Essays in Honour of Geoffrey M. Hodgson
Edited by Francesca Gagliardi and David Gindis
Chapter 15: Generalized Darwinism, the nature of selection and market efficiency
While earlier evolutionary thinking in economics interpreted selection as a competitive process driven by scarcity, akin to Charles Darwin’s idea of struggle for survival, modern evolutionary economics recognizes, as Darwin had noted, that selection also operates at the group level. By contrast, the idea of sexual selection, which Darwin used to explain why traits that are wasteful from the point of view of survival selection may nonetheless evolve, has thus far been overlooked. The chapter demonstrates how, within the group selection context of the firm, the causal logic of sexual selection is relevant, and why this provides a good reason to reject Milton Friedman’s claim that market efficiency implies that firms maximize profits. Specifically, it is likely that the bottom-up process of mutual preference selection between firms and their employees results in organizational cultures that overshoot their functionality in terms of efficiency in product markets.
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.