MS#114. Landscape Dynamics and Conspicuous Consumption, 2004 With Dan Friedman To appear, Proceedings of Intern. Symposium on Dynamic Games and Applications, Tucson, Dec. 2004. Subjects: Economics Written: September 28, 2004 Abstract: We study evolutionary games with a continuous space of strategies A. The current state is the distribution F of players over A. The payoff function defines an adaptive landscape for each state. Each player continuously adjusts her strategy in A towards higher ground in the landscape. Consequently the distribution F changes continuously and so the landscape changes, and the players adjust again. Assuming gradient adjustment, this interplay between landscape and state is described by a partial differential equation or, equivalently, by a dynamical system on the infinite-dimensional space F of current states. The paper illustrates these ideas using Veblen's notion of conspicuous consumption, i.e., one's payoff depends on where one's consumption x falls in the current distribution F. For simplicity we take A = [0, 1], and obtain explicit solutions to the landscape dynamics for special cases. Two Propositions characterize the long run and short run dynamics for more general cases. Using the simulation package NetLogo we illustrate both Propositions. [PDF], 13 pages, 1 MB Last revised by Ralph Abraham