Evolutionary economy

As the name suggests, the work of economist Nathalie Lazaric, researcher Cnrsproposes to introduce the reader to a set of approaches and work having a special place within economic science and which is generally designated under the name “ evolutionary economy ” (Or “ evolutionary economy »). These works and approaches “ have the main ambition to understand the emergence of novelty and to interpret change, given the environment and the history in which the systems are located (P. 1). Even if the work is essentially descriptive, it reveals a certain number of theoretical and methodological issues.

Evolutionism and economy, a long and tumultuous story

The work consists of four concise but dense chapters each addressing an aspect of evolutionary thought in economics. The first chapter offers a return to the origins of this current of thought. Indeed, if the evolutionary economy has experienced a dazzling renewal since the mid -1980s, as revealed by bibliometric studies cited by the author, its history in fact began much longer. The most optimistic will thus see in the works of Adam Smith and Thomas Malthus, whose Darwin was inspired to conceive his theory of natural selection, the first rudiments of an evolutionary economic thought. But it was especially in 1898 that economic science and evolutionary thought were found with the article by the American economist Thorstein Veblen, “ Why is Economics Not an Evolutionary Science ? ». In this article, Veblen notes that economic science has not yet taken the turn of the Darwinian revolution and thus calls for a real change in paradigm, enjoining economists to be interested in the processes of “ cumulative causation By which social institutions evolve and transform. A year later, Veblen will put his own recommendations into practice by studying the evolution of ostentatious consumption practices in his famous work Leisure class theory.

The fact that it is Veblen, an economist on the sidelines of the profession (as of American society of the rest), who opens the way of the evolutionary economy would augur ambivalent relations between this approach and the so -called economy “ neoclassical “(Appellation that we owe precisely to Veblen, who thus intended to make fun of marginalist economists), ambivalence always relevant as the author points out throughout the book. The first chapter also addresses the contributions of two other authors whose positioning in the history of economic ideas is uncertain, Joseph Schumpeter and Friedrich Hayek. The modern history of evolutionary economy did not start until the 1970s, however, with pioneering works of economists like Sidney Winter and Richard Nelson, which will serve as a base for a large part of the theoretical and empirical developments of the last thirty years . The evolutionary project implemented by these two authors will endeavor to allow a better understanding of the evolution processes guiding the history of institutions and economic systems. Thus, history and evolution are intimately linked in an evolutionary perspective: it is the seriousness of the importance of history to understand the economic phenomena which will make necessary the study of the mechanisms of evolution making intelligible the technological technological trajectories , organizational and institutional economies. By introducing this historical dimension, the evolutionary economy will immediately position itself, not in opposition, but on the margins of the standard economic approach. Between dialogue and opposition to the latter, the evolutionist approach will thus develop at a complex paradigmatic crossroads and sometimes a source of ambiguities.

Growth, innovation and organizational change

The second and third chapters present what constitutes today the two major fields of study of the evolutionary economy: the analysis of the relationship between economic growth and technological innovation (macroeconomic aspect) and the study of learning phenomena and organizational change (microeconomic appearance). These two fields bring together a real abundance of works that are both empirical and theoretical. Presenting the results of this research in less than fifty pages is a real challenge, which the author takes up wonderfully, even if on occasion, the reader will find certain explanations too fast. Note in passing that the author has chosen (probably constrained by the available space) not to devote a specific chapter to a third field of study being an integral part of the evolutionary economy: the evolution of institutions, standards and Preferences. Some aspects are discussed in various places, but we can regret that the author does not give a more systematic view of it.

We will only mention a few of the work discussed by the author. Research around the concept of “ national innovation system “Fits in the neo-Schumumpterian tradition inaugurated by Sydney Nelson and Richard Winter in their 1982 work Evolutionary Theory of Economic Change. These works, essentially empirical in nature, seek to shed light on the relationships between technological innovations, growth factors, and national economies institutions. Innovation is then thought of as the result of a set of facilitating institutional factors, or on the contrary binding, the ability of an economy to initiate the emergence and dissemination of technological innovations. The first studies were mainly interested in the case of the Japanese economy, because of its close articulation of public and private institutions and its dynamism of the time. Studies have since expanded to many countries and today seek to integrate the impacts of the economic integration process, making reasoning in terms of “ national system »Less relevant.

On a more microeconomic level, the evolutionary economy will bring important lighting on the processes by which companies adapt and evolve through organizational learning mechanisms. Here again, the work of Nelson and Winter served as a source of inspiration. The publication of the book Organizational Systematics From Bill McKelvey, also in 1982, also constituted a major starting point. In this work, the essential concept is that of routine. A routine can be individual, it is then defined as a predisposition to adopt certain behaviors in a more or less automatic manner. A routine can also be organizational: it is then interpreted as a repertoire of collective skills that the organization can activate, again in an almost automatic way. In their 1982 work, Nelson and Winter make routines the equivalent of the gene at the economic level. As Nathalie Lazaric notes, this reference to biology will later be abandoned by the authors themselves, even if today the question of the biological metaphor rebuilds again. The work mobilizing the concept of organizational routine develop an important reflection on the adaptability of different organizational forms, on the nature of the mechanisms allowing change in companies or on the factors of organizational performance. In the same way as for studies on growth and innovation, the results which emerge from the literature do not necessarily fall into contradiction with those resulting from more “work” standard ». For example, evolutionary research on technological innovation and growth converge very largely with work around endogenous growth. It is more at the methodological level that the differences are apparent.

Evolutionary modeling

The fourth and last chapter of the book presents the main methodological tools, of a microeconomic nature, mobilized within the framework of the evolutionary economy. This part is welcome given that the singularity of the evolutionary economy is first at this level, even if we note that, more and more, evolutionary tools are reappropriated by the standard economy. However, we can regret that this chapter suffers, much more than the others, of the concessions which must be made in a work of this type. Thus, the developments on the different tools are very succinct and it is not certain that the reader who discovers this field is able to grasp all the issues hiding behind the methodological discussion.

The year 1982 was definitively a great vintage for the evolutionary economy, since it was also during this year that the biologist John Maynard Smith published his work Evolution and the Theory of Games. Based on work developed since the 1960s, Smith offers no more or less than a new way of using and interpreting game theory. Maynard Smith develops several concepts (including that of evolutionary strategy) and models which he applies to the study of animal conflicts. Economists will soon appropriate this new tool as it is promising to study the evolution of social standards and economic behavior. More recently, some economists have undertaken to go further in the importation of formalizations from biology, by appropriating for example the formalism of the price equation, thus making it possible to renew reflection on the nature of the process of economic selection or on the importance of group selection. Evolutionary economy also draws part of the developments of “ complexity sciences »Grouping analysis of networks, multi-agent simulations or even theory of graphs. These developments have enabled the emergence of a real “ third way »Methodological, distinguishing itself from both deductive analysis of analytical formalization and inductive reasoning of empirical approaches. It is then a question of building and reasoning from real “ artificial worlds », Whose exploration is now made easy by the power of computers. Nathalie Lazaric points out to readers a series of work that has implemented these methods in several areas (functioning of financial markets, technological diversification process, etc.)

The work ends with a conclusion that puts in perspective new fields of research that may interest evolutionary economy. That of the relationship between economy and ecology has already given rise to some innovative studies on the evolution of consumption “ green ». The conclusion also explains a tension that is filigree throughout the work, the ambiguous relationship of the evolutionary economy with the biological metaphor. On this level, we can note an interesting paradox: as the author strongly notes, the most recent modeling methods (analysis of networks, multi-agent simulations) seem to distance the evolutionary economy from any biological prism. However, it should be noted that these same methods have been used, sometimes sometimes, by biologists and other scientific disciplines. The evolutionary economy, in addition to the first crossroads mentioned above relating to the standard economy, is thus probably at a second crossroads: that of what can be called “ complexity sciences And the economy. To paraphrase Veblen, one can then wonder if the economy can become a science of complexity. If this is the case, the evolutionary economy will certainly be its front door.