Search results

This article describes an experiment in a Kydland/Prescott type of environment with cheap talk. Individual evolutionary learning (IEL) acts as a policy maker that makes inflation announcements and decides on actual inflation rates. IEL evolves a set of strategies based on the evaluation of their counterfactual payoffs measured in terms of disutility of inflation and unemployment. Two types of private agents make inflation forecasts. Type 1 agents are automated and they set their forecast equal to the announced inflation rate. Type 2 agents are human subjects who submit their inflation forecast and are rewarded based on their forecast error. The fraction of each type evolves over time based on their performance. Experimental economies result in outcomes that are better than the Nash equilibrium. This article is the first to use an automated policy maker that changes and adapts its rules over time in response to the environment in which human subjects make choices.

This article discusses the methodology of using laboratory methods to address macroeconomic questions. It also provides summaries of the articles in this volume.

Interpreting venture creation as a process of learning allows potential entrepreneurs to help themselves, and develop the skills and competences they required for business. The effectiveness of a learning-based approach to enterprise education is explored here. This study examines changing perceptions and performances of business students as they complete a new venture creation module. In this course, students are invited to interpret the start-up process as a process of learning, using an evolutionary metaphor. Several key findings were revealed. First, the evolutionary learning approach increased the self-efficacy of participants, as their self-belief and confidence in their ideas and abilities increased over the course of the module. This increase was even more pronounced within a sub-group who started their businesses within six months of completion of the course. Second, by adopting the ‘learning to evolve’ approach, participants increasingly focused changes made to their ideas on marketing-related issues. The more the individual focused on marketing as a source of change, the better the improvement in quality of the idea. This research has implications for enterprise educators and practicing entrepreneurs. When one shifts the focus of attention to the external world, and when changes are driven by signals from that external world, the quality of emerging opportunities is enhanced. Moreover, self-efficacy increases as nascent entrepreneurs gain confidence and self-belief both in their ideas, and the skills needed to make them happen. The shift in perspective towards the external market is the key driver in triggering the entrepreneurial process. The approach thus promotes the notion that the entrepreneurship option is open to all who can ‘learn to evolve’.

There are the interesting words of Myrdal in respect of the universality and commonness of what a scientific problem means:From then on more definitely I came to see that in reality there are no economic, sociological, psychological problems, but just problems and they are all mixed and composite. In research the only permissible demarcation is between relevant and irrelevant conditions. The problems are regularly also political and have moreover to be seen in historical perspective. (Myrdal, 1979, p. 106)

A characteristic feature of economic development is the ever-changing structure of consumption patterns. Reducing the explanation of this phenomenon to changing prices, ultimately caused by changes in the availability of goods (or characteristics), would neglect a major force driving this change, namely, the variation of consumer wants and consumer knowledge. The present paper sketches an evolutionary framework for the analysis of consumer behaviour that takes account of these features.

For this purpose, Carl Menger's theory of goods is taken as starting point. Whereas economists after the ‘marginal revolution’ were almost exclusively concerned with the determinants of exchange value and developing price theory, Menger puts as much emphasis on user value as on exchange value. Focusing on how user value changes establishes a connection between Menger's 19th-century theory of goods and 20th-century learning theories. The problem of how to get from individual learning processes to aggregate consumption patterns is approached by recollecting the genetic underpinnings of human learning and its dependence on certain physical and social conditions. Taking into account that these conditions are also dynamic, we are able to interpret collective learning processes as historical events, which renders them useable for the analysis of economic change.

The methodological individualism and subjectivism of the Austrian tradition in economics is often associated with a methodological dualism, i.e. the claim that the nature of its subject matter, namely purposeful and intentional human action, requires economics to adopt a methodology that is fundamentally different from the causal explanatory approach of the natural sciences. This paper critically examines this claim and advocates an alternative, explicitly naturalistic and empiricist outlook at human action, exemplified, in particular, by the research program of evolutionary psychology. It is argued that, within the Austrian tradition, a decidedly naturalistic approach to subjectivism can be found in F. A. Hayek’s work.

This chapter aims to identify the main determinants that define the architectural properties of network emergence and significantly influence the dynamics underlying network evolution in time. The identification and analysis of these determinants, as well as the dynamic processes tied to them, allows to appreciate the competitive bases and consequences of network morphology. To this purpose, using a complex systems perspective as an integrative conceptual approach, we represent networks as complex dynamic systems of knowledge and capabilities. We perform a comparative in-depth analysis of the processes underlying the emergence and evolution of STMicroelectronic's global network and of Toyota's supplier network in the US so as to allow an elucidatory empirical assessment of the theoretical representation elaborated in the article.

Despite the growing importance of young, entrepreneurial ventures in modern economic systems, many such ventures fail quite early in their lifecycles. While both evolutionary theory and organizational learning theory yield important insights for the literature on young venture survival, questions remain as to why ventures facing similar environments experience differential rates of survival. In response, I propose a theory of entrepreneurial agency – defined as the emergence and/or transformation of firms, markets, industries governed by the evolving interaction of temporally situated, intentional strategic action with a malleable external environment – to complement prevailing viewpoints on the causes of young venture survival. My central thesis in this chapter is that to develop more comprehensive explanations of differential survival rates, a theory of entrepreneurial agency – illuminating the transformative potential of entrepreneurial action – is necessary to complement evolutionary perspectives in the literature on firm survival. With this objective in mind, I construct a theoretical model linking diverse perspectives on the duality of human agency and theories of environmental selection, and offer several theoretical and empirical suggestions to guide future research.

The quality of students' relationships with their teachers plays a significant role in their success in school. Social and emotional learning (SEL) curriculums show great promise for supporting student development. However, quality implementation requires that teachers recognize and understand how their behavior and interactions with students impact the development of these skills. The Prosocial Classroom Model proposes that teacher social and emotional competencies (SECs) play a critical role in creating and maintaining a classroom where everyone feels safe, connected, and engaged in learning. In this chapter, we extend the understanding of SEC to include leadership styles as defined by evolutionary motivational systems theory. We argue that a critical dimension of effective SEL instruction and teacher SEC is effective leadership that skillfully applies an understanding of the social and emotional dimensions of classroom interactions that promote motivation, engagement, and learning. Implications for educational theory, policy and practice, and research are discussed.