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Evolutionary Drift in Preference and Equilibrium Selection

Evolutionary Drift in Preference and Equilibrium Selection Abstract This paper studies the situation where myopic players repeatedly face a society with two actions where their common fitness exhibits economies of scale. Both states in which all players choose the same actions are equilibria. In each period, players adjust their actions based on their preferences, which are in turn shaped by natural selection. The preferences of the players need not match the underlying fitness. When rare mutations are introduced into the evolutionary process, their preferences may drift without affecting equilibrium behaviour. This paper shows that these drifts influence the results of equilibrium selection. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The Japanese Economic Review Springer Journals

Evolutionary Drift in Preference and Equilibrium Selection

Yamamori, Tetsuo
The Japanese Economic Review , Volume 60 (3): 14 – Sep 1, 2009
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References (15)

Publisher
Springer Journals
Copyright
2008 Japanese Economic Association
ISSN
1352-4739
eISSN
1468-5876
DOI
10.1111/j.1468-5876.2008.00453.x
Publisher site
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Abstract

Abstract This paper studies the situation where myopic players repeatedly face a society with two actions where their common fitness exhibits economies of scale. Both states in which all players choose the same actions are equilibria. In each period, players adjust their actions based on their preferences, which are in turn shaped by natural selection. The preferences of the players need not match the underlying fitness. When rare mutations are introduced into the evolutionary process, their preferences may drift without affecting equilibrium behaviour. This paper shows that these drifts influence the results of equilibrium selection.

Journal

The Japanese Economic Review – Springer Journals

Published: Sep 1, 2009

Keywords: economics, general; microeconomics; macroeconomics/monetary economics//financial economics; econometrics; development economics; economic history

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