Abstract
We assess the benefits and challenges that rule-based economics implies for theory building and empirical research. Benchmarking empirical results drawn from an original study presented earlier against evidence from inquiries relying on more traditional approaches it can be shown that rule-based analysis implies four important advantages: (1) the distinction of rules from operations enables a more clear-cut analysis and helps to exclude false positives, (2) the distinction of sub-groups of agents allows conducting more profound analysis, (3) the transdisciplinary nature of rule-based economics enables the testing of a more complete set of influencing factors, and (4) the evolutionary perspective secures the inclusion of dynamic phenomena.
At the same time, rule-based economics implies a number of challenges such as intricacies linked to the distinction of rules from operations, data availability issues and a considerably larger workload. In spite of these challenges, rule-based economics offers potential for superior research outcomes if the methodological guidance is duly followed.
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Notes
- 1.
Also failing to include a suitable control variable for the urban-rural divide, the respective dummy eventually produced significant parameter estimates as it accidentally proved a strong covariate of the missing control.
- 2.
As Masuda had to rely on a rather weak argument based on difference in significance levels for his parameter estimates, his evidence has to be considered much less robust.
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Blind, G.D. (2017). Rule-Based Economics in Empirical Practice: Effective Tool for Theory Building. In: The Entrepreneur in Rule-Based Economics. Economic Complexity and Evolution. Springer, Cham. https://doi.org/10.1007/978-3-319-62779-3_16
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DOI: https://doi.org/10.1007/978-3-319-62779-3_16
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