Working Paper: CEPR ID: DP8377
Authors: Oded Galor; Stelios Michalopoulos
Abstract: This research suggests that the evolution of entrepreneurial spirit played a significant role in the process of economic development and the dynamics of inequality within and across societies. The study argues that entrepreneurial spirit evolved non-monotonically in the course of human history. In early stages of development, risk-tolerant, growth promoting traits generated an evolutionary advantage and their increased representation accelerated the pace of technological progress and the process of economic development. In mature stages of development, however, risk-averse traits gained an evolutionary advantage, diminishing the growth potential of advanced economies and contributing to convergence in economic growth across countries.
Keywords: evolution; growth; natural selection; risk aversion; technological progress
JEL Codes: J11; J13; O11; O14; O33; O40
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| risk-tolerant traits (D81) | technological advancement (O33) |
| risk-tolerant traits (D81) | economic growth (O49) |
| risk aversion (D81) | economic growth (O49) |
| entrepreneurial traits among lower-income individuals (L26) | income inequality (D31) |