Journal of Evolutionary Economics

, Volume 21, Issue 5, pp 817–841 | Cite as

Internal selection and market selection in economic Genetic Algorithms

  • Sylvie GeisendorfEmail author
Regular Article


Genetic algorithms have been established as an alternative to neoclassical optimization for the illustration of economic agents’ behavior. Critics however, doubt they depict the particularities of social evolution, because they fail to describe intentional behavior. The current paper argues that advocates as well as critics of the procedure have overlooked the crucial necessity to distinguish between internal and external selection in the economy and to include both in economic Genetic Algorithms. The paper claims that such a differentiation will allow the model to depict intentional decisions as well as market selection and help to understand the effects of bounded rationality. It illustrates this point with a brief example modeled after the new-versus-new competition between lean-burn engines and catalysts in the 70th.


Genetic Algorithms Internal selection Intentionality External selection Bounded rationality Economic evolution 



The paper has much benefited from the comments of two anonymous referees. Particularly one of them detected several mistakes and gave useful advice. I also thank Fank Thesing and Jan Nill for information on the lean-burn modeling example.


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Copyright information

© Springer-Verlag 2010

Authors and Affiliations

  1. 1.Section Environmental and Behavioural EconomicsUniversity of KasselKasselGermany

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