The Economics of Convention

  title={The Economics of Convention},
  author={H. Peyton Young},
The purpose of conventions is to coordinate people's expectations in economic and social interactions that have multiple equilibria. Conventions often emerge endogenously from the accumulation of many precedents, a process that can be modeled as a stochastic dynamical system. The theory leads to specific predictions about the ways in which conventions form and are displaced, and identifies key properties of conventions that are most likely to withstand the test of time. The theory is… CONTINUE READING

Figures from this paper.


Publications referenced by this paper.

Evolution and Equilibrium Selection in Repeated Lattice Games," preprint

An, Y Mark, Nicholas M. Kiefer
  • Cornell University,
  • 1993

Ian-ni, "Local Learning on a Torus,

Anderlini, Luca, Antonella
  • 1993

Interaction Structure and the Stability of Conventions," preprint

Goyal, Sanjeev, Maarten Janssen
  • Erasmus University,
  • 1993

Learning and Adaptation Processes in Games with Local Interaction Structures," preprint

Berninghaus, K Siegfried, Ulrich Schwalbe
  • University of Mannheim,
  • 1992

Left is Right on the Road: The History of Road Traffic Regulations,

Hamer, Mick
  • New Scientist, December
  • 1986