Entrepreneurship, Evolution and the Human Mind

Citation

Loasby B (2007) Entrepreneurship, Evolution and the Human Mind. In: Cantner U & Malerba F (eds.) Innovation, Industrial Dynamics and Structural Transformation: Schumpeterian Legacies. Berlin, Germany: Springer, pp. 29-47. http://link.springer.com/chapter/10.1007/978-3-540-49465-2_3

Abstract
Schumpeterian ‘development from within' requires imagination, skill and motivation; so does Cattaneo's ‘psychology of wealth'. Neither can be encompassed by models that rely on deductive rationality, but are twin products of Knightian uncertainty, where the absence of demonstrably correct procedures allows individuals to create domain-limited mental structures. The human mind (as studied by Smith, Marshall and Hayek), is a product of biological evolution which supports the evolution of knowledge and of economic systems. These are non-biological processes; both require (fallible) bounds to uncertainty, which are provided by (evolving) formal and informal organisation, including institutions.

Keywords
Intelligence;Uncertainty;Imagination;Domain-limitation;Organisation

People

Professor Brian Loasby

Emeritus Professor, Economics