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To trust or to control: Informal value transfer systems and computational analysis in institutional economics

Author

Listed:
  • Claudius Graebner

    (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)

  • Wolfram Elsner

    (Institute for Institutional and Innovation Economics, University of Bremen, Germany)

  • Alexander Lascaux

    (Russian Presidential Academy of National Economy and Public Administration, Moscow, Russia)

Abstract

This paper illustrates the usefulness of computational methods for the investigation of institutions. As an example, we use a computational agent-based model to study the role of general trust and social control in informal value transfer systems (ITVS). We find that, how and in which timeline general trust and social control interact in order to make ITVS work, become stable and highly effective. The case shows how computational models may help (1) to operationalize institutional theory and to clarify the functioning of institutions, (2) to test the logical consistency of alternative hypotheses about institutions, and (3) to relate institutionalist theory with other paradigms and to practice an interested pluralism.

Suggested Citation

  • Claudius Graebner & Wolfram Elsner & Alexander Lascaux, 2017. "To trust or to control: Informal value transfer systems and computational analysis in institutional economics," ICAE Working Papers 74, Johannes Kepler University, Institute for Comprehensive Analysis of the Economy.
    • Handle: RePEc:ico:wpaper:74
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    References listed on IDEAS

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    5. Tesfatsion, Leigh, 2017. "Modeling Economic Systems as Locally-Constructive Sequential Games," ISU General Staff Papers 201704300700001022, Iowa State University, Department of Economics.
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    Keywords

    agent-based computational economics; evolutionary-institutional economics; informal value transfer systems; general trust; social control;
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