Q: How many economists does it take to screw in a light bulb?
A: Zero. The invisible hand will do it.

Making jokes about economics is fun and easy. The field’s nickname is the ‘dismal science’. Type ‘economic jokes’ into Google and you will see 19.5 million hits, far more than other fields, and almost as many as for political jokes. Economics is the field that people love to hate.

Improving economics is much harder than making jokes. In a special issue of the Journal of Economic Behavior and Organization, more than two dozen scholars from around the world have written 13 articles with the important and difficult goal of making economics better.

The title of the special issue is “Evolution as a General Theoretical Framework for Economics and Public Policy.” This is a relatively novel approach and deserves some discussion.

The standard economic paradigm is the neoclassical model. People know what makes them happy and are good at making decisions to accomplish their goals. Furthermore, neoclassical theory has been used to support free market policies by arguing that self-interested, rational actors lead to ‘optimal’ social outcomes, when optimal is defined in a particular way.

“People are rational and greed is good” would be a lay summary of neoclassical economics.

Just reading that sentence probably makes many people’s blood boil. The list of critics of neoclassical economic is long and distinguished. Within the citadels of economic power, however, only one critique has made significant inroads. This successful critique is the behavioral economic field founded by Daniel Kahneman, Amos Tversky, and most forcefully advanced by Professor Richard Thaler of the University of Chicago.

Professor Thaler sums up behavioral economics by saying that people are ‘nicer and dumber’ than economists assume.

The authors of the special issue of JEBO believe that evolutionary theory is required to improve economics. In 1973, the famous biologist Theodosius Dobzhansky, wrote, “Seen in the light of evolution, biology is, perhaps, intellectually the most satisfying and inspiring science. Without that light it becomes a pile of sundry facts-some of them interesting or curious but making no meaningful picture as a whole.”

Paraphrasing Dobzhanksy, we, the authors of these articles on economics and evolution, argue that economics without evolution is a pile of sundry facts-some of them interesting or curious but making no meaningful picture as a whole.

Furthermore, these articles go beyond criticism to specific areas. In many cases, the authors have devoted decades to these topics, and are recognized global leaders. The techniques range from theoretical to experimental to simulation. The species covered include humans, non-human primates, and many other animals.

In order to make the issue accessible, This View of Life is pleased to provide short summaries of each article that link to the full-length articles, which the Evolution Institute has paid to make free online for a period of six months.

We welcome your interest and your comments.


Read summaries of the articles:

1) Evolution As A General Theoretical Framework For Economics And Public Policy

2) Economic Cosmology and the Evolutionary Challenge

3) Generalizing The Core Design Principles For The Efficacy of Groups

4) Phylogenetic Footprints in Organizational Behavior

5) A Naturalistic Theory of Economic Organization

6) The Evolution of Trust

7) The Evolution Of Self-Organization In A Small, Complex, Economy

8) The Evolution of Hyperbolic Discounting: Implications for Truly Social Valuation of the Future

9) Toward A Neo-Darwinian Synthesis Of Neoclassical And Behavioral Economics

10) Darwin’s Invisible Hand: Market Competition, Evolution And The Firm

11) The Role Of Writing And Recordkeeping In The Cultural Evolution Of Human Cooperation

12) Prevention Science, The Tobacco Industry and Market Ideology

Published On: July 3, 2013

Terence Burnham

Terence Burnham

Terry Burnham is an economist who studies the biological and evolutionary basis of human behavior. He is Associate Professor at Chapman University. He has a Ph.D. in Business Economics from Harvard University, a Masters from the MIT Sloan School with a concentration in finance. HIs undergraduate degree is in biophysics from the University of Michigan.Terry was a professor at the Harvard Kennedy School, the University of Michigan, and the Harvard Business School. His non-academic experiences include working for Goldman, Sachs & Co., being the chief financial officer for Progenics Pharmaceuticals and being the director of Portfolio Management for Acadian Asset Management, a quantitative equity manager. Visit his blog.

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