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on Evolutionary Economics |
| By: | Francesco Feri; Miguel A.Meléndez-Jiménez |
| Abstract: | This paper studies an evolutionary model of network formation with endogenous decay, in which agents benefit both from direct and indirect connections. In addition to forming (costly) links, agents choose actions for a coordination game that determines the level of decay of each link. We address the issues of coordination (long-run equilibrium selection) and network formation by means of stochastic stability techniques. We find that both the link cost and the trade-off between efficiency and risk-dominance play a crucial role in the long-run behavior of the system. |
| Keywords: | Coordination, Networks, Risk dominance, stochastic stability |
| JEL: | C72 C73 D83 D85 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2009-19&r=evo |
| By: | Musau, Andrew |
| Abstract: | One area that is often overlooked by economists and social scientists is discounting. Most economic models of intertemporal choice make use of Samuelson's (1937) DU model which leads to an exponential discount function. Divergences from what economic modelling predicts and empirical findings are on the most part attributed to factors other than the discount function employed. We review the literature on the DU model and identify its behavioral anomalies. We look into suggested quasi-hyperbolic and hyperbolic models that in part account for these anomalies. We analyze an infinite IPD game and demonstrate that under quasi-hyperbolic discounting, cooperation emerges as an SPE at a higher level of the discount factor. We further demonstrate that the unemployment equilibrium in the Shapiro & Stiglitz (1984) Shirking model is not static under both hyperbolic and quasi-hyperbolic discounting. |
| Keywords: | intertemporal; exponential; quasi-hyperbolic; hyperbolic. |
| JEL: | A10 |
| Date: | 2009–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16416&r=evo |
| By: | Simon Gächter |
| Abstract: | Experimental economics is an established method of generating controlled and replicable empirical knowledge. It is complementary to other empirical methods in the social sciences. The research infrastructure for laboratory experiments is very good in Europe and also in Germany. One useful instrument would be to develop a short socio-economic questionnaire with questions already used in surveys that experimental economists could use to administer to their participants. The analyses of the selectivity of subject pools would then be an easy task. However, among experimental economists no standard exists yet, which limits the comparability of respective data sets. An effort shall be undertaken to “create” such a common questionnaire. The status quo with regard to data reporting is that no standard has emerged yet. There exists one data repository (in the United States) where data of experiments are collected and are freely available. Building up a data archive that integrates (merges) existing data is very laborious and requires substantial scientific inputs of interested researchers. |
| Keywords: | Experimental economics, data archives, selectivity of subject pools |
| JEL: | C81 C9 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:rsw:rswwps:rswwps24&r=evo |
| By: | Ivan Moscati; Paola Tubaro |
| Abstract: | Rational choice theory (RCT) models decision makers as utility maximizers and is often defended via an as-if argument. According to this argument, although real individuals do not consciously maximize their utility function, their choices can be explained as if they were generated by utility maximization. An alternative model is random-choice, which assumes that decision makers pick up an element from a given set according to a uniform distribution on the set. In this paper we examine a series of experiments that compare RCT and the random-choice model as alternative explanations of consumer demand, and investigate how these experiments contribute to clarifying the actual scope of RCT and the shortcomings of the standard as-if defense of it. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pse:psecon:2009-21&r=evo |