Abstract: Agent-based computational economics (ACE) is the computational study of economies modeled as evolving systems of autonomous interacting agents. Thus, ACE is a specialization to economics of the basic complex adaptive systems paradigm. This study outlines the main objectives and defining characteristics of the ACE methodology, and discusses similarities and distinctions between ACE and artificial life research. Eight ACE research areas are identified, and a number of publications in each area are highlighted for concrete illustration. Open questions and directions for future ACE research are also considered. The study concludes with a discussion of the potential benefits associated with ACE modeling, as well some potential difficulties. Keywords: Agent-based computational economics; artificial life; learning; evolution of norms; markets; networks; parallel experiments with humans and computational agents; computational laboratories. 1

One source of trust for physical trading systems is their physical assets and simply their presence. A similar baseline does not exist for electronic trading systems, but one way in which it may be possible to create that initial trust is through the abstract notion of an institution, defined in terms of norms [19] and the scenes within which (software) agents may play roles in different trading activities, governed by those norms. We present here a case for institutions in electronic trading, a specification language for institutions (covering norms, performative structure, scenes, roles, etc.) and its semantics and how this may be mapped into formal languages such as process algebra and various forms of logic, so that there is a framework within which norms can be stated and proven.

This paper concerns the difficulties associated with establishing a time at which a market will operate. We first describe the experience of several dozen markets and submarkets, from entry-level professional labor markets in the United States, Canada, England, and Japan, to the (American) market for postseason college football bowls. The difficulties these markets have experienced in coordinating the timing of transactions have been decisive in determining how they are organized today. The paper develops a framework in which to address the timing of transactions and the tendency observed in many of these markets for transactions to become earlier and earlier.

The use of the term institution has become widespread in the social sciences in recent years, reflecting the growth in institutional economics and the use of the institution concept in several other disciplines, including philosophy, sociology, politics, and geography. The term has a long history of usage in the social sciences, dating back at least to Giambattista Vico in his Scienza Nuova of 1725. However, even today, there is no unanimity in the definition of this concept. Furthermore, endless disputes over the definitions of key terms such as institution and organization have led some writers to give up matters of definition and to propose getting down somehow to practical matters instead. But it is not possible to carry out any empirical or theoretical analysis of how institutions or organizations work without having some adequate conception of what an institution or an organization is. This paper proposes that those that give up are acting in haste; potentially consensual definitions of these terms are possible, once we overcome a few obstacles and difficulties in the way. It is also important to avoid some biases in the study of institutions, where institutions and characteristics of a particular type are overgeneralized to the set

How do organizations make strategic choices during the time of fundamental institutional transitions such as those sweeping numerous emerging economies? To answer this question, a two-phase model of institutional transitions is developed in this article. I focus on the longitudinal process to move from a relationship-based, personalized transaction structure calling for a network-centered strategy to a rule-based. Impersonal exchange regime suggesting a market-centered strategy. I then identify the points of inflection; predict strategic choices for incumbent, entrepreneurial, and foreign firms; and delineate their performance implications. How do organizations make strategic choices during the time of fundamental and comprehensive institutional transitions? In three decades of research since the publication of Child's (1972) seminal paper, researchers have produced an impressive body of knowledge on how strategic choices are made (Child, 1997; Oliver, 1991). However, most of their studies focus on strategic choices in relatively stable institutional environments. Even when scholars study how organizations respond to institutional transitions, they typically concentrate on changes in one industry while the overall institutional framework of the country remains mostly unchanged. Such industry-specific changes, however, pale in comparison with the massive institutional transitions taking place in many emerging economies. Unfortunately, little is known about how organizations make strategic

[Abstract] Leveraging the recent research interest in emerging economies, this Perspective paper argues that an institution-based view of international business (IB) strategy has emerged. It is positioned as one leg that helps sustain the “strategy tripod ” (the other two legs consisting of the industry- and resource-based views). We then review four diverse areas of substantive research: (1) antidumping as entry barriers, (2) competing in and out of India, (3) growing the firm in China, and (4) governing the

We analyze the determinants of effective legal institutions (legality) using data from 49 countries. We show that the way the law was initially transplanted and received is a more important determinant than the supply of law from a particular legal family. Countries that have developed legal orders internally, adapted the transplanted law, and/or had a population that was already familiar with basic principles of the transplanted law have more effective legality than countries that received foreign law without any similar predispositions. The transplanting process has a strong indirect effect on economic development via its impact on legality.

Cross national data show no association between increases in educational capital due to rising educational attainment of the labor force and the rate of growth of output per worker. This implies the association of growth of educational capital and conventional measures of TFP is large, strongly statistically significant, and negative. While these are the regression results “on average ” (from imposing a constant coefficient) it should be obvious the impact of education has not been the same in every country. There are three explanations for why the impact of education has varied and has so often fallen short of what was hoped. First, perhaps educational has been so low that “years of schooling ” have created no human capital. Second, perhaps the marginal returns to education fell rapidly as supply expanded while demand for educated labor was stagnant. Third, perhaps the institutional environment has been sufficiently perverse that the educational capital accumulation lowered economic growth. Some mix of the three explanations plays a role in most developing countries. 2 Where has all the education gone? 1 To be a successful pirate one needs to know a great deal about naval warfare, the trade routes of commercial shipping; the armament, rigging, and crew size of potential victims;

This paper analyzes how property rights affect the allocation of firms' available resources among different types of assets. In particular, we investigate emp irically for a large number of countries whether firms in environments with more secure property rights allocate available resources more towards intangible assets and consequentially grow faster. We find that improved asset allocation due to better property rights has an effect on growth in sectoral value added equal to improved access to financing arising from greater financial development. The results are robust using various samples and specifications, including controlling for growth opportunities.

A substantial number of people exhibit social preferences, which means they are not solely motivated by material self-interest but also care positively or negatively for the material payoffs of relevant reference agents. We show empirically that economists fail to understand fundamental economic questions when they disregard social preferences, in particular, that without taking social preferences into account, it is not possible to understand adequately (i) effects of competition on market outcomes, (ii) laws governing cooperation and collective action, (iii) effects and the determinants of material incentives, (iv) which contracts and property rights arrangements are optimal, and (v) important forces shaping social norms and market failures.