Evolutionary economics

Evolutionary Economics (also: evolutionary economics and evolutionary economics ) is arisen in the 1980s research field of economics that deals with the role of knowledge, its change and its limitations for the economy. It builds on earlier theories of businesses to adapt to their environments ( poor A. Alchian ), on theories of the entrepreneur ( Schumpeter ), and on resource- theoretical approaches ( Edith Penrose ), representing the microeconomic equilibrium theory in question.

Position

A shared understanding of the position of evolutionary economics within the economics does not exist, rather, two fundamentally different approaches can be distinguished:

• Built on Joseph Schumpeter direction sees evolutionary economics as a branch of economics that deals with the generated by innovations, technical progress and entrepreneurship processes of transformation of the economy.
• The based on the ideas of Friedrich August von Hayek approach considers evolutionary economics as a fundamental paradigm in competition with neoclassical microeconomics.

While the neoclassical theory of the formation of economic equilibria emanating markets, evolutionary economics economic processes reconstructed analogous to biological evolution: There is no market for, and thus also for any company aspiring to the equilibrium state. A permanent competition between products, services, business forms, and even economic systems ensures that only those competitors may continue to exist, corresponding to the respective environmental requirements and adapt to the constantly changing competitive conditions. Needs to be construed as a form of knowledge.

Basic concepts

Central basic concepts of evolutionary economics are:

• Knowledge: rules that reflect patterns of behavior and relationships that represent knowledge, which coordinates the relationship between a system and its environment. This knowledge can be obtained directly or indirectly and can be true or false. Often it is traditional patterns of behavior that are more or less reflected. Unlike classical economics evolutionary economics defined the basic problem of the economy as a lack of knowledge. Since human perception is subjective, the common knowledge takes new information compared to the total contained in a system by each for an actuator from.

• Actuator: The actuator (or actor ) occurs as a doer In place of the individual within the meaning of homo economicus of classical economics. He has neither the ability to immediately and perfectly rational act, nor does it have absolute knowledge. These three criteria of Homo economicus are not met. From this and from the difficulty to assess complex situations, it follows that in situations of uncertainty seemingly simple rules such as the principle of profit maximization are pointless. So the players are not looking for an optimal solution, they act mostly experienced on the basis of previous experience.

• Population: A certain amount of players forms a population. A distinction is fundamental actors (the person) and derivative actors ( organizations and companies ). Each actor is itself bimodal and combines singular true and false knowledge and wealth. Those actors who have a less successful strategy will be eliminated over time from the population. The decision behavior is always rational, however, because the number of players is growing at a successful strategy.

• Element: Evolution Economically the element is a carrier of knowledge, which in turn may be part of a larger unit. The stored knowledge need not be personal, but can also be stored on data carriers.

• Network: Ordered systems of elements and the acting in them actors form networks through the relationships that maintains each actor to other participants. In a transaction which open relationships to make the configuration of the network dar.

Tradition of thought

The evolutionary economics has been influenced by:

• Friedrich August von Hayek (competition as a discovery procedure )
• Joseph Schumpeter (competition as a process of creative destruction)

Institutional economics

• Thorstein Veblen
• Ronald Coase (The Nature of the Firm)

Of classical political economy

• Thomas Robert Malthus ( Essay on the Principle of Population and The Limits to Growth )
• David Ricardo (theory of comparative advantage )

And contributions by GLS Shackle ( The Nature and Role of Profit ) and Nicholas Georgescu - Roegen. With the publication of the work An Evolutionary Theory of Economic Change by Richard R. Nelson and Sidney G. Winter in 1982, the concept of evolutionary economics has established itself in science.

The basic criteria

Are regarded as central premises

• Historical conditionality of development paths, resources, etc.; thus, there is per se a resource heterogeneity of the actors;
• Imperfect information of the actors; thereby taking into account real uncertainty and the information paradox of Kenneth Arrow.

The evolutionary economic approach negates the model used in the neoclassical theory of Homo economicus as a rational decision maker who always has all the information and on this basis, aiming at the best solution for him. Any decision can result in a whole spectrum of results, there is always an abundance purposeful ways, but which result occurs, is only ex post determine. Absolute best way there is not. Indicator of success is that any profits are realized, not that the maximum profit was achieved. It 's not the profit, it's about the result. The survival of companies is given the complexity of the market to be more dependent on chance or by trial and error than by the conscious choice of an adaptation or survival strategy. The conditions of survival are the companies often do not even realize - so far they resemble organisms that are subject to evolution - however, they can by economists ex post, if also be recognized and explained only a statistical average, the quasi assume the role of biologists.

Evolutionary networks can not be displayed completely because of Performing would themselves have all the relevant data. Science Philosophically this problem is the Quine's theorem comparable. The uniqueness of each actor that a network is a non- integral structure due.