Economics in the Shadows of Darwin and Marx
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Economics in the Shadows of Darwin and Marx

Essays on Institutional and Evolutionary Themes

Geoffrey M. Hodgson

Economics in the Shadows of Darwin and Marx examines the legacies of these two giants of thought for the social sciences in the twenty-first century.
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Chapter 10: The Complex Evolution of a Simple Traffic Convention

Geoffrey M. Hodgson


An institution is of the nature of a usage which has become axiomatic and indispensable by habituation and general acceptance. Thorstein Veblen, Absentee Ownership and Business Enterprise in Recent Times (1923) 10.1 INTRODUCTION This chapter presents an agent-based simulation of the emergence of a traffic convention – concerning whether to drive on the left or the right of the road. The interaction between agents and structures involve causal influences in two directions, showing how agents constitute institutions and how institutions can have reconstitutive causal effects on individuals.1 The evolution of conventions and institutions has become the subject of much analysis, modelling and discussion.2 We raise here some further analytical and conceptual issues on the basis of a heuristic, agent-based simulation with heterogeneous agents. The general outcome of the simulation is relatively uncomplicated because we choose one of the most straightforward of decisions and conventions: whether to drive on the right or on the left of the road.3 In our model, artificially intelligent ‘drivers’ in ‘cars’ are programmed to negotiate a circular road configuration along with a number of other, similar vehicles. We show that the emergence of a convention is possible but by no means guaranteed. Furthermore, some manipulation of the decision processes through which these ‘drivers’ decide to move to the left or the right provides a basis to consider some of the deeper conceptual issues that are involved in the evolution of conventions, such as the nature of rational decision-making and its possible reliance upon habit. 1 This chapter...

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