Epictetusian rationality and evolutionary stability

An economic interpretation of Epictetus’s precept of ‘Taking away aversion from all things not in our power’ consists of extending the symmetric factor of the preference relation beyond its boundaries under non-ethical preferences, so as to yield indifference between outcomes differing only on things outside one’s control. This paper examines the evolutionary dynamics of a population composed of Nash agents and Epictetusian agents matched randomly and interacting in the prisoner’s dilemma game. It is shown that when the evolutionary dynamics is driven by material pay-offs, the Nash type is an ESS under perfect random matching, whereas either the Nash or the Epictetusian type can be an ESS under imperfect random matching. However, when selection is driven by utility pay-offs, the Nash type can never be an ESS, and the Epictetusian type is an ESS if the matching process exhibits a sufficiently high degree of assortativity.