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The persistence of inferior cultural-institutional conventions

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  • Marianna Belloc
  • Samuel Bowles
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    Abstract

    Our theory of cultural-institutional persistence and innovation is based on uncoordinated updating of individual social norms and contracts, so that both culture and institutions are endogenous. We explain why Pareto-dominated cultural-institutional configurations may persist over long periods and how transitions may nonetheless occur. Unlike models in which elites may impose inferior institutions or cultures as a self-interested distributional strategies, in our model, the exercise of elite power plays no role in either persistence or innovation, and transitions occur endogenously. We show that persistence will be the greater the more inferior is the Pareto-dominated configuration and the more rational and individualistic is the population.

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    Bibliographic Info

    Paper provided by University of Rome La Sapienza, Department of Public Economics in its series Working Papers with number 157.

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    Length: 16
    Date of creation: Nov 2012
    Date of revision:
    Handle: RePEc:sap:wpaper:wp157

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    Related research

    Keywords: endogenous institutions; endogenous social norms; cultural-institutional persistence; evolutionary game theory;

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    1. Daron Acemoglu & Georgy Egorov & Konstantin Sonin, 2012. "Dynamics and Stability of Constitutions, Coalitions, and Clubs," American Economic Review, American Economic Association, vol. 102(4), pages 1446-76, June.
    2. Krusell, Per & Rios-Rull, Jose-Victor, 1996. "Vested Interests in a Positive Theory of Stagnation and Growth," Review of Economic Studies, Wiley Blackwell, vol. 63(2), pages 301-29, April.
    3. Binmore, Ken & Samuelson, Larry & Young, Peyton, 2003. "Equilibrium selection in bargaining models," Games and Economic Behavior, Elsevier, vol. 45(2), pages 296-328, November.
    4. Kenneth L. Sokoloff & Stanley L. Engerman, 2000. "Institutions, Factor Endowments, and Paths of Development in the New World," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 217-232, Summer.
    5. Acemoglu, Daron, 2003. "Why not a political Coase theorem? Social conflict, commitment, and politics," Journal of Comparative Economics, Elsevier, vol. 31(4), pages 620-652, December.
    6. Blume, Lawrence E., 2003. "How noise matters," Games and Economic Behavior, Elsevier, vol. 44(2), pages 251-271, August.
    7. Greif, Avner, 1994. "Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 912-50, October.
    8. Gregory Clark, 2007. "Introduction to A Farewell to Alms: A Brief Economic History of the World
      [A Farewell to Alms: A Brief Economic History of the World]
      ," Introductory Chapters, Princeton University Press.
    9. Nathan Nunn, 2012. "Culture and the Historical Process," NBER Working Papers 17869, National Bureau of Economic Research, Inc.
    10. Iyengar, G. & Kets, W. & Sethi, R. & Bowles, S., 2008. "Inequality and Network Structure," Discussion Paper 2008-76, Tilburg University, Center for Economic Research.
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