How trade saved humanity from biological exclusion: an economic theory of Neanderthal extinction

One of the great puzzles in science concerns the rise of early modern humans and the fall of Neanderthals. A number of theories exist, and many support the biological principle of competitive exclusion. But the evidence for such mechanistic theories in which biology is destiny is limited. In response, this paper develops a behavioral model of Neanderthal extinction. We show how the endogenous division of labor and subsequent trading among early modern humans could have helped them to overcome potential biological deficiencies. We discuss the relation between economics and natural selection, and show how trade may partially offset natural selection.