Understanding Economic Change: Advances in Evolutionary Economics

✍ Scribed by Ulrich Witt (editor), Andreas Chai (editor)

• Publisher: Cambridge University Press
• Year: 2019
• Tongue: English
• Leaves: 412
• Category: Library

✦ Synopsis

Although the economy has always been changing, ever more innovations now seem to accelerate the transformation process. Are there any laws governing the incessant global change? Does it accord with our intentions and desires and make us happier? Do our institutions and our democracies cope with the challenges? How does economic theory explain what is going on? In this volume, experts in the field discuss the advances that evolutionary economics has made in exploring questions like these. The broad range of topics include a review of the development of the field: its conceptual and methodological characteristics are outlined; problems posed by macroeconomic evolution and the institutional challenges are highlighted; and, last but not least, the implications of the evolution of the economy for wellbeing and sustainability are addressed. Taken together, the contributions demonstrate the potential of an evolutionary paradigm for making sense of economic change and for assessing its consequences.

✦ Table of Contents

Cover
Half Title
Title page
Imprints page
Contents
List of Figures
List of Tables
List of Contributors
Part I Introduction
1 Evolutionary Economics: Taking Stock of Its Progress and Emerging Challenges
Introduction
On the Difficulties of Recognizing and Explaining Economic Evolution
Three Waves of Thinking about Economic Evolution: A Brief Outline
Advancing Evolutionary Economics: Methodology, Theory, and Normative Judgement
Conclusion
References
Part II Conceptual and Methodological Problems
2 Missed Connections and Opportunities Forgone: A Counterfactual History of Twentieth-Century Economics
Introduction
The Creation of Knowledge
Knowledge and Organization
Equilibrium and Equilibration
Marshall
A Counterfactual Theory of the Firm
Institutions and Knowledge
A Counterfactual Macroeconomics
Human Knowledge and the Human Mind
Conclusion
References
3 Science, Technology, and Knowledge: What Economic Historians Can Learn from an Evolutionary Approach
Introduction
A Few Definitions
Evolutionary Models and the Economic History of Technology
Evolution and Historical Issues
Knowledge and Technique
Innovation and Inertia
Conclusions
References
4 Generalized Darwinism in Evolutionary Economics: The Devil Is in the Detail
Introduction
Hodgson and Knudsen’s Case for Generalized Darwinism
Different Clusters of Ontological Issues
Noncausal Explanations of Causal Processes
What More Is Needed Than Generalized Darwinism to Arrive at Causal Explanations?
Other Optional Routes Not Taken
Are Replication and Interaction Two Separate Processes in Nonbiological Evolution?
Why Replication Is a Nonstarter in Cultural Transmission in the First Place
Selection Type Theories as an Even More General Version of Darwinism
The Devil Is in the Details
Conclusions
References
Part III Perspectives on Evolutionary Macroeconomics
5 Macroeconomic Evolution: Long-Run Development and Short-Run Policy
Introduction
The Theory of Macroeconomic Evolution
The Classical Story
Internal Diseconomies
Infrastructure and Viability
Growth and Decline through Replication and Merging
Growth and Decline through Integration and Disintegration
Continuous Productivity Advance and the Ultimate Population Bound
The “Grand” Dynamics
Fact in Economic Theory and Economic Development in Fact
The Great Stages
Hunting and Food Collecting and Settled Agriculture
Settled Agriculture and City States
Trading Empires, the Industrial Nation-State, and the Global Information Economy
The Lessons
The Transition
The American Decline
Are There Limits For Growth?
Conclusion
References
6 Evolutionary Micro-Founded Technical Change and the Kaldor-Verdoorn Law: Estimates from an Artificial World
Introduction
An Evolutionary Model of Technical Change
Defining the Population: Firms’ Characteristics
Defining Firms’ Performance: The Selection Mechanisms
Changes in Firms’ Characteristics: The Mutation Mechanisms
Simulation Results
Main Model Dynamics and Kaldor’s Stylized Facts
Technological Parameters and Productivity Gains
Evolutionary Micro-Dynamics and the Kaldor-Verdoorn Law
Concluding Remarks
References
Part IV Advances in Explaining and Assessing Institutional Evolution
7 Democracy, Rationality and Religion
Introduction
The Psychology of Individuals
Behavioral
Cognitive
Evolutionary
The Evolution of Human Psychology
Episodic Culture
Mimetic Culture
Mythic Culture
Theoretic Culture
Superstition and Religion
Religion and Causality
Religion and Death
Religion and Morality
Religion as an Exchange Relationship
Summary of Local Religions
Universal Religions
Contrasting the Theoretical Systems of Modern and Traditional Societies
The “Triumph” of the Theoretic over the Mythic Culture
State and Religion: The Sumerian State
The State without Religion: The Greek City-State
Importance of Rational Thought
The Invention of Democracy
Appraisal
The Rediscovery of Reasoning
Citizenship and Democracy
Religion and Democracy
Conclusions
References
8 On the Evolution of Organisational Governance: Divided Governance and Survival in the Long Run
Introduction
The Origins, Governance, and Convergence of Organisational Rules
The Emergence of Rules for Conditional Rewards and Punishments
Composite Reward and Punishment Systems
Assembling the Best Team
The Evolution and (Partial) Convergence of Internal Reward Systems
Why Durable Organisations Need and Have a Government
Formeteur Rule, the Need for Advice, and the Dictator’s Dilemma
Delegating Policy-Making Authority
On the Value Added by Flexible Forms of Governance
Internal and External Markets for Authority
Constitutional Gains to Trade
The King and Council Template Can Be Used to Reduce Unproductive Conflict
Succession and the King and Council Template
The Long-Term Evolution of Organisational Governance
Conclusions
References
9 Strategic Interaction and Externalities: FD-Games and Pollution
Introduction
The Bathroom Game
Strategies
Rewards
Threats and Equilibria
Dealing with Criticism on Folk Theorems
Conclusions
References
10 Fairness in Urban Land Use: An Evolutionary Contribution to Law and Economics
Introduction
Urban Land Use Conflicts: The Orthodox View
The Coasean Perspective
What’s a “Fair” Compensation?
Theoretical and Practical Gaps in the Coasean Perspective
Limits of Coasean Bargaining
A Brief Evolutionary Account of “Fairness” Norms
Binmore on the Evolution of Fairness Norms
Some Normative Implications
The Incorporation of Fairness Criteria
Two Rawlsian Fairness Criteria …
… And Their Deliberative Generation
Concluding Remarks
References
Part V Evolutionary Perspectives on Welfare and Sustainability
11 As Innovations Drive Economic Change, Do They Also Improve Our Welfare?
Introduction
How to Measure Welfare Effects of Innovations
Whose Welfare Will Be Affected by Innovations and How?
Endogenous Change of Welfare Assessments of Innovations
Conclusion
References
12 Sustainable Consumption Patterns and the Malleability of Consumer Preferences: An Evolutionary Perspective
Introduction
Endogenous Preferences and Ecological Economics
An Evolutionary Theory of Consumer Specialisation
Specialisation and the Malleability of Preferences
Markets as Tools
Conclusion
References
Index