What is specific about evolutionary economics?

Abstract

Ever since an "evolutionary" perspective on the economy has been suggested, there have been differing, and partly incommensurable, views on what specifically this means. By working out where the differences lie and what motivates them, this paper identifies four major approaches to evolutionary economics. The differences between them can be traced back to opposite positions regarding the basic assumptions about reality and the proper conceptualization of evolution. The same differences can also be found in evolutionary game theory. Achievements of the major approaches to evolutionary economics and their prospects for future research are assessed by means of a peer survey.

The Emergence of the ERP Software Market between Product Innovation and Market Shaping

“…Hence, this methodological innovation enables to measure the relationship between product innovation and market shaping in a gradual way, and can be used to explore the question of whether the market success has been a necessary, a strong, or a weak consequence of the product innovation. This way of a gradual measurement of causality regarding the relation between product innovation and market shaping is an innovative step to evaluate economic change and pioneer market creation from an evolutionary point of view, especially by updating the basic variation-selection-retention scheme with a Lamarckian perspective, and framing the process of product innovation and market-shaping from a monistic ontological viewpoint [37] by providing the necessary link between change in nature and change in economy through the theory of mind of Hayek [26]. As it was found out by calculating the prograde degree of causality, the relation between new technological knowledge (such as a product innovation) and the successful market shaping (the market success of this product innovation) does not have to be a necessity relation.…”

“…These different (neo-)Schumpeterian models seem to neglect an important dimension of the market process; imagination, leadership and the entrepreneurial input focusing on business conceptions [28]. A further shortcoming of the neo-Schumpeterian scope of research is to take a dualistic ontological stance on the relation between change in nature and change in economy [37]. This seems to be a problematic view, since knowledge generation relevant for economic change starts in the human mind [6,9,10,27] and through the involvement of human cognition, an interdependency between economy and nature can be established, as the latest attempts to associate the psychologic work of Hayek with his economic theories also demonstrate [6,10,38].…”

Law of the jungle: firm survival and price dynamics in evolutionary markets

“…3.3 is that a little manipulation provides us with a micro-founded replicator dynamic for economic phenomena. Replicator dynamics constitute a formalisation of the three step Darwinian process of evolution whereby variety is generated, that variety is resolved through selection of the "fittest" species, and then that species retained by natural selection (Witt 2008;Hodgson 2004;Dawkins 1976). Again by applying a manipulative tautology to Eq.…”

“…Before proceeding further, I should acknowledge that there is debate in evolutionary economics around whether evolution is an analogy for economic processes or an inherently economic process (Witt 2008), though this is now largely settled in favour of the latter (Vromen 2012). Much like Joseph Schumpeter (Hodgson 1997) I hold to the view that the economy is and "is like" the economy first and foremost, any analogy is incidental, one of those iso-morphic laws which complex systems tend to share (von Bertalanffy 1950).…”

The Ecology of Financial Markets

“…The leader of alternative economic thought at the time, Veblen criticized the neoclassical paradigm by pointing out that uncertainty, complexity, and emergence are inherent properties of economic reality. There are at least four distinctive evolutionary approaches in economics (Witt, 2008). First, probably the most prominent evolutionary economist, Joseph Schumpeter (1912Schumpeter ( /1934 held that the concept of natural evolution is inappropriate to deal with the fast progress of capitalist societies.…”