American Economic Review: Vol. 103 No. 3 (May 2013)


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The Persistence of Inferior Cultural-Institutional Conventions

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Belloc, Marianna, and Samuel Bowles. 2013. "The Persistence of Inferior Cultural-Institutional Conventions." American Economic Review, 103(3): 93-98.

DOI: 10.1257/aer.103.3.93


Our theory of cultural-institutional persistence and innovation is based on uncoordinated updating of individual social norms and contracts, so that both culture and institutions co-evolve. We explain why Pareto-dominated cultural-institutional configurations may persist over long periods and how transitions nonetheless occur. In our model the exercise of elite power plays no role in either persistence or innovation, and transitions occur endogenously. This is unlike models in which elites impose inferior institutions or cultures as a self-interested distributional strategy. We show that persistence will be greater the more inferior is the Pareto-dominated configuration and the more rational and individualistic is the population.

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Belloc, Marianna (U Rome "La Sapienza")
Bowles, Samuel (Santa Fe Institute)

JEL Classifications

D02: Institutions: Design, Formation, and Operations
O17: Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
O43: Institutions and Growth
Z13: Economic Sociology; Economic Anthropology; Social and Economic Stratification

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