Evolutionary Thinking in Microeconomic Models: Prestige Bias and Market Bubbles

Adrian Viliami Bell

PLOS ONE, 2013, vol. 8, issue 3, 1-5

Abstract: Evolutionary models broadly support a number of social learning strategies likely important in economic behavior. Using a simple model of price dynamics, I show how prestige bias, or copying of famed (and likely successful) individuals, influences price equilibria and investor disposition in a way that exacerbates or creates market bubbles. I discuss how integrating the social learning and demographic forces important in cultural evolution with economic models provides a fruitful line of inquiry into real-world behavior.

Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0059805

DOI: 10.1371/journal.pone.0059805

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