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Evolution-Based Approaches in Economics and Evolutionary Loss of Information

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  • Heinrich, Torsten

Abstract

Evolutionary economics provides a self-organizing stabilizing mechanism without relying on mechanic equilibria. However, there are substantial differences between the genetic evolutionary biology, and the evolution of institutions, firms, routines or strategies in economics. Most importantly, there is no genetic codification and no sexual reproduction in economic evolution, and the involved agents can interfere consciously and purposefully. This entails a general lack of fixation and perhaps the quick loss of information through a Muller's ratchet like mechanism. The present contribution discusses the analogy of evolution in biology and economics and considers potential problems resulting in evolutionary models in economics.

Suggested Citation

  • Heinrich, Torsten, 2015. "Evolution-Based Approaches in Economics and Evolutionary Loss of Information," MPRA Paper 68384, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:68384
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    File URL: https://mpra.ub.uni-muenchen.de/68384/2/MPRA_paper_68384.pdf
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    References listed on IDEAS

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    1. Wolfram Elsner, 2013. "State and future of the ‘citadel’ and of the heterodoxies in economics: challenges and dangers, convergences and cooperation," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 10(3), pages 286—298-2, December.
    2. Cordes, Christian & Richerson, Peter & Mcelreath, Richard & Strimling, Pontus, 2011. "How does opportunistic behavior influence firm size? An evolutionary approach to organizational behavior," Journal of Institutional Economics, Cambridge University Press, vol. 7(01), pages 1-21, March.
    3. Silverberg, Gerald & Dosi, Giovanni & Orsenigo, Luigi, 1988. "Innovation, Diversity and Diffusion: A Self-organisation Model," Economic Journal, Royal Economic Society, vol. 98(393), pages 1032-1054, December.
    4. Lorenz, Hans-Walter, 1987. "Strange attractors in a multisector business cycle model," Journal of Economic Behavior & Organization, Elsevier, vol. 8(3), pages 397-411, September.
    5. Wolfram Elsner, 2012. "The Theory of Institutional Change Revisited: The Institutional Dichotomy, Its Dynamic, and Its Policy Implications in a More Formal Analysis," Journal of Economic Issues, Taylor & Francis Journals, vol. 46(1), pages 1-44.
    6. Steve Keen, 1995. "Finance and Economic Breakdown: Modeling Minsky’s “Financial Instability Hypothesis”," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 17(4), pages 607-635, July.
    7. Karolina Safarzyńska & Jeroen Bergh, 2010. "Evolutionary models in economics: a survey of methods and building blocks," Journal of Evolutionary Economics, Springer, vol. 20(3), pages 329-373, June.
    8. Thorstein Veblen, 1898. "Why is Economics Not an Evolutionary Science?," The Quarterly Journal of Economics, Oxford University Press, vol. 12(4), pages 373-397.
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    Citations

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    Cited by:

    1. Heinrich, Torsten, 2016. "The Narrow and the Broad Approach to Evolutionary Modeling in Economics," MPRA Paper 75797, University Library of Munich, Germany.
    2. A. Madureira & F. Hartog & N. Baken, 2016. "A holonic framework to understand and apply information processes in evolutionary economics: survey and proposal," Netnomics, Springer, vol. 17(2), pages 157-190, September.

    More about this item

    Keywords

    evolutionary economics; evolutionary loss of information; error catastrophe; resilience;

    JEL classification:

    • B25 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Historical; Institutional; Evolutionary; Austrian; Stockholm School
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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