It seems obvious that having multiple wives is a good thing for the fitness of a man. Similarly, having the women in a population monopolised by a small number of men is not good for the fitness of those men who miss out on a mate. In such a society, the large difference in fitness between the haves and the have-nots would be expected to result in strong sexual selection.

In a recent post, I discussed Gianni De Fraja’s paper in which he proposed that sexual selection shaped the nature of conspicuous consumption by men. In his model, conspicuous consumption by men serves as a fitness indicator to women. Low and high quality men signal their differing wealth “honestly” (under certain conditions) as the consumption level of the high quality men is too large a handicap for the low quality men to copy.

Since Thorstein Veblen’s 1899 book Theory of the Leisure Class, the economics profession has taken a somewhat mixed approach to consumption. In areas such signalling theory, Veblen’s argument that conspicuous consumption must be wasteful and expensive to be a reliable signal of wealth is well recognised. Conspicuous consumption has a purpose as a signal. However, the typical economic model is built on the simple concept that more consumption brings more utility.

Humans are inherently risk averse. When offered a coin toss with a reward of $10,000 for heads but a loss of $10,000 for tails, most people would decline. They would likely agree to pay a significant sum to avoid the gamble, despite the expected value of the gamble being zero. When economists describe the preferences of a person, they often build in some form of risk aversion. A risk averse person will always prefer a sum with certainty than a gamble with that expected value.

Links this week: Biology, behaviour and obesity. Eric Crampton on the heritability of political preferences. Polywater (HT: Joe Pickrell). Matt Zwolinski defends the morality of markets. Jason Potts on funding the arts. I’m going to be away in the Malay Archipelago the next two weeks. I’ve scheduled some old posts (with accompanying promotional tweet) from my early blogging days for while I am away, but otherwise, it will be electronic silence from me.

Despite the massive influence of Richard Nelson and Sidney Winter’s An Evolutionary Theory of Economic Change within evolutionary economic circles, the book and the body of work it inspired has had a limited effect through mainstream economics. I believe there are a few reasons for this, but I’ve always thought that this 1996 speech by Paul Krugman to a bunch of evolutionary economists captures one of them: To read the real thing in evolution - to read, say, John Maynard Smith’s Evolution and the Theory of Games, or William Hamilton’s new book of collected papers, Narrow Roads in Gene Land, is a startling experience to someone whose previous idea of evolution comes from magazine articles and popular books.

Richard Nelson and Sidney Winter’s An Evolutionary Theory of Economic Change is the book on which modern “evolutionary economics” is built. Published in 1982, Nelson and Winter took the ideas expressed by Armen Alchian and Joseph Schumpeter decades earlier and presented a direct evolutionary challenge to mainstream approaches to economic growth, technological progress and competition between firms. Nelson and Winter’s conception of firms is a collection of heterogeneous organisations guided by routines, the evolutionary economic equivalent of genes.

Links this week: Gary Marcus takes on John Horgan over the achievements of science. The medicalisation of normality. On neuroeconomics - we need to understand the processes underlying decisions to get microeconomics right. Andrew Gelman on statistical significance: “A serious researcher can easily get statistical significance when nothing is going on at all …. And this can happen without the researcher even trying, just from doing an analysis that seems reasonable for the data at hand…So, given all this, the focus on p=.

From Boyd and Richerson’s The Origin and Evolution of Cultures (references removed): The proposal that human intelligence is at the root of human cooperation is difficult to evaluate because of the ambiguity in what we might mean by intelligence in a comparative context. As the Tasmanian Effect [the loss of their toolkit in a small population] illustrates, individual human intelligence is only a part, and perhaps only a small part, of being able to create complex adaptive behaviors.

In the process of listening to audio versions of some of the less arduous books on my reading list, I have just listened to Richard Thaler and Cass Sunstein’s Nudge. The ideas in the book have been discussed in the public realm often enough that the book didn’t contain any surprises, although the emphasis in the book is a touch different from that in public debate. That difference in emphasis largely relates to the first word of Thaler and Sunstein’s philosophy, “libertarian paternalism”, and how nudges could be used to increase freedom.