Constitutional Political Economy

, Volume 1, Issue 3, pp 83–107 | Cite as

Conventions: An evolutionary approach

  • Karl Wärneryd


Conventions are social institutions that solve recurrent coordination problems. In normative game theory, coordination games are considered problematic because of the multiplicity of equilibria. From a neoinstitutionalist perspective, however, this multiplicity should be an important part of the explanation of real-world institutions. The paper discusses the evolutionary (or “positive”) game-theoretical approach to the emergence of conventions. I note a precise sense in which conventions may be said to minimize transaction costs, but that they need not be efficient. Example applications to language, money, and the theory of the firm are discussed.


Economic Theory Game Theory Transaction Cost Social Institution Evolutionary Approach 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


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Copyright information

© George Mason University 1990

Authors and Affiliations

  • Karl Wärneryd
    • 1
  1. 1.Department of EconomicsStockholm School of EconomicsStockholmSweden

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