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WP 12-01

Johann Peter Murmann. Scaffolding in Economics, Management, and the Design of Technologies

Keywords: evolutionary theory, birth and death of organizations, technological evolution, economic history.


The goal of this paper is to review the ideas that have been developed to describe the emergence and change of structures in three fields: Economics, Management, and Design of Technologies.  The paper focuses on one empirical setting, the economy, and more specifically how firms, industries, and technologies change over time. Today’s industrialized economies are very different from the economies before the industrial revolution. The paper presents key theoretical ideas from evolutionary economics, management, and technology that try to explain why and how economy has been so dramatically transformed over the past 400 years.

You can download this paper here.

WP 09-01

Denis A. Semenov. Middle class as a stabilized dynamic system in economy

Keywords: middle class, Global financial crisis, credit.


A simple explanation for emergence, evolution and self-destruction of the middle class has been proposed. Lemeray’s diagram, which usually used for analysis predator-pray system, in this case fit for global economy.

You can download this paper here.

WP 08-01

Mikael Sandberg. A Bass Model of Democracy Diffusion 1800-2000

Keywords: democracy communication diffusion.


Political scientists seldom translate system terminology into systems analysis. This article uses Polity IV data to probe system dynamics for studies of the global diffusion of democracy from 1800 to 2000. By analogy with the Bass model of diffusion of innovations (1969), as translated into system dynamics by Sterman (2000), the dynamic explanation proposed focuses on transitions to democracy, soft power, and communication rates on a global level. The analysis suggests that the transition from democratic experiences (“the soft power of democracy”) can be estimated from the systems dynamics simulation of an extended Bass model. Soft power, fueled by the growth in communications worldwide, is today the major force behind the diffusion of democracy. Our findings indicate the applicability of system dynamics simulation tools for the analysis of political change over time in the world system of polities.

You can download this paper here.

WP 07-01

David F Ronfeldt. In Search of How Societies Work: Tribes—The First and Forever Form

Keywords: social evolution, tribes.


This working paper is the latest in a string of efforts to elaborate a theoretical framework about social evolution, based on how people develop their societies by using four forms of organization: tribes, hierarchical institutions, markets, and networks (see WP 05-05).  A lead-off chapter sketches the entire framework, and a “rethinking” chapter shows why the author thinks that social evolution revolves around these four forms.  The next two chapters focus on the paper’s main concern: the evolution of the tribal form.  Of the four forms, it was the first to emerge and mature, ages ago.  Its main dynamic is kinship, which gives people a distinct sense of identity and belonging.  In addition, classic tribes (and clans) tend to be egalitarian, segmental, and acephalous, lacking in centralized command and devoted to principles about honor, pride, dignity, and respect.  The tribe, as the first form of societal organization, initially defines nearly the totality of a society.  As the later forms develop, making societies more complex, this foundational form ceases to be the driving form.  Yet it never goes away; no durable society can do without it.  Even modern societies that lack explicit tribes and clans still have tribelike sensibilities at their core; the tribal form persists, for example, in nationalism, cultural festivities, and even such seemingly minor matters as sports and fan clubs and urban youth gangs.  Thus the tribe remains not only the founding form but also the forever form.  It shapes social ideals and affects how the other forms are adopted; it is also the natural fallback form if the other forms fail.  Meanwhile, essentially monoform tribal/clan societies and biform chiefdoms and clan-states, some dressed in the trappings of nation-states and capitalist economies, remain a ruling reality in vast areas of the world.  It behooves analysts and strategists who mostly think about states and markets to gain a better grip on roles the tribal form plays in both national development and national security. 

You can download this paper here.

WP 06-01

Geoffrey Hodgson, T. Knudsen. Replication, Information and Complexity

Keywords: replicators, complexity, automata.


This paper considers the development and refinement of the replicator concept. We find that the established definition of replication in terms of the triple conditions of causality, similarity and information transfer is too inclusive. We draw inspiration from the literature on self-reproducing automata to strengthen the notion of information transfer in replication processes. Essentially, we find that replication must have the potential to enhance complexity, which in turn requires that developmental instructions are part of the information that is transmitted in replication. In addition to the triple conditions of causality, similarity and information transfer, we adopt a fourth condition that defines a replicator as a conditional generative mechanism, a material entity that embodies mechanisms that can turn input signals from an environment into developmental instructions. Demonstrating the usefulness of the replicator concept in the social domain, we identify habits and other social replicators that satisfy all of the four proposed conditions for a possible replicator

You can download this paper here.

WP 05-05

David F Ronfeldt. Tribes, Institutions, Markets, Networks: A Framework about Social Evolution

Keywords: social evolution.


This informal preliminary paper outlines a theoretical framework for thinking about social evolution. The framework holds that four major forms of organization lie behind the governance and evolution of all societies across the ages: first tribes, then hierarchical institutions, then markets, and now networks.  While all four were present in ancient times, they have emerged in the order noted, partly because each requires a different information and communications revolution to mature.  Societies have advanced by learning to use and combine all four forms, their bright and dark sides, in a preferred progression.  To put it notationally, over the ages monoform societies organized in tribal (T) terms—many of which still exist today—are eventually surpassed by societies that also develop hierarchical institutional (I) systems to become biform T+I societies, normally with strong states.  In turn, these get superseded by triform societies that allow space for the market (M) form and become T+I+M societies, eventually with a proclivity for democracy.  Now the network (N) form is on the rise, so far strengthening civil society more than other realms (a yet-to-be-named network-based realm may emerge from it).  Thus a new phase of social evolution is dawning in which quadriform T+I+M+N societies will emerge to take the lead, and a vast rebalancing of relations among state, market, and civil-society actors will occur around the world.  A society’s leaders may try to deny or skip a form—the case with clannish ethnic groups that fail to form a real state, and with old Marxist-Leninist regimes that opposed the market—but any short-term success at this eventually proves limiting.  A society’s leaders may also constrain its prospects for evolutionary growth by elevating any single form to primacy—as appears to be a risk at times in highly pro-market systems.  As societies move (or fail to move) through the progression, the tribal (T) form, which originally dominated the design of societies, gets pushed increasingly into defining the cultural realm, where it exerts continuing influence over the other forms (e.g., through cronyism, nationalism, fads).  The author invites comments (email: ronfeldt[at]rand.org).

You can download this paper here.

WP 05-04

Colin D Jones. The Eclectic Necessity of an Evolutionary Approach to Entrepreneurship

Keywords: Entrepreneurship, Darwinian Evolution.


This paper explores that application of evolutionary approaches to the study of entrepreneurship. An eclectic approach that aims to highlight the multiple sources of evolutionary thought that frequently remain outside the boundaries of organizational theorizing is used. It is argued that any evolutionary theory of entrepreneurship must appreciate the foundations of evolutionary thought as much as it must consider the nature entrepreneurship. The central point being that we must move beyond a debate or preference of the natural selection and adaptationist viewpoints. Then, the interrelationships between individuals, firms, populations and the environments within which they interact may be better appreciated. 

You can download this paper here.

WP 05-03

Richard R Nelson. Evolutionary Theories of Cultural Change: An Empirical Perspective

Keywords: Empiricism, Univeral Darwinism, Cultural Change.


Evolutionary theorizing in the social sciences has a long tradition, going back well before Darwin. Much of contemporary evolutionary theorizing by social scientists about the processes of change at work in various aspects of human culture - for example science, technology, and business organization and practice - is motivated by the plausibility of an evolutionary theory as an explanation of the change going on, rather than by any deliberate attempt to employ Darwinian ideas. A considerable amount is known about the processes of change at work in these and other areas of human culture. Few of the contemporary proponents of a Universal Darwinism know much about this tradition, or about ongoing evolutionary research in the social sciences. Partly as a result, the standard articulations of a Universal Darwinism put forth by biologists and philosophers tends to be too narrow, in particular too much linked to the details of evolution in biology, to fit with what is known about cultural evolution. The objective of this essay is to broaden the discussion.

You can download this paper here.

WP 05-02

Smita Srinivas, Markku Sotarauta. The Co-Evolution of Policy and Economic Development: A Discussion

Keywords: co-evolution, emergence, intention.


The practical and philosophical focus of this paper is the link between emergence and intention for economic development, specifically as it relates to the development of technologically innovative regions. Our research questions are embedded in this core focus on intention and emergence of innovative industrial concentrations: Do policy and economic development co-evolve, and if so, how? How do localized adaptation processes, institutions and intention of a policy-network drive strategic renewal of industrial clusters? What we aim to do here is to investigate how policy influences or (merely) witnesses development, how development feeds policy, and how this plays out in technologically innovative regions.

You can download this paper here.

WP 05-01

Carsten Herrmann-Pillath. On Power as a Unifying Concept in the Naturalistic Foundation of the Social Sciences

Keywords: utility theory, adaptation, signal selection.


Although power is an ubiquitous phenonomen in human societies, the analytical concept of power remains marginal in economics. In this paper I consider a possible radical reorientation of economics which starts out from the methodological premise that economics, the social sciences in general and biology should be integrated into a coherent ontological framework. The conceptual vehicle for achieving such an integration are “bridging concepts” that allow for related empirical interpretations in different ontological domains, and which serve to formulate hypotheses about cross-domain causalities. I show that the core concept of neoclassical economics, subjective utility, cannot serve as a bridging principle, and I propose to substitute utility for power in terms of its two semantic dimensions, “power to do” and “power over.” Power as a theoretical term to cover the capability of an organism to control its natural and social environment can be easily related to both evolutionary concepts (in particular, adaptation) and economic concepts like social capital and capabilities. An ensuing core argument of the paper is to shift attention away from scarcity as a possible common ground between evolutionary theory and economics, and to turn to communication as a low-cost device of controlling the actions of other actors to ego’s advantage. I relate this to Sober and Wilson’s revised idea of group selection and demonstrate that the combination between group-internal low-cost signalling and group-external high-cost signalling is a crucial abstract principle of the emergence of complex social power structures. Thus, important similarities between recent evolutionary approaches to signalling, in particular the Zahavis’ theory of signal selection, and institutional economics can be uncovered which open fresh sights on the unification of the human sciences.

You can download this paper here.

WP 04-03

Carl P Lipo, Mark E. Madsen. Evolution And Organizational Change Within Complex Social Groups

Keywords: Complex Societies, Multi-level selection, Archaeology.


The origin and development of complex societies - those in which members are functionally specialized and interdependent - has long been the province of cultural evolutionary or “progressive” modes of explanation.  Growth, whether in population, economic scale, or technological prowess, underpins most traditional explanations for increasing social complexity.  More recently, evolutionary approaches to behavior have given us the methodological and theoretical tools needed for a deeper understanding of complex societies, based on scientific studies of evolution and cultural transmission.  Here, we argue that complex societies reflect a change in the scale at which selection operates among cultural individuals, and examine the methodological requirements for multi-level evolutionary models of complex social organization.  Developing analytic tools for measuring functional specialization and integration, we explore two examples of social complexity.  The first focuses on United States economic history and studies measures of economic integration in light of our framework.  In the second example, we turn to the late prehistoric populations of the Central Mississippi River Valley and develop numerical techniques for studying multi-level organization in the archaeological record.

You can download this paper here.

WP 04-2

Marion Blute. The Evolutionary Socioecology of Communication

Keywords: evolutionary socioecology of communication, signal strength, rituals.


This paper begins with a brief introduction to multi-process selection theory, to what explains the existing array of alternatives in evolving populations, and to some basic principles of evolutionary ecology. Evolutionary ecology asks, and seeks to answer, the question of under what ecological conditions selection favours what kinds of characteristics including the behavioural, characteristics oriented towards the physical environment and other species. While communication is sometimes involved in interaction among species, it is more prevalent among members of the same population or species. Evolutionary socioecology then asks and seeks to answer the same question about ecologically versus socially oriented characteristics as well as the purely social. In discussing some general principles of the evolutionary socioecology of communication, this paper pays particular attention to the sometimes cooperative, sometimes antagonistic, and often mixed nature of social communication.  It concludes with a discussion of what determines the “loudness” of signals and what “rituals” are communicating.

You can download this paper here.

WP 04-1

Johann Peter Murmann, Koen Frenken. Toward a Systematic Framework for Research on Dominant Designs…

Keywords: Dominant Designs, Evolution of Artifacts, Architecture of Complex Systems, Product Life Cycle.


The concept of a dominant design has taken on a quasi-paradigmatic status in the analysis of the link between technological and industrial dynamics. A review of the empirical literature reveals that a variety of interpretations exist about some aspects of the phenomenon such as its underlying causal mechanisms and its level of analysis. To stimulate further progress in empirical research on dominant designs, we advocate a standardization of terminology by conceptualizing products as complex artifacts whose technological evolution proceeds in the form of a nested hierarchy of technology cycles. Such a nested complex system perspective provides both unambiguous definitions of dominant designs (stable core components which can be stable interfaces) and the inclusion of multiple levels of analysis (system, subsystems, components). We introduce the concept of an operational principle and offer a systematic definition of core and peripheral subsystems based on the concept of pleiotropy. The paper concludes with a discussion of how our proposed terminological standardization can stimulate cumulative research on dominant designs.

You can download this paper here.

WP 03-2

Giovanni Gavetti. Evolutionary Theory Revisited: Cognition, Hierarchy, and Capabilities.

Keywords: Firm Capabilities, Cognition, Simulation Methodology ..


Building on a field study of Polaroid’s transition from analog to digital imaging, this article identifies important lacunae in evolutionary research on capabilities. It argues that this research has focused excessively on the emergent, quasi-automatic nature of capability development, thus neglecting the role of cognition and deliberation. Furthermore, because it conceives capabilities as developing “from below,” this view grants no role, or a very restricted role, to influence from the top and therefore underplays the role of organizational hierarchy in capability development. This paper begins to fill these twin gaps. The field study grounds the development of an agent-based simulation model that focuses on processes of cognition and experiential learning at different levels of an organizational hierarchy. The model shows how these processes differ by hierarchical level, how they interact, and how corporate executives can influence these interactions. This conceptual apparatus allows me to build theory at two levels. On the one hand, I delineate the traits of a micro-foundation for research on capabilities that addresses these lacunae. On the other hand, I shed light on the role of corporate executives in the development of capabilities and, more broadly, in strategic decision-making.

WP 03-1

Johann Peter Murmann. The Coevolution of Industries and Academic Disciplines.

Keywords: Coevolution, Industry Analysis, Development of Science. .


Based on a five-country historical case study of the synthetic dye industry and the discipline of chemistry, the paper argues that academic disciplines, like industries, change through variation, selection, and retention processes. Using a comparative historical method and drawing on inductive evidence spanning a 60-year period, the study clarifies how national industries and academic disciplines coevolve as a result of mutualistic causal processes that work alongside well-known competitive processes. The analysis identifies three causal processes as being responsible for the coevolution of national industries and national academic disciplines: the exchange of personnel between industrial firms and academic organizations, the formation of commercial ties between the two social arenas, and lobbying by each on the other’s behalf. In both social arenas, the exchange of personnel affects the variation, selection, and retention processes, whereas the formation of commercial ties affects only the variation and selection processes, and lobbying affects only the selection processes.

You can download this paper here.

WP 02-5

Jan Fagerberg. A Layman’s Guide to Evolutionary Economics

Keywords: Evolution, Schumpeter, Innovation, Growth Theory.


During the last decades we have seen a revival of interest in the works of Joseph Schumpeter and “evolutionary” ideas in economics more generally. This paper presents an overview and interpretation of these developments. Following an introductory discussion of the concepts and ideas (and their origins) the main characteristics of Schumpeter’s own contribution are presented. On this basis we make an assessment of the more recent contributions in this area, the (mostly applied) “neo-schumpeterian” literature that attempts to use Schumpeterian concepts to empirically analyse real world phenomena, and the more formal “evolutionary modelling” literature associated with the names of Sidney Winter and Richard Nelson. Finally we raise the question of how much the different contributions considered in the paper actually have in common (is there a common core?), and what the differences and similarities are when compared to other approaches (particularly the so-called “new growth theory”).

You can download this paper here.

WP 02-4

William Barnett, David McKendrick. The Organizational Evolution of Global Technological Competition

Keywords: .


Various industries are marked by rapid technological change and increasingly global competition.  We explain how such developments provide a context for “Red Queen” competition, where organizational learning and competition accelerate each other over time.  Arguing that competition stimulates organizational development, we predict that organizations experiencing a history of competition are less likely to fail.  This implies that a strategy of technological differentiation generates short-run survival advantages, but backfires over time as isolated organizations suffer from increasing rates of failure.  Also, we argue that the Red Queen magnifies differences in competitiveness among organizations due to underlying differences in their propensities to learn, so that technologically leading organizations are especially strong competitors.  This strength, paradoxically, makes technological leadership a hazardous strategy because technological leaders must compete against stronger rivals.  We find support for these conjectures in a study of the worldwide hard disk drive market, estimating organizational ecology models that allow for increasing global competition over time and that help to explain national differences in organizational survival rates.

You can download this paper here.

WP 02-3

Tony Fu-Lai Yu. An Entrepreneurial Perspective of Institutional Change.

Keywords: Entrepreneurial discovery, Institutions, Coordination, Learning.


Utilizing Kirzner’s theory of entrepreneurial discovery, Schumpeter’s two types of economic responses and the Austrian theory of institutions as building blocks, this paper constructs an entrepreneurial theory of institutional change. Focusing on the coordinating role of human institutions, this paper argues that entrepreneurial extraordinary discovery destroys the stability of institutions and creates uncertainty in the market (creative response). As a result, institutions are incapable of coordinating economic activities because market participants’ stocks of knowledge are no longer adequate to solve new problems. Hence, profit gaps or mismatches of market participants’ plans occur. Given new technologies, new relative prices and tastes, imitative entrepreneurs soon identify and capitalize on the opportunities created by Schumpeterian extraordinary discoveries (adaptive response). Imitators improve production methods, modify rules and alter property rights in order to improve coordination. Through learning, experimentation, trial and error, the more rewarding methods are then selected. Successful actions are imitated and repeated in the market, and gradually crystallized into new institutions which once again serve as social coordinators.

WP 02-2

Richard N. Langlois. The Vanishing Hand: the Changing Dynamics of Industrial Capitalism.

Keywords: Industrial Organization, Markets, Managerial Hierarchies.


In a series of classic works, Alfred Chandler challenged the prediction (implicit perhaps in Adam Smith’s account of the division of labor and the Invisible Hand) that economic growth would always lead to finer market decentralization. In the late nineteenth and early twentieth centuries, Chandler showed, the visible hand of managerial coordination replaced the invisible hand of the market. Many would argue, however, that the late twentieth century witnessed an organizational revolution at least as important as the one Chandler described. In that epoch, Smithian forces clearly outpaced Chandlerian ones. This paper is a preliminary attempt to explain why: to provide some theoretical insight into the organizational structure of the new economy. The basic argument - the vanishing-hand hypothesis - is this. The managerial revolution Chandler chronicled was the result of an imbalance between the coordination needs of high-throughput technologies and the abilities of contemporary markets and contemporary technologies of coordination to meet those needs. With further growth in the extent of the market and improvements in the technology of coordination, the central management of vertically integrated production stages is increasingly succumbing to the forces of decentralization.

You can download this paper here.

WP 02-1

William Barnett, Olaf Sorenson. The Red Queen in Organizational Creation and Development.

Keywords: Organizational Learning, Red Queen Evolution, Industry Analysis.


We synthesize organization learning theory and organizational ecology to predict systematic patterns in the founding and growth of organizations over time.  Our central argument is that competition triggers organizational learning, which in turn intensifies competition that again triggers an adaptive response.  We model this self-exciting dynamic - sometimes referred to as the “Red Queen” in general evolutionary theory - to explain organizational founding and growth rates among the thousands of retail banks that have operated in Illinois at any time from 1900-1993.  We find strong evidence that Red Queen evolution led some organizations to grow quickly and to place strong competitive pressure on rivals.  Red Queen evolution also helped establish barriers to entry.  However, this same evolutionary process appears to make organizations more susceptible to “competency traps,” ultimately slowing their growth rates and inviting new market entry.  Organizations confronted by a widely varying distribution of competitors, by contrast, grow more slowly and more likely face new entrants.  Overall, the results suggest that processes of organizational creation and growth emerge from ecologies of learning organizations.  More generally, we discuss the use of ecological theory and models to study the empirical consequences of organizational learning.

You can download this paper here.

WP 01-5

Roderick Wallace. Draft of “Selection Pressure and Organizational Cognition: Implications for the Social Determinants

Keywords: Evolutionary punctuation, Health, Inequality, Information theory, Phase transition, Social networks.


We model the effects of Schumpeterian ‘selection pressures’ - in particular Apartheid and the neoliberal ‘market economy’ - on organizational cognition in minority communities, given the special role of culture in human biology. Our focus is on the dual-function social net-works by which culture is imposed and maintained on individuals and by which immediate patterns of opportunity and threat are recognized and given response. A mathematical model based on recent advances in complexity theory displays a joint cross-scale linkage of social, individual central nervous system, and immune cognition with external selection pressure through mixed and synergistic punctuated ‘learning plateaus.’ This provides a natural mechanism for addressing the social determinants of health at the individual level. The implications of the model, particularly the predictions of synergistic punctuation, appear to be empirically testable.

You can download this paper here.

WP 01-4

Johann Peter Murmann. Introductory Chapter to “Knowledge and Competitive Advantage: The Coevolution of Firms, Technology,

Keywords: Competitive Advantage, Coevolution, Industry Analysis.


This study argues that the creation of productive capabilities underlying successful firms and the institutional context surrounding firms are related through interactive, coevolutionary processes. To induce a dynamic framework for analyzing the sources of competitive advantage, I examine the processes through which German firms became dramatically more successful than their British and American counterparts in the synthetic dye industry. I specifically examine how the fortunes of synthetic dye firms have been influenced by differences in the educational systems and patent laws. I find that firms are in part successful because they develop collective strategies to mold the institutional context in their favor.

You can download this paper here.

WP 01-3

Richard R Nelson. On the Complexities and Limits of Market Organization.

Keywords: Economic Organization, Economic Change.


The close of the twentieth century saw a virtual canonization of simple market organization as the best, indeed the only really effective, way to organize and govern economic activity. This essay is not to gainsay the present conventional wisdom, but to try to civilize it and nudge it to be more nuanced and subtle. The present canonization is a real problem. The United States and other advanced industrial nations presently are facing a number of challenging and often contentious issues regarding how to organize and govern a variety of activities that employ a large and growing fraction of their resources. While for some of these simple market organization may be a satisfactory answer, for many it will not. This essay aims to illuminate the issues, and explores where markets work reasonably well, where markets need to be supplemented by a variety of non market mechanisms to provide a satisfactory governance structure, and where central reliance probably needs to be placed in non market structures.

WP 01-2

Howard E Aldrich, Martha Argelia Martinez. Many are Called, but Few are Chosen: An Evolutionary Perspective for the Study of Entrepreneurship.

Keywords: Entrepreneurship, Networks, Taxonomy of Environmental Forces.


More than a decade ago, Low and MacMillan identified three elements indispensable to an understanding of entrepreneurial success: process, context, and outcomes.  Since their critique, three important advances include (a) a shift in theoretical emphasis from the characteristics of entrepreneurs as individuals to the consequences of their actions,  (b) a deeper understanding of how entrepreneurs use knowledge, networks, and resources to construct firms, and (c) a more sophisticated taxonomy of environmental forces at different levels of analysis (population, community, and society) that affect entrepreneurship.  Although our knowledge of entrepreneurial activities has increased dramatically, we still have much to learn about how process and context interact to shape the outcome of entrepreneurial efforts.  From an evolutionary approach, process and context (strategy and environment) interact in a recursive continuous process, driving the fate of entrepreneurial efforts.  Thus, integrating context and process into research designs remains a major challenge.  Such integration constitutes a necessary step to a more complete evolutionary approach and a better understanding of entrepreneurial success.

WP 01-1

Bruce S. Fetter. Genes, Memes, and Contingency: The Effects of Purposive Action in Mortality Reduction.

Keywords: Memes, Human Mortality, Health Care, Long-term Social Change.


The term “meme” was coined by the biologist Richard Dawkins in 1976 to explain how the transmission of ideas in human society differs from that of genetic materials in living organisms. Although genes and memes both reproduce themselves through imitation, memes can transmit acquired characteristics, allowing them to change quickly. Clusters of ideas which promote longer life can be seen as health care memeplexes. Over the last 2500 years, these memeplexes have been transmitted through four social groups: families, healers, religious organizations and governments. In the last two centuries, economic considerations have played an increasing role in the implementation of health care memeplexes.

WP 00-5

Maurizio Zollo, Sidney G. Winter. From Organizational Routines to Dynamic Capabilities.

Keywords: Organizational Capabilities, Knowledge-based Theories of the Firm, Knowledge Codification.


This paper investigates the mechanisms through which organizations develop capabilities in a dynamic sense (Teece, Pisano & Shuen, 1997) and reflects upon the role of (1) experience accumulation, (2) knowledge articulation and (3) knowledge codification processes in creating and constantly reshaping organizational routines.  The argument is made that dynamic capabilities originate from the co-evolution of these three mechanisms.  At any point in time firms adopt a mix of learning behaviors constituted by a semi-automatic accumulation of experience and by increasingly deliberate investments in knowledge articulation and codification activities.  Further, the relative effectiveness of these capability-building mechanisms is analyzed here in their interaction with selected features of the task to be learned, such as its frequency, homogeneity and degree of causal ambiguity.  Testable hypotheses are developed in the context of a theoretical model of dynamic capability building, and some preliminary empirical evidence in support of the arguments made is reviewed.  Finally, implications of the analysis for evolutionary economics and for the emerging knowledge-based view of the firms are discussed and an agenda for future research efforts on these issues is advanced.

WP 00-4

Richard R Nelson, Bhaven Sampat. Making Sense of Institutions as a Factor Shaping Economic Performance.

Keywords: Methodology and History of Economic Thought, Economic Development, Industrial Organization.


There has been a resurgence of interest in how institutions affect economic performance. A review of this literature reveals that the concept of an “institution” means different things to different scholars, both within economics and across the social sciences. We discuss what factors unify the different definitions of institutions, and develop a concept of institutions useful for the analysis of economic performance, and economic growth in particular. Specifically, we develop the notion of institutions as standard “social technologies.” Economic growth results from the co-evolution physical and social technologies. The article is now published in the Journal of Economic Behavior & Organization, Vol. 44 (2001) 31-54. Download pdf file from the authors web or the JEBO web.

WP 00-3

Louis Galambos, Jeffrey Sturchio. Science, Executive Leadership, and Business: The Multinational Gives Way to the Global Firm in Pharm

Keywords: Industry evolution, top management teams, globalization.


The authors conclude that in pharmaceuticals the MNE, which operates through susidiaries in a number of nations but is controlled by nationals from the headquarters country, is starting to give way to a new form of global enterprise which draws its executives as well as its employees from a wide variety of national cultures, educational systems, and business settings.  R&D and in some cases R&D leadership are internationalized.  Using a prosopographical methodology, they develop data that is consistent with the theory of evolutionary economics, which suggests that greater diversity will conduce to a more successful adaptation to a competitive environment.

WP 00-2

Joel Mokyr. Science, Technology, and Knowledge: What Historians can learn from an evolutionary approach.

Keywords: Technical change, evolution of technology, knowledge typology.


This paper puts down the essential elements of a Darwinian model that could be useful in analyzing historical situations of technological change. It argues that, following Nelson and Winter, the unit of analysis should be the technique, that is, a set of instruction on how to manipulate natural regularities for material advantage, that is, produce. It argues that such a model needs to contain three components: a dual setup that consists of an underlying structure and a manifest entity; a dynamic structure in which units in some fashion reproduce and pass on information over time; and a property of superfecundity which necessitates selection, which gives the system direction over time. The dual structure consists of two types of human knowledge: knowledge of the what and why (W-knowledge) and the knowledge of how (l-knowledge) which is set of blueprints and instructions of all techniques. The paper discusses the historical meaning of selection and how evolutionary principles can help us understand historical phenomena even if there are fundamental differences between the evolution of technology and that of living beings.

WP 00-1

Joel Mokyr. Knowledge, Technology, and Economic Growth During the Industrial Revolution.

Keywords: Evolution of knowledge, economic growth, positive feedback..


This paper is an application of evolutionary theory to a concrete historical problem, namely explaining the timing of the Industrial Revolution in the last third of the eighteenth century. The argument is that useful knowledge (that is, knowledge and understanding of natural phenomena and regularities) constrains the form that techniques can take. It defines the central concept of an epistemic base of a technique, which describes how much of the natural forces underlying the functioning of a technique are understood. The paper then argues that despite of the widespread notion that science had little to do with the Industrial Revolution, the rapid changes in the diffusion of and access to useful knowledge as much as scientific breakthroughs, helped make the Industrial Revolution possible. In that way, the scientific revolution and the enlightenment triggered an “information revolution” that helps explain the timing of the Industrial Revolution. This view is reinforced by pointing out that the unique historical event was not just the traditional “wave of gadgets” of the 1760s and 1770s but the fact that these did not peter out in the first decades of the nineteenth century. The technological system in Western Europe, and especially in Britain, shows growing positive feedback and complementarity between techniques and the useful knowledge underlying them leading eventually to a self-reinforcing dynamic system of technological progress.

WP 99-5

David Hull, Rodney E. Langman, and Sigrid S. Glenn. A General Account of Selection: Biology, Immunology and Behavior.

Keywords: General theory of selection; variation, replication, evolution, selection processes in: operant behavior, operant learning; immunology..


Numerous different phenomena seem on the surface to be instances of selection. In this paper, we provide a general account of selection in biological evolution, the response of the immune system to antigens, and operant learning. The three fundamental elements of selection are replication, variation and environmental interaction. However, these elements must be arranged in a very precise way for selection to occur. The net results are changes in more inclusive systems to form lineages.

WP 99-04

Geoffrey Hodgson. Darwin, Veblen and the Problem of Causality

Keywords: Evolutionary Economics, Theories of Causation. History of Evolutionary Ideas in the Social Sciences..


This article discusses some of the ways in which Darwinism has influenced a small minority of economists. It is argued that Darwinism involves a philosophical as well as a theoretical doctrine. Despite claims to the contrary, the uses of analogies to Darwinian natural selection theory are highly limited in economics. Exceptions include Thorstein Veblen, Richard Nelson, and Sidney Winter. At the philosophical level, one of the key features of Darwinism is its notion of detailed understanding in terms of chains of cause and effect. This issue is discussed in the context of the problem of causality in social theory. At least in Darwinian terms, the prevailing causal dualism - of intentional and mechanical causality - in the social sciences is found wanting. Once again, Veblen was the first economist to understand the implications for economics of Darwinism at this philosophical level. For Veblen, it was related to his notion of ‘cumulative causation.’ The article concludes with a discussion of the problems and potential of this Veblenian position.

WP 99-3

Geoffrey Hodgson. Is Social Evolution Lamarckian or Darwinian?

Keywords: Models of Evolution in the Social Sciences.


Is social or cultural evolution Lamarckian in some sense? A positive answer to this question may appear to threaten the consistency of the biological with the social sciences. Furthermore, the modern notion of ‘Universal Darwinism’ might also threaten any Lamarckian conceptions in the social sphere. It is argued in this paper that while theories of social and biological evolution must be consistent with each other, they do not have to be identical. Whether social evolution is Lamarckian depends on whether there is something like the inheritance of acquired characters at the social level. This, in turn, raises the question of the unit of cultural inheritance and replication. Some alternative proposals for such a unit are discussed. The essay concludes that a version of Lamarckism in the social sphere can be consistent with Darwinian principles. As Donald Campbell suggested some time ago, both social and biotic evolution are special cases of more general processes of evolution of complex systems. If this general schema can be described as ‘Darwinian’ then it is a much more powerful label than ‘Lamarckian’, which by contrast indicates much less. Other working papers by Hodgson.

WP 99-2

Richard R Nelson, Katherine Nelson. On the Nature and Evolution of Human Know How.

Keywords: Evolution of Knowledge, Cognitive Science, Learning, Knowledge Typology, Growth of Knowledge in Technology and Science.


The authors explore some connections between bodies of empirical research and theorizing that bear on technological know how and its advance. Observing that scholarship on technological change has virtually not interacted with cognitive science, the authors explore problems, similarities, and opportunities for cross-fertilization in these two arenas of inquiry. The authors see trial-and-error learning in models of cognitive science as congenial to an evolutionary epistemology view of technical change. Noting that technological advance typically is brought about by a community of practitioners, the authors suggest that cognitive science faces the challenge of developing a sophisticated model of shared cognition and problem solving.

WP 99-1

Johann Peter Murmann, Ernst Homburg. Comparing Evolutionary Dynamics Across Different National Settings: The Case of the Synthetic Dye In

Keywords: Evolutionary Economics, Management and Organization Theory, Industry Evolution, Business History, Cross-national Comparisons, Synthetic Dye Industry.


Empirical investigations of industry evolution have flourished over the last two decades, but with the exception of Carroll and Hannan’s automobile study (1995) no one has examined in systematic fashion whether evolutionary patterns are the same in different social contexts. We present in this paper some striking dissimilarities in patterns of evolution that appear when the unit of analysis is not the entire world, but rather individual countries. These variations in country patterns (we compare Great Britain, France, Germany, U.S.A. and Switzerland) call out for an explanation and raise questions about current models of industry evolution. We identify as causal drivers behind the observed differences in country patterns: The Legal Environment, Availability of Skills, Existing Industrial Infrastructure, Economies of Scale and Scope, Technological Dynamics, and Positive Feedback Mechanisms. The article is now published in the Journal of Evolutionary Economics, Vol. 11 (2001) 177-205. 

You can download this paper here.

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