Economic theories of managing renewable resources, such as fisheries and forestry, traditionally assume that individual harvesters are perfectly rational and thus able to compute the harvesting strategy that maximizes their discounted profits. The current paper presents an alternative approach...

The purpose of this paper is to show how institutional and evolutionary economics provide better insights as to whysome firms survive and others do not than does neoclassical economics. At the heart of the evolutionary theory isthe view that new firms are a manifestation of diversity and that...

Traditional finance is built on the rationality paradigm. This chapter discusses simple models from an alternative approach in which financial markets are viewed as complex evolutionary systems. Agents are boundedly rational and base their investment decisions upon market forecasting heuristics....

We address the notion of dynamic, endogenous diversity and its role in theories of investment and technological innovation. We develop a formal model of an innovation arising from the combination of two existing modules with the objective to optimize the net benefits of diversity. The model...

Recent advances in evolutionary theory have important implications for environmental economics. A short overview is offered of evolutionarythinking in economics. Subsequently, major concepts and approaches inevolutionary biology and evolutionary economics are presented andcompared. Attention is...

We consider the microfoundations controversy from the perspective ofeconomic evolution and show that the debatecan benefit from lessons learned in evolutionary biology. Althoughthe analogy between biology and economics hasbeen noted before, it has rarely focused on clarifying the micro-macro...