Saver Types: An Evolutionary-Adaptive Approach

Gergely Varga () and János Vincze
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Gergely Varga: Department of Macroeconomics, Corvinus University of Budapest, Hungary
János Vincze: Corvinus University of Budapest, Hungary

Society and Economy, 2019, vol. 41, issue 2, 263-287

Abstract: We set up an agent-based macro-model that focuses on the consumption-saving decision. Agents do not maximize utility, but their behaviour features certain “rational” aspects of human choice based on the idea of ecological rationality. Three qualitatively different saving strategies are defi ned: 1, buffer stock saving (prudent and forward looking); 2, permanent income saving (forward looking without prudence); and 3, myopic saving (caring only about immediate consumption). It is found that prudent saving behaviour becomes prevalent when the selection pressure is very high, but an economy comprising only prudent households tends to accumulate capital in excess of what is implied by the Golden Rule. Lowering the intensity of evolutionary forces results in more diversity in saver types, and, somewhat puzzlingly, may be socially beneficial in some sense.

Keywords: agent-based macro-model; bounded rationality; evolutionary learning; saving types (search for similar items in EconPapers)
JEL-codes: C69 E21 (search for similar items in EconPapers)
Date: 2019
Note: We are grateful for valuable comments by András Simonovits and István Kónya. This study was funded by the grant OTKA K 108 658 of the Hungarian government.
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