Evolutionary Economics and Household Behavior
17 Pages Posted: 19 Aug 2014
Date Written: August 16, 2014
This paper provides an introduction to the field of evolutionary economics with emphasis on the evolutionary theory of household behavior. It shows that the goal of evolutionary economics is to improve upon neoclassical economics by incorporating more realistic and empirically grounded behavioral assumptions and technological innovation and that the goal of the evolutionary theory of household behavior is to improve upon the neoclassical theory of household behavior by replacing the neoclassical assumption of selfish utility maximization with bounded rationality and satisficing and by incorporating the reaction of households to the introduction of new goods and services. The paper concludes with a brief discussion of loss aversion and self-interest vs. altruism.
Keywords: altruism; behavioral economics; bequest motives; consumption behavior; evolution; evolutionary biology; evolutionary economics; household behavior; loss aversion; neoclassical economics; selfishness; self-interest; technology; technological innovation; technological progress; utility maximization
JEL Classification: A12, B15, B25, B52, D11, D91, E21, O31, O33
Suggested Citation: Suggested Citation