ce que j’ai essayé de faire dans ce travail. Il s’agit avant tout d’un livre sur l’histoire du capital et de la répartition des richesses, et des conflits suscités par cette inégale répartition. Mon principal objectif a été de rassembler, grâce au travail combiné d’une trentaine de chercheurs (notamment Anthony Atkinson, Emmanuel Saez, Gilles Postel-Vinay, Jean-Laurent Rosenthal, Facundo Alvaredo et Gabriel Zucman), des sources historiques portant sur l’évolution des patrimoines et des revenus dans plus de vingt pays depuis le 18e siècle. La première ambition de ce livre est de présenter ces matériaux historiques de façon cohérente (...). |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/78dsucmgm383trsarl5cbcar9t&r=hpe |