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on Evolutionary Economics |
| By: | Kakarot-Handtke, Egmont |
| Abstract: | Standard economic models are based on an axiom set that epitomizes the fundamental behavioral assumptions. The present treatise moves these assumptions from the foreground to the background. The suggested change of perspective is guided by the question: what is the minimum set of foundational propositions for a consistent reconstruction of the evolving money economy? We start with four non-behavioral axioms. Subsequently their logical and factual implications are explored and the building blocks of the general axiomatic model are determined. The switch of the unifying principle resolves the profit conundrum – 'one of the most convoluted and muddled areas in economy theory'. Hence structural axiomatization has ramifications on larger parts of standard economics. By virtue of the axiom set evolution supersedes equilibrium as central organizing idea. |
| Keywords: | Framework of Concepts; Structure-centric; Axiom Set; Propensity Function; General Axiomatic Model; Stochastic Processes;Evolutionary Economics; Evolving Money Economy; e·Economics |
| JEL: | E00 |
| Date: | 2010–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24331&r=evo |
| By: | Herrmann-Pillath, Carsten |
| Abstract: | Recently, the maximum entropy principle has been applied to explain the evolution of complex non-equilibrium systems, such as the Earth system. I argue that it can also be fruitfully deployed to reconsider the classical treatment of entropy in economics by Georgescu-Roegen, if the growth of knowledge is seen as a physical process. Relying on central categories of Peirce's theory of signs, I follow the lines of a naturalistic evolutionary epistemology. In this framework, the three principles of Maximum Entropy (Jaynes), Maximum Power (Lotka) and Maximum Entropy Production can be arranged in a way such that evolution can be conceived as a process that manifests the physical tendency to maximize information generation and information capacity. This implies that the growth of knowledge is the dual of the process of entropy production. This theory matches with recent empirical research showing that economic growth can be tracked by measures of the throughput of useful work, mediated by the thermodynamic efficiency of the conversion of exergy into useful work. -- |
| Keywords: | Peirce,Georgescu-Roegen,maximum entropy,maximum power,natural selection,semeiosis,physical inference devices,economic growth,useful work |
| JEL: | B52 D80 Q57 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fsfmwp:146&r=evo |
| By: | Jeffrey V. Butler (EIEF) |
| Abstract: | In an experiment involving a standard trust game and a costless signalling game, it is demonstrated that economically relevant norm-based behaviors (trust, reciprocity and truth-telling) vary with social identity. The experimental procedure induced two trivial social identities. In one version, a status difference was induced. The results permitted a succinct description of identity effects: subjects held own-group members to a higher standard; and high status subjects held everyone, including themselves, to a higher standard. To illustrate the “high status/high standards” phenomenon, subjects’ “standards” were estimated from a simple identity model for a subset of the data. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eie:wpaper:0817&r=evo |
| By: | Andersson, O.; Argenton, C.; Weibull, J. (Tilburg University, Center for Economic Research) |
| Abstract: | We model a player’s uncertainty about other players’ strategy choices as smooth probability distributions over their strategy sets. We call a strategy profile (strictly) robust to strategic uncertainty if it is the limit, as uncertainty vanishes, of some sequence (all sequences) of strategy profiles, in each of which every player’s strategy is optimal under under his or her uncertainty about the others. We derive general properties of such robustness, and apply the definition to Bertrand competition games and the Nash demand game, games that admit infinitely many Nash equilibria. We show that our robustness criterion selects a unique Nash equilibrium in the Bertrand games, and that this agrees with recent experimental findings. For the Nash demand game, we show that the less uncertain party obtains the bigger share. |
| Keywords: | Nash equilibrium;refinement;strategic uncertainty;price competition;Bertrand competition;bargaining;Nash demand game |
| JEL: | C72 D43 L13 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:201070&r=evo |
| By: | Graafland, J.J. (Tilburg University, Center for Economic Research) |
| Abstract: | Economic research overwhelmingly shows that the utility individuals derive from their income depends on the incomes of others. Theoretical literature has proven that these status effects imply a more egalitarian income policy than in the conventional case, in which people value their income independently from the income of others. This article qualifies this conclusion in three ways. First, this policy implication holds if low income groups are sensitive to status, but not if high income groups are predominantly so. Neither do status effects provide an economic rational for egalitarian income policy if they only pertain to peer groups with similar income levels. Third, if status effects are grounded in vices like envy, jealousy, grudgingness or spite, a moral basis for egalitarian income policy is lacking, because distributive justice cannot be based on perverse preferences. |
| Keywords: | relative income;positional goods;optimal taxation;egalitarian income policy;redistribution;status effects;envy |
| JEL: | D62 H23 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:201073&r=evo |
| By: | John Komlos; Leonard Carlson |
| Abstract: | We analyze the height of Indian scouts hired by the US army after the Civil War. Their average height of 170 cm (67 in.) confirms that American natives were very tall compared to Europeans but were among the shortest segments of the rural populations in the New World. Their height was closer to that of the urban populations who experienced a much heavier disease load than rural populations living in a low population density environment. The trend in their height describes an inverted and elongated “U” shape with some increase in the late antebellum period and a subsequent decline after the Civil War. This implies that in spite of their considerable tribulations the Native American population was able to maintain and to some extent even improve their nutritional status through the Civil War, though harder times followed for those born thereafter. |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:emo:wp2003:1006&r=evo |