Santa Fe Institute

About: Santa Fe Institute is a nonprofit organization based out in Santa Fe, New Mexico, United States. It is known for research contribution in the topics: Population & Context (language use). The organization has 558 authors who have published 4558 publications receiving 396015 citations. The organization is also known as: SFI.

Coordinated Punishment of Defectors Sustains Cooperation and Can Proliferate When Rare

Abstract: Because mutually beneficial cooperation may unravel unless most members of a group contribute, people often gang up on free-riders, punishing them when this is cost-effective in sustaining cooperation. In contrast, current models of the evolution of cooperation assume that punishment is uncoordinated and unconditional. These models have difficulty explaining the evolutionary emergence of punishment because rare unconditional punishers bear substantial costs and hence are eliminated. Moreover, in human behavioral experiments in which punishment is uncoordinated, the sum of costs to punishers and their targets often exceeds the benefits of the increased cooperation that results from the punishment of free-riders. As a result, cooperation sustained by punishment may actually reduce the average payoffs of group members in comparison with groups in which punishment of free-riders is not an option. Here, we present a model of coordinated punishment that is calibrated for ancestral human conditions and captures a further aspect of reality missing from both models and experiments: The total cost of punishing a free-rider declines as the number of punishers increases. We show that punishment can proliferate when rare, and when it does, it enhances group-average payoffs.

How markets slowly digest changes in supply and demand

Abstract: Publisher Summary This chapter discusses the new approach to the classic problem of tâtonnement —the dynamic process through which markets seek to reach equilibrium. The foundation of this approach is based on several empirical observations about financial markets. The most important of which is long memory in the fluctuations of supply and demand. This is exhibited in the placement of trading orders and corresponds to long-term, slowly decaying positive correlations in the initiation of buying versus selling. It is observed in all the stock markets studied so far at very high levels of statistical significance. It appears that the primary cause of this long memory is the incremental execution of large hidden trading orders. The fact that the long memory of order flow must coexist with market efficiency has a profound influence on price formation, causing dynamic adjustments of liquidity that are strongly asymmetric between buyers and sellers. This has important consequences for market impact. This work has also important consequences about the interpretation and effect of information in financial markets. In particular, the explanation for market impact is that the shape of the impact function is determined by differences in the information content of trades.

Structure of growing social networks.

Abstract: We propose some simple models of the growth of social networks, based on three general principles: (1). meetings take place between pairs of individuals at a rate that is high if a pair has one or more mutual friends and low otherwise; (2). acquaintances between pairs of individuals who rarely meet decay over time; (3). there is an upper limit on the number of friendships an individual can maintain. Using computer simulations, we find that models that incorporate all of these features reproduce many of the features of real social networks, including high levels of clustering or network transitivity and strong community structure in which individuals have more links to others within their community than to individuals from other communities.

Food webs: reconciling the structure and function of biodiversity

Abstract: The global biodiversity crisis concerns not only unprecedented loss of species within communities, but also related consequences for ecosystem function. Community ecology focuses on patterns of species richness and community composition, whereas ecosystem ecology focuses on fluxes of energy and materials. Food webs provide a quantitative framework to combine these approaches and unify the study of biodiversity and ecosystem function. We summarise the progression of food-web ecology and the challenges in using the food-web approach. We identify five areas of research where these advances can continue, and be applied to global challenges. Finally, we describe what data are needed in the next generation of food-web studies to reconcile the structure and function of biodiversity.