ABSTRACT
Of the three evolutionary processes of variation, competition, and selection, the analysis of the first is the least developed in economic theory. In this chapter I will formulate an evolutionary analysis of behavioral variation. This analysis requires an explanation for such strategic changes in behavior as innovation, technological change, institutional change, and other behavioral variations in which economic agents change not only their activities but also their structure and capacities. Although the examples that I will use will be drawn largely from contemporary capitalism, I intend the framework to be useful in application to behavior in other systems.
