A Study On Creation And Evolution Of Spontaneous Extended Institution Based On Individual Cognition Adjustment

In economic & social system, there are lots of spontaneous extended institutions such as customs and conventions which are created by the non-cooperate players. This kind of institution, playing an important role in economic & social system, is a key endogenous variable which determine the economic performance and economy evolution. Spontaneous extended order is a complicated multi-dimension system. Its creation and evolution are effected by many factors. Understanding the evolution of institution depends on having the multi-dimension system project into a sub or single space which has lower dimension and reflects essential attribute of the system. We choose cognition as the pivotal dimension, and take the spontaneous extended order as a self-maintenance system of common cognition among individuals. From this point, we study the creation, equilibrium and evolution of the spontaneous extended institution. Our questions include:how to explain the cognitive attribute of institution; how can individual cognition become common perceive based on the interaction among players; and what are the effects that cognition adjustments have made on the equilibrium and evolution of institution?Around these issues, this paper constructs an analysis framework of "cognitive adjustment-behavior interaction-institution creation" based on cognitive institutionalism. Using game theory and other analytical tools, the main conclusion of this dissertation are presented in five aspects as follows:Firstly, we examine the cognitive foundation of system. The creation and change of the individual cognition and common cognition are simplified according to the analysis framework. After that, we illustrate the cognitive attribute and character the endogenous creation mechanism of institution.Individual cognition is formed by processing the external signals based on agents' identifying, behaving and learning ability. According to the match degree of cognition and scene signals, agents start-up rule-abeyance or target-motivation cognition. These two kinds of cognition play an important role in the equilibrium and evolution of system. Based on individual cognition, the creation of common cognition and convention is evolved in the same process. The common expectation to environment signals is formed by the interaction among individuals.Secondly, we construct the equilibrium model of institution based on cognition. Under different decision scenes, we construct the cognitive game model of institution according to the cognition heterogeneity. Under target-motivation rule, the selfish agent will engender the rational cognition about the un-equilibrium behavior, and then the order which is the outcome of sub-game perfect equilibrium will be created. Under the rule-abeyance cognition, the observer will form the expectation to the variant behavior, and then the institution which is the outcome of evolutionary game will be created. If individuals'strategies will change randomly or be modulated intentionally, the transferred cognition may facilitate the dynamics of system.Thirdly, we analyze the system evolution based on cognition. We advance the cognitive mechanism of institution evolution and the general analysis model. And then we speculate the concrete model on the evolution of system under different distribution of group cognition.We use replicator dynamics model to explain the evolution of institution according to the evolution of group cognition. When the change of system environment induces cognitive crisis, varieties of cognition are completing in an obvious scale. Some kinds of cognition become dominant, and the cognitive equilibrium will be recovered. In the groups which have the same cognition, the equilibrium of evolution will be achieved at the point that the adjustment effect of rule-abeyance equals the effect of target-motivation. But from the viewpoint of cognitive payoff, even the profit of rule-abeyance cognition is a little less than the target-motivation cognition, the rule-abeyance cognition will be handed down from generation to generation in groups. If the number of agents who transfer cognition breakthrough the equilibrium, the group cognition will be converged to innovation or conservation area. The inducement explains the path dependence in the evolution of conventions. In the groups which have different cognition, the institution change is affected by the primary distribution of cognition in groups. If we modify the payoff structure of interaction, the direction of system evolution will be revised.Fourthly, we explain the co-existence and change of institutional diversity based on the cognitive space according to the evolution analysis framework. Under the situation of opening and reform, individual restart the traditional cognition of relationship, and start-up the utilitarian target-motivation cognition affected by the economic consideration. Under the two kinds of cognition, the social communication models have changed from the universal contract to the special utilitarian interaction.Fifthly, we have positive research and simulation experiment, taking the evolution of commons co-governance model for example.The marginal effect to the creation of institution is obvious. In group cognition, residential haven't achieve the common cognition on the co-governance of commons. The individual cognition of the decision on public affairs mostly comes from the authority in community. Therefore, the creation of co-governance is blocked by the individual and group cognitions. Cognition adjustment based on payoff enforcement and cognitive learning is helpful to fortify the attraction of "supply" strategy, enhance the probability that agent choose the strategy, and increase the agents'profit. The cognition adjustment is able to overcome the supply dilemma of commons, and foster the creation of institution in commons co-governance.