IDEAS home Printed from https://ideas.repec.org/a/aea/aejmic/v3y2011i3p210-31.html
   My bibliography  Save this article

Kludged

Author

Listed:
  • Jeffrey C. Ely

Abstract

Is there reason to believe that our brains have evolved to make efficient decisions so that the details of the internal process are irrelevant? I develop a model which illustrates a limitation of adaptive processes: improvements tend to come in the form of kludges. A kludge is a marginal adaptation that compensates for, but does not eliminate, fundamental design inefficiencies. When kludges accumulate, the result can be perpetually suboptimal behavior even in a model of evolution in which arbitrarily large innovations occur infinitely, often with probability 1. (JEL D03, D87)

Suggested Citation

  • Jeffrey C. Ely, 2011. "Kludged," American Economic Journal: Microeconomics, American Economic Association, vol. 3(3), pages 210-231, August.
    • Handle: RePEc:aea:aejmic:v:3:y:2011:i:3:p:210-31
    Note: DOI: 10.1257/mic.3.3.210
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/mic.3.3.210
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Unknown, 2006. "Editorial Information," Journal of Food Distribution Research, Food Distribution Research Society, vol. 37(1), pages 1-1, March.
    2. Friedman, Milton, 1966. "Essays in Positive Economics," University of Chicago Press Economics Books, University of Chicago Press, number 9780226264035, September.
    3. , & , M., 2006. "Information, evolution and utility," Theoretical Economics, Econometric Society, vol. 1(1), pages 119-142, March.
    4. Arthur J. Robson, 2001. "Why Would Nature Give Individuals Utility Functions?," Journal of Political Economy, University of Chicago Press, vol. 109(4), pages 900-929, August.
    5. Sandholm, William H. & Pauzner, Ady, 1998. "Evolution, Population Growth, and History Dependence," Games and Economic Behavior, Elsevier, vol. 22(1), pages 84-120, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Frenkel, Sivan & Heller, Yuval & Teper, Roee, 2012. "Endowment as a blessing," MPRA Paper 39430, University Library of Munich, Germany, revised 30 Apr 2012.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Olivier Gossner & Christoph Kuzmics, 2019. "Preferences Under Ignorance," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 60(1), pages 241-257, February.
    2. Steiner, Jakub & Stewart, Colin, 2014. "Perceiving Prospects Properly," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-39, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. De Fraja, Gianni, 2009. "The origin of utility: Sexual selection and conspicuous consumption," Journal of Economic Behavior & Organization, Elsevier, vol. 72(1), pages 51-69, October.
    4. Jakub Steiner & Colin Stewart, 2016. "Perceiving Prospects Properly," American Economic Review, American Economic Association, vol. 106(7), pages 1601-1631, July.
    5. Adriani, Fabrizio & Sonderegger, Silvia, 2009. "Trust, Introspection, and Market Participation: an Evolutionary Approach," MPRA Paper 16110, University Library of Munich, Germany.
    6. David Jiménez-Gómez, 2018. "The Evolution of Self-Control in the Brain," Working Papers. Serie AD 2018-04, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    7. Fabrizio Adriani & Silvia Sonderegger, 2014. "Evolution of similarity judgements in intertemporal choice," Discussion Papers 2014-06, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    8. Jack Vromen, 2007. "Neuroeconomics as a Natural Extension of Bioeconomics: The Shifting Scope of Standard Economic Theory," Journal of Bioeconomics, Springer, vol. 9(2), pages 145-167, August.
    9. Linda S Goldberg, 2009. "Understanding Banking Sector Globalization," IMF Staff Papers, Palgrave Macmillan, vol. 56(1), pages 171-197, April.
    10. Annarita Colasante & Simone Alfarano & Eva Camacho-Cuena, 2020. "Heuristic Switching Model and Exploration-Exploitation Algorithm to Describe Long-Run Expectations in LtFEs: a Comparison," Computational Economics, Springer;Society for Computational Economics, vol. 56(3), pages 623-658, October.
    11. Carlos A. Rodríguez, 2018. "Fuentes de las fluctuaciones macroeconómicas en Puerto Rico\Sources of macroeconomic fluctuations in Puerto Rico," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 33(2), pages 219-252.
    12. Moritz Hetzer & Didier Sornette, 2013. "An Evolutionary Model of Cooperation, Fairness and Altruistic Punishment in Public Good Games," PLOS ONE, Public Library of Science, vol. 8(11), pages 1-13, November.
    13. Jesus Munoz, 2011. "Orthodox versus Heterodox (Minskyan) Perspectives of Financial Crises: Explosion in the 1990s versus Implosion in the 2000s," Economics Working Paper Archive wp_695, Levy Economics Institute.
    14. Seif I. Tag El-Din, 1992. "Debt and Equity in a Primary Financial Market: A Theory with Islamic Implications سندات الدين والأسهم في سوق مالية أولية ـ نظريتها ودلالاتها الإسلامية," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 4(1), pages 3-34, January.
    15. Geoffrey M. Hodgson, 2003. "The Mystery of the Routine. The Darwinian Destiny of An Evolutionary Theory of Economic Change," Revue économique, Presses de Sciences-Po, vol. 54(2), pages 355-384.
    16. Olivier Gossner & Jakub Steiner, 2016. "Optimal Illusion of Control and Related Perception Biases," CERGE-EI Working Papers wp571, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    17. Aldo Rustichini, 2009. "Is There a Method of Neuroeconomics?," American Economic Journal: Microeconomics, American Economic Association, vol. 1(2), pages 48-59, August.
    18. Jan‐Erik Lane & Reinert Maeland, 2006. "International Organisation as Coordination in N‐Person Games," Political Studies, Political Studies Association, vol. 54(1), pages 185-215, March.
    19. Ingela Alger & Donald Cox, 2013. "The evolution of altruistic preferences: mothers versus fathers," Review of Economics of the Household, Springer, vol. 11(3), pages 421-446, September.
    20. Peter A. F. Fraser‐Mackenzie & Tiejun Ma & Ming‐Chien Sung & Johnnie E. V. Johnson, 2019. "Let's Call it Quits: Break‐Even Effects in the Decision to Stop Taking Risks," Risk Analysis, John Wiley & Sons, vol. 39(7), pages 1560-1581, July.

    More about this item

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D87 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Neuroeconomics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejmic:v:3:y:2011:i:3:p:210-31. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.