My research – old

This page has been replaced with an updated version, which you can find here.

For most of history, humans experienced static living standards, with the average per capita income remaining constant. The world languished in a Malthusian state where any improvement in technology was rapidly subsumed by population growth. Around 1800, a small part of the global population started to exit the Malthusian trap with the advent of the Industrial Revolution. Since then, rising living standards have spread to a majority of the world’s population. Why, after living standards had languished for thousands of generations, did their level suddenly take off?

My research aims to establish a theoretical framework to test whether “time preference” could have been a trait under natural or sexual selection, favouring those genotypes with more patience and a higher propensity to save and invest. As a result, selection on specific genes in some human populations could have been a contributing factor to the transition from the low-growth Malthusian economy of pre-1800 to the modern high-growth economies of today.

Time preference refers to the rate at which people value goods received in the future compared to goods received today. The rate of time preference underlies the saving and investment decision. Individuals with lower rates of time preference are more inclined to save and invest due to the higher weight they give to future consumption. As a result, time preference affects the level of investment in physical capital and innovation, which both are major drivers of economic growth.

The rate of time preference exhibited by people may have a genetic basis. We would expect natural selection to act on variation in individual time preference, with certain rates maximising the returns of investment. The optimal rate would depend on factors that include rates of population growth, risk of death and changes in aggregate risk (a risk that when realised effects all members of a population). Aggregate risk would vary with shifts from hunter gatherer to agricultural societies with more complex division of labour.

Examination of evolution of time preference in economics has direct parallels to the study of reproductive effort in evolutionary ecology. Organisms face decisions on the ideal time to forage, whether a plant should seed this year or next and other trade-offs between different times.

The interaction between time preference, technology, risk and economic growth has the potential to induce selection, which in return could result in rapid, significant changes in economic growth. The aim of my research is to explore the theoretical foundations of these evolutionary and economic mechanisms by developing models that reflect the patterns in technology, growth and population that occurred during the Malthusian era and the transition to modern high growth regimes.

You can download my first working paper, an examination of the model developed in Galor and Moav, Natural Selection and the Origin of Economic Growth (2002) here.

Comments

  1. says

    Dear Jason,
    I’m an evolutionary biologist at UNSW in Sydney who has recently become very interested in the interactions between evolution and economics. I am about to publish my first book “Sex, Genes & Rock ‘n’ Roll: HOw Evolution has Shaped the Modern World” which is mostly evolutionary in outlook but often touches on economics. I really enjoyed finding your blog (at the suggestion of a student here), and look forward to reading it often. I’m going to link to it from my website if that is okay.

    I hope to be in touch in the future, and to possibly write a little about your work.

    With best wishes,
    Rob

  2. AC says

    I was puzzled by your analysis that states:
    “Around 1800, a small part of the global population started to exit the Malthusian trap with the advent of the Industrial Revolution”

    and your speculation that:

    “As a result, selection on specific genes [favoring “time preference”] in some human populations could have been a contributing factor to ultimately start the transition from the low growth Malthusian economy of pre-1800 to the modern high growth economies of today.”

    Clearly there could well be evolutionary advantage in “time preference”, but surely the selection for that trait was already advanced at the point of wide scale movement from hunter gatherer to agricultural economies (with pasturalism as an intermediate phase), prior to 8,000 BCE ?
    Agriculture represents the single greatest demonstrable adoption of “time preference” by humans – committing seed grain to propagation and committing breeding stock to produce offspring involves considerable time preferencing which over the course of years will almost certainly involve instances where choice must be made between imminent starvation and future benefit via propagation. I would suggest that it is this earlier period in recent human evolution that a much stronger Darwinian influence was at play in respect of time preference, something which could be evidenced by the rapid development of sophisticated time measuring common in early agricultural economies. Indeed time as a hard ‘concept’ could even be considered to be an artifact of agricultural development and a core element in the further development of ‘formal’ intelligence through the use of arithmetical thinking and mathematical symbolism, which appear language dependent (http://www.newscientist.com/article/dn20095-without-language-numbers-make-no-sense.html) but which may be a pre –requisite for the development of written language (studies of Sumerian etc).
    I’m not sure how this impacts on your hypothesis, but I’d suggest a trait that is not dependant upon very recent demographics but which is linked to sustained behavioural changes across the species over millennia would provide a more substantive basis for argument, even though it involves a degree of de-linkage with post 1800 development.

    My own perspective as a some time medievalist, is that 1800 CE is a very poor juncture at which to place the commencement of the European technological revolution and I see the post 1700 period to be no more than a sociologically and climatologically advantaged expansion of processes that were underway from at least 1100 CE.

    • says

      Thanks for your comment AC. I half agree with your comment relating to agriculture in that agriculture would have had a significant selection effect on time preference and the period during which agriculture was adopted may have been the time of strongest selection pressure. However, I consider that selection pressure on time preference was likely to have continued through to at least 1800 (I am loathe to guess what modern selection pressures are with the welfare state, contraception etc). The work of Gregory Clark, who showed in the period 1250 to 1800 that the wealthy had more children than the poor, suggests that selection pressures on certain traits were strong in the period immediately before the industrial revolution.

      On the choice of 1800 as the date of interest, this is the time where per-capita income finally increased above Malthusian subsistence levels (give or take a decade or two). While technological progress may have been increasing significantly before that time, it did not translate into per-capita income increases (i.e. increased births did not swallow up the technological gains) until then. To build a theory that allows for this sudden take-off in economic growth in 1800 does not require a large change in preferences immediately before that date. You could think of a certain threshold needing to be met, with selection pressures over thousands of years taking humans to that point. The major paper linking natural selection and economic growth by Galor and Moav is built on that premise.

  3. Maciano says

    Jason,

    I’ve been reading your blog for a while, very interesting. I was wondering if your PhD thesis is online somewhere. Personally I’d like to read about the intersection of economics and evolution.

    • says

      Hi Maciano, no thesis as yet but I am hoping to get another couple of working papers out and on-line before the end of the year. When they are ready, links to them will appear here (and I’ll probably write a post or two about them).

  4. Skytrek820 says

    Hi Jason,

    I happily stumbled upon this blog today, and wanted to take the opportunity to say keep up the good work!  Your research sounds very interesting.  I have an interest in the application of evolutionary theory to questions in the social sciences, particularly in political science.  Feel free to visit my own blog on the topic.  If you find it interesting/useful, perhaps we can link to each other’s site.  http://evolutionary-politics.blogspot.com/

    (nice post on the cooperation books; I share your opinions there)

    Anthony

    • says

      Hi Anthony,

      Thank’s for visiting. I had a look through your blog and it looks like some interesting stuff.

      However, I really do need to update the above (and my blog roll) – I’ve moved my research focus a bit over the last year to be more concerned with the evolutionary mechanisms than the particular trait.

      JC

Comments, thoughts, suggestions?