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This chapter discusses the theory and empirics of social interactions, with particular emphasis on the role of social context in individual decisions. It begins by introducing a sequence of models that highlight applications in different empirical social interaction settings, including a simple static model that is used to link social interactions theory with social networks theory, notably random graph theory. A dynamic model, where the social structure accommodates a variety of social interaction motives, is then described and solved as a dynamic system of evolving individual actions. The solution links social interactions theory with spatial econometrics. The chapter examines the econometrics of social interactions in social networks and social learning in urban settings before concluding with a review of the literature on social interactions in economics.

Summarizes the main findings and discusses how social interactions can be used to extend the rational and individual‐centred approach of economists with social norms, bounded rationality, social learning, changing values, and attitudes. The combination of these elements yields new insights about the dynamics and determinants of fertility change. More generally, the book also reveals how the economic approach to individual behaviour can be broadened in order to overcome many of its traditional criticisms.

The evolutionary trajectory from non-human to human forms of social organization involves change from experiential- to relational-based systems of social interaction. Social organization derived from biologically and experientially grounded social interaction reached a hiatus with the great apes due to an expansion of individualization of behaviour. The hiatus ended with the introduction of relational-based social interaction, culminating in social organization based on cultural kinship. This evolutionary trajectory links biological origins to cultural outcomes and makes evident the centrality of distributed forms of information for both the boundary and internal structure of human societies as these evolved from prior forms of social organization.

This chapter looks at a variety of ethnographic cases to show how recognition and intentionality are elaborated and brought into focus in different cultural contexts. It studies the concept of dewa, which seems to thematize the role that other people play in one's own sense of self. This concept, however, is not simply just one way of describing a universal feature of interaction. Once crystallized as an object of reflections, something that Sumbanese consciously know about the world and can connect to other things they know about their world, it also guides them as they purposefully undertake ethical actions. Indeed, the chapter argues that if recognition and intentionality are basic features of all social interaction anywhere, they also serve as affordances for dealing with, or reflecting on, particular ethical questions that concern a given community.

The topics in this book are derived from work done at the conference The Economy as an Evolving Complex System III, held at the Santa Fe Institute in November 2001. To a great extent, the original motivation for the Economics Program revolved around the belief that economic research could benefit from an injection of new mathematical modes and new substantive perspectives on human behavior. This book deals with four important themes concerning the following: the nature of learning; the identification and analysis of pattern in individual and aggregate data, primarily in financial markets; the analysis of social interactions; and efforts to use insights from evolutionary theory to understand aspects of individual and social cognition.

This chapter explores what the interactions of individuals and firms in their vicinity and in broader communities reveal about the spatial structure of cities as self-organization by agents. It first introduces a benchmark, the Alonso–Mills–Muth model of a city in its bare essentials, and examines its implications for urban density and the associated pattern of land prices in the case with a predetermined center, the central business district (CBD). It then considers the geometry of spatial equilibrium when there is no predetermined center and social interactions are dispersed, along with the location decisions of firms in urban space, monocentric versus polycentric models of the urban economy, and the Lucas–Rossi-Hansberg models of urban spatial structure with productive externalities. It also analyzes neighborhood effects, urban equilibrium when proximity is a conduit for the transmission of job-related information, and the link between choice of job matching and spatial structure.

This chapter examines social interactions in human capital spillovers by focusing on spatial patterns in productivity, wages, and incomes, with particular emphasis on whether spatial concentration causes higher productivity. It begins with a discussion of aggregative spatial measures, such as economic activity at the level of states, regions, and counties in comparison with the smaller scale of cities and their neighborhoods. It then considers the interdependence between spatial interactions and spatial economic activity, the implications of spatial equilibrium for the urban wage premium, and human capital spillovers in microneighborhoods and in synthetic neighborhoods. It also shows how differences in patterns of productivity across locations and at different scales of spatial aggregation may be rationalized in terms of simple models of social interactions.

Rabbinic documents present themselves to some extent as having their root in the oral transmission of information. This chapter attempts to summarize some important aspects of the rabbis' own explanation of this, nowadays treated under the label ‘oral Torah’. It then explores the hermeneutic effect of oral contexts, as well as the constitution of ‘social texts’ in the interaction of several voices in conversation. For the latter, two scenarios are considered: the selective use of an existing text in a discussion setting; and a kind of ‘committee’ meeting in which a record of rabbinic information is created from scratch. The chapter concludes with a critique of the idea that rabbinic texts were shaped by or for oral performance.

Correlations between an understanding of self and other in psychological terms, often referred to as “theory of mind,” and the control of action, often labeled “executive functions,” have been reported and debated. We suggest that claims about such relations rest on a prior assumption that these are two separate, coherent domains and children have stable, measurable abilities in these areas. Examining relevant research, however, indicates variability in a number of ways, suggesting that both social understanding and executive skills are substantiated and develop within the flow of interaction with people and objects. According to our alternative approach to social cognitive development, social understanding develops within social interaction as children learn to talk about situations of shared understanding. We suggest that executive function and social understanding may be interdependent and emerge through the same processes within social interaction.

Shifts the emphasis from individual behaviour in the presence of social interactions to aggregate fertility dynamics. In particular, the chapter considers the implications of using non‐linear models in empirical and theoretical models of social interactions and fertility. We show that with non‐linear models, there may be both low and high contraceptive‐use equilibria rather than just one equilibrium as in linear models. A sustained fertility decline can occur if a population experiences a transition from a low to a high contraceptive‐use equilibrium. These transitions occur at a rapid pace—consistent with the empirical findings on past and present fertility declines—and they are often irreversible once they are initiated.

This chapter focuses on the problem raised by some of the psychological research, the relationship between those processes that work beyond the scope of the individual's awareness, and what it is people actually think they are doing. It shows how empirical research fleshes out the philosophical idea that people act under the guidance of certain descriptions, frames for making sense of what is going on, what kinds of people are acting, and how actions should be judged. These descriptions circulate in a public world, where part of their power derives from their availability to others. They arise in social interactions where these are demanded, accepted, and rejected; here ethics is catalyzed into forms available to other persons. At this point, they are made available for further development, criticism, adoption, or rejection within a larger community.

This chapter examines the location decisions of individuals, with particular emphasis on neighborhood effects in housing markets and how they relate to the role of prices in rationing admission to communities and neighborhoods in market economies. It begins by introducing models of individual location decisions that rely on the characteristics approach in the presence of contextual effects and use individual dwelling units as the object of choice. It then presents examples of sorting models that allow for choice of neighborhood with endogenous contextual effects, followed by a discussion of models and associated empirical results for neighborhood choice and housing as a joint decision that allow for social effects. It also describes models of location decisions, proposed by Thomas Schelling, that take into account the influence of racial preferences and neighbors' reactions. Finally, it looks at hierarchical models of community choice with social interactions.

The cognitive, psychological and sociological mechanisms underpinning complex social relationships among small groups are a part of our primate heritage. However, among human groups, relationships persist over much greater temporal and spatial scales, often in the physical absence of one or other of the individuals themselves. This chapter examines how such individual face-to-face social interactions were ‘scaled up’ during human evolution to the regional and global networks characteristic of modern societies. One recent suggestion has been that a radical change in human sociality occurred with the shift to sedentary and agricultural societies in the early Neolithic. The discussion presents the results of a focused study of the long-term development of regional social networks in the Near East, using the distribution of different forms of material culture as a proxy for the social relationships that underpinned processes of trade, exchange and the dissemination of material culture practices.

The authors offer a multiplicative model that provides a comprehensive framework to place the main findings of the volume. The model is based on the standard ‘expected utility maximization’ model of the economists, which can be applied for understanding election outcomes. The idea is that the voter weights the utility of a given policy by the probability of its being implemented, sums this across the different policies, and then votes for whichever party gives the greatest expected utility. However, Heath, Jowell, and Curtice emphasize the fact that the rational choice model needs to be expanded to include some of the ‘non‐rational’ processes observed in their research such as the possibility that voters’ preferences may be shaped by the political parties and should not to be treated only as independent factors. The model should also be modified to take account of other sorts of processes such as social interaction, social conformity and what the authors have termed the ‘forked‐tail’ effect related to the generalization of the disillusionment from a specific party policy into a general disillusion with the party's competence.