by Edward Peter Stringham, Hackley Endowed ChairSchool of Business and Economics Fayetteville State University
Can the theory of evolution be applied to topics other than the evolution of species?French economist Alain Marcaino argues that both Charles Darwin and Nobel prizewinning economist Friedrich Hayek refer to the same theory of human nature, which isborrowed from the founding fathers of political economy, Hume and Smith. This essay provides support for the idea that theory of evolution can be used to describe many important market institutions. Markets involve people who are often consciously choosingvarious business practices so the analogy between evolution in markets and evolution innature has some importance differences. But just as different species vary or adapt so dodifferent economic practices. Those that are more suited for their time and place willbecome more successful and will be copied and replicate. The history of stock marketsillustrates this point well
