This paper traces the 11,000 year evolution of infrastructure systems during major periods of innovation, expansion and diffusion. Throughout history, the key role of the State is self-evident. Private sector involvement has waxed and waned over millennia, although at times it has been pivotal...

This paper considers a dynamic model of the evolution of open source software projects, focusing on the evolution of quality, contributing programmers, and users who contribute customer support to other users. Programmers who have used open source software are motivated by reciprocal altruism to...

In fiscal interaction, a policy is evolutionarily stable if, once adopted by all governments, jurisdictions that deviate from it fare worse than those that stick to it. Evolutionary stability is the appropriate solution concept for models of imitative learning (policy mimicking). We show that...

That individuals contribute in social dilemma interactions even when contributing is costly is a well-established observation in the experimental literature. Since a contributor is always strictly worse off than a non-contributor the question is raised if an intrinsic motivation to contribute...

Corporate success stories often resemble a snowball. We show how initial luck in hiring talented people, the resulting technological advantage, superior corporate culture, and statusseeking by workers and by consumers can make small initial differences generate large differences over time.

We consider the evolution of preferences when trade occurs between two countries. We show that if one country is much larger than the other, its preferences can eventually take over the preferences of the second country. This result may provide an explanation of why small countries sometimes...

Populist movements increasingly challenge liberal Western market democracies. Populism can be explained only in part by phenomena like globalization and digitization producing winners and losers in economic terms. Growing feelings of alienation from the market-democratic system and the perceived...

Markets are ubiquitous in our daily life and, despite many imperfections, they are a great source of human welfare. Nevertheless, there is a heated recent debate on whether markets erode social responsibility and moral behavior. In fact, competitive pressure on markets may create strong...

This paper studies the role of governments and its link to trust. We argue that the public's trust strongly depends on governments delivering on their core tasks in a market economy. In some economies, a neglect of core tasks can be observed and there seems to be some erosion, notably in terms...

We introduce a generalized theoretical approach to study imitation models and subject themodels to rigorous experimental testing. In our theoretical analysis we find that the differentpredictions of previous imitation models are due to different informational assumptions, notto different...