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on Heterodox Microeconomics |
| By: | Harald Uhlig (University of Chicago - Department of Economics) |
| Abstract: | This paper is a non-technical and somewhat philosophical essay, that seeks to investigate the relationship between economics and reality. More precisely, it asks how reality in the form of empirical evidence does or does not influence economic thinking and theory. In particular, which role do calibration, statistical inference, and structural change play? What is the current state of affairs, what are the successes and failures, what are the challenges? I shall tackle these questions moving from general to specific. For the general perspective, I examine the following four points of view. First, economics is a science. Second, economics is an art. Third, economics is a competition. Forth, economics is politics. I then examine four specific cases for illustration and debate. First, is there a Phillips curve? Second, are prices sticky? Third, does contractionary monetary policy lead to a contraction in output? Forth, what causes business cycles? The general points as well as the specific cases each have their own implication for the central question at hand. Armed with this list of implications, I shall then attempt to draw a summary conclusion and provide an overall answer. |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:bfi:wpaper:2011-006&r=hme |
| By: | Viktor J. Vanberg |
| Abstract: | The claim that the Darwinian paradigm of blind-variation-and-selective-retention can be generalized from the biological to the socio-cultural realm has often been questioned because of the critical role played by human purposeful design in the process of cultural evolution. In light of the issue of how human purposes and evolutionary forces interact in socio-economic processes the paper examines F.A. Hayek's arguments on the "extended order of the market," in particular the tension that exists between his rational liberal and his agnostic evolutionary perspective. |
| Date: | 2011–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2011-19&r=hme |
| By: | John Hatgioannides (City University); Marika Karanassou (Queen Mary, University of London and IZA) |
| Abstract: | In this paper we aim to trace the roots of the ongoing economic mayhem and to unmask the chorus of the tragedy which plays on the world stage. The main thesis of our work is that, despite the triumphant rhetoric praising the merits of perfect competition, the global fields of the dysfunctional market system have mushroomed in what we call <i>Warrant Economics for the Free-Market Aristocracy</i>. Warrant Economics unfolds in two symbiotic tenets that constitute the subtle architecture of the neoliberal edifice: (i) the systemic creation and preservation of inequality via Call-Put policy options, and (ii) the systemic exploitation of inequality via novel and toxic forms of securitisation. In effect, the power structure of insiders' capitalism that we describe, through the costless appropriation of an intricate cobweb of Call-Put structures, has distorted competition and accelerated economic concentration. We view the income distribution effect, which favours the top 1%, and the business concentration effect, which gravitates competition towards oligopolistic/monopolistic industries, as the two sides of the Warrant Economics coin. We argue that the Warrant Economics state of capitalism has been legitimised by a degenerating research programme blossomed under the fallacy that economics is the "physics of society". In this faculty of thought, we perceive the Great Recession as a symptom of Warrant Economics, rather than as a tsunami-like event. |
| Keywords: | Warrant Economics, Call-Put policy options, Securitisation, Monopoly, Income distribution, Great Recession, Sovereign debt |
| JEL: | E66 G01 G10 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:qmw:qmwecw:wp686&r=hme |
| By: | Arthmar, Rogério; Cinelli, Carlos Leonardo Kulnig |
| Abstract: | This paper goes through the main classical authors’ positions on the virtues and the limitations of both competition and socialism. The first section retrieves the evolution of socialistic ideas in England until the first half of the nineteenth century, highlighting Owen’s thesis. After that, Smith, Bentham, James Mill and Ricardo’s comments on the equality of incomes, the worker’s condition and private property are presented. The third section rescues some elements in Stuart Mill’s early intellectual formation along with his debate with Thompson over the cooperative system in the London based owenite society. The fourth section covers others influences on Stuart Mill’s social thought, as well as his more moderate reflections on the possible points of conflict or convergence between socialism and individual liberty. Then, some final remarks are made. |
| Keywords: | economia clássica; concorrência; socialismo; liberdade |
| JEL: | B10 B12 B15 |
| Date: | 2011–12–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35528&r=hme |
| By: | Michael Wohlgemuth |
| Abstract: | Is Friedrich von Hayek in some specific, perhaps paradoxical, way a "classical liberal paternalist"? My answer will be an unsatisfying "yes and no" depending not only on my interpretation of Hayek, but also on the manifold interpretations one can give to the concepts of paternalism and classical liberalism (or, indeed: liberty). I start with an interpretation of Hayek’s account of "modernity". Here, I hint at a first potential paradox in the form of a "magic triangle" composed of (a) Hayek’s praise and explanation of the evolutionary emergence of the spontaneous order of the market and civil society, (b) Hayek’s fierce opposition to modernist thinking and the fatal conceit of rationalist constructivism and (c) Hayek’s gloomy visions of politics, legislation, or public choice. Next, I shortly distinguish various dimensions of paternalism and confront these with Hayek’s classical liberalism. In the following parts, I offer a brief account of behavioral "anomalies" of public choices that are analogous to, and even more harmful than, those used as legitimizations of "libertarian paternalism" in the private realm. I end up with a qualified claim that at least in the realm of potentially self-damaging collective choices, Hayek might be called a (classical liberal) "paternalist". |
| Date: | 2011–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2011-22&r=hme |
| By: | Pelger, Ines |
| Abstract: | This paper analyzes gender differences in the investment activity of German small and medium sized enterprises (SMEs). The empirical analysis is carried out on a sample of firms drawn from the KfW Mittelstandspanel, a representative survey of German SMEs for the period from 2003 to 2009. We find evidence that female-owned firms are less likely to invest and if they invest, then their average investment rate is lower. These differences cannot entirely be explained by firm or owner characteristics. Furthermore, women’s investment is less sensitive to cash flow, which indicates that it is unlikely that their lower investment is driven by difficulties in acquiring external finance. An analysis of stated investment goals reveals that women have different preferences and attitudes towards investment. They indicate to a lesser extent aspiring and growth-orientated investment goals like sales increase, innovation/R&D or implementation of new products. |
| Keywords: | Gender Economics; Female Entrepreneurship; Investment |
| JEL: | G11 J16 L26 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:12526&r=hme |
| By: | Pelger, Ines |
| Abstract: | This paper provides the first evidence on gender differences in investment financing, credit application and credit denial rates in Germany. The empirical analysis is carried out on a sample of firms drawn from the KfW Mittelstandspanel, a representative survey of German SMEs for the period from 2003 to 2009. Our results suggest that in female-owned firms the share of internal capital in investment financing is higher and the share of external funds is lower than for male-owned firms. An analysis of the supply- and demand-side on the credit market shows that women are not more likely to be denied credit but the probability that they apply for credit is on average lower. Yet, this gender difference in the probability of credit application is only evident when considering firms with negative or neutral sales expectations. There is no significant gender difference in credit application rates of firms with positive sales expectations. |
| Keywords: | Gender Economics; Female Entrepreneurship; Investment Financing |
| JEL: | G11 J16 L26 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:12524&r=hme |
| By: | Fabrizio Botti; Marcella Corsi; Carlo D'Ippoliti |
| Abstract: | Active ageing strategies have so far strongly focussed on increasing senior workers employment rates through pension reforms to develop incentives to retire later on the one hand, and labour market policies on the other hand. Most measures are based on the dominant male trajectory of work and retirement and they are not explicitly gender mainstreamed. By contrast, a gender approach would prove fundamental to the labour market inclusion of elderly people, because in old age women suffer from the accumulated impact of the barriers to employment they encountered during their lifetime (e.g. repeated career breaks, part-time work, low pay and gender pay gap). Moreover, it appears that some pension reforms, by mandating a higher postponement of retirement and by establishing tighter links between formal employment and pension benefits may negatively affect the already high risk of poverty for elderly women. Active ageing strategies have so far strongly focussed on increasing senior workers employment rates through pension reforms to develop incentives to retire later on the one hand, and labour market policies on the other hand. Most measures are based on the dominant male trajectory of work and retirement and they are not explicitly gender mainstreamed. By contrast, a gender approach would prove fundamental to the labour market inclusion of elderly people, because in old age women suffer from the accumulated impact of the barriers to employment they encountered during their lifetime (e.g. repeated career breaks, part-time work, low pay and gender pay gap). Moreover, it appears that some pension reforms, by mandating a higher postponement of retirement and by establishing tighter links between formal employment and pension benefits may negatively affect the already high risk of poverty for elderly women. |
| Keywords: | Gender differences; Ageing; Pensions; Active labour market policies; Age management |
| JEL: | J14 J16 J71 |
| Date: | 2011–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:dul:wpaper:2013/106179&r=hme |
| By: | Paola Salardi (Department of Economics, University of Sussex) |
| Abstract: | This paper provides a unique analysis of the evolution of gender and racial occupational segregation in Brazil from 1987-2006. Drawing on a novel dataset, constructed by harmonizing national household data over twenty years, the paper provides extensive new insights in the nature and evolution of occupational segregation over time, while also providing important new insights into the forces driving these changes. The results presented here expand upon existing research in the developing world in several directions. First, the new dataset constructed for this study allows the analysis to cover a longer time period than has previously been possible. Second, the analysis explores both gender and racial segregation side by side. Third, all of the analysis is conducted for the labour market as a whole, and disaggregated into the formal, informal and self-employed labour markets. Fourth, the paper decomposes the key driving forces that lie behind trends in occupational segregation. The paper presents three major findings: first, gender segregation is always considerably greater than racial occupational segregation, but racial segregation has been more persistent over time and has several features that make it comparatively worrisome; second, while occupational segregation is declining by both gender and race, the decline has been greater in the formal labour market. Third, the decomposition of segregation measures over time reveals that changes in the internal gender and racial composition of occupations have driven improvements over time. These important differences between formal and non-formal labour markets provide preliminary insights into the possible importance of formal labour market policies and institutions in shaping outcomes. |
| Keywords: | Brazil, Gender, Race, Occupational Segregation, Informality. |
| JEL: | J15 J16 J71 O17 O54 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:sus:susewp:3011&r=hme |
| By: | Halkos, George |
| Abstract: | This paper discusses the development of environmental economics from the Industrial Revolution in Europe to today. Specifically, it comments on the general similarities and differences between the representatives of the schools of economic thought concerning the environment. Among others, the issues of scarcity of natural resources, of population growth as well as the limits to growth are discussed and the various views are presented. The paper also comments on the trends of environmental, evolutionary and ecological economics. |
| Keywords: | Naturla resource scarcity; limits to growth; environmental economics |
| JEL: | N54 B12 B14 O13 B13 N53 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35580&r=hme |
| By: | João Carlos Lopes |
| Abstract: | An increase in the unemployment rate is one of the most serious consequences of macroeconomic crises. In Portugal, the impact of the deep recession of 2009 has been particularly strong. In this paper, after quantifying this macroeconomic problem, an input-output approach is used in order to identify the high employment generating (or destructing) industries. This approach is particularly interesting because it considers not only the direct flows of job creation and destruction, but also the employment changes attributable to the indirect and induced effects of interindustry connections (the flows of intermediate inputs’ supply and demand). Using the so-called hypothetical extraction (or “shut-down of industry”) method and the employment and input-output data of the Portuguese economy, the key sectors in terms of multipliers, elasticities and the creation of jobs are identified. The empirical results of this paper can be useful in improving the policy responses to the crisis and implementing the most appropriate measures to stimulate the economy. |
| Keywords: | input-output analysis; hypothetical extraction; employment Classification-C67, D57 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:ise:isegwp:wp242011&r=hme |
| By: | Jean-Claude Barbier (Centre d'Economie de la Sorbonne) |
| Abstract: | What has been analysed in France mainly under the term "précarité de l'emploi" over the past 30 years was mostly dealt with differently in other countries (atypical, non-standard employment). Research on these issues dates back to the 1970s in sociology and institutional economics. More recently some political scientists have endeavoured to link up the labour market theme with developments in systems of social protection and they are talking about "dualism" and "dualization". Despite the constant intellectual investment put into the topic, it is striking that indicators for comparative measurement of the phenomenon have remained rather unsophisticated, as the basic opposition between what Eurostat names "temporary contracts" and "open-ended contracts". On the other hand, because of the spreading of the effects of work and employment flexibilisation into new countries, new categories are appearing since the early 2000s (Prekariat, vulnerable workers, and even "precarity"). |
| Keywords: | Precariousness, non-standard work, internal labour markets, atypical employment, dualization, Europeanization. |
| JEL: | J2 J80 J82 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:11078&r=hme |
| By: | Pollitt, M. G.; Shaorshadze, I. |
| Abstract: | This article explores how behavioural economics can be applied to energy and climate policy. We present an overview of main concepts of behavioural economics and discuss how they differ from the assumptions of neoclassical economics. Next, we discuss how behavioural economics applies to three areas of energy policy: (1) consumption and habits, (2) investment in energy efficiency, and (3) provision of public goods and support for pro-environmental behaviour. We conclude that behavioural economics seems unlikely to provide the magic bullet to reduce energy consumption by the magnitude required by the International Energy Agency's “450” climate policy scenario. However it offers new suggestions as to where to start looking for potentially sustainable changes in energy consumption. We believe that the most useful role within climate policy is in addressing issues of public perception of the affordability of climate policy and in facilitating the creation of a more responsive energy demand, better capable of responding to weather-induced changes in renewable electricity supply. |
| JEL: | D03 D10 Q40 Q58 |
| Date: | 2011–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1165&r=hme |
| By: | L. Randall Wray |
| Abstract: | This paper takes off from Jan Kregel's paper "Shylock and Hamlet, or Are There Bulls and Bears in the Circuit?" (1986), which aimed to remedy shortcomings in most expositions of the "circuit approach." While some "circuitistes" have rejected John Maynard Keynes's liquidity preference theory, Kregel argued that such rejection leaves the relation between money and capital asset prices, and thus investment theory, hanging. This paper extends Kregel's analysis to an examination of the role that banks play in the circuit, and argues that banks should be modeled as active rather than passive players. This also requires an extension of the circuit theory of money, along the lines of the credit and state money approaches of modern Chartalists who follow A. Mitchell Innes. Further, we need to take Charles Goodhart's argument about default seriously: agents in the circuit are heterogeneous credit risks. The paper concludes with links to the work of French circuitist Alain Parguez. |
| Keywords: | Circuit Approach; Liquidity Preference; Banks as Ephor of Capitalism; J. M. Keynes; J. A. Schumpeter; A. Parguez; J. A. Kregel; Chartalist; Modern Money Theory; State Money; Credit Money; Default |
| JEL: | B2 B24 B25 B31 B51 B52 E11 E12 E41 E43 E51 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_700&r=hme |
| By: | Tomoko Hashino (Graduate School of Economics, Kobe University); Keijiro Otsuka (National Graduate Institute for Policy Studies) |
| Abstract: | This study finds that the process of evolutionary development of the Kiryu weaving district in Japan from 1895 to 1930 can be divided into the two phases, i.e., Smithian growth based on the inter-firm division of labor using hand looms and Schumpeterian development based on factory system using power looms. Weaving manufacturers-cum-contractors led Smithian growth by organizing sub-contracts with out-weavers in rural villages among others, thereby contributing to the steady growth in production. Newly emerged joint stock firms played a role of genuine entrepreneurs by realizing significant scale economies and transforming the traditional weaving district into a cluster of large modern factories. |
| Keywords: | industrial district, Smithian growth, Schumpeterian development, weaving industry, 20th century Japan |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:koe:wpaper:1121&r=hme |
| By: | Chakraborty, Ratula (Norwich Business School, University of East Anglia); Dobson, Paul (School of Business and Economics, Loughborough University); Seaton, Jonathan S. (Corresponding Author, Department of Economics, University of Warwick,); Waterson, Michael (Department of Economics, University of Warwick, JEL classification: L16 ; L81 ; E31 Key words: Pricing behaviour ; supermarket prices ; inflationary behaviour ; price indexes) |
| Abstract: | We investigate micro pricing behaviour in groceries (the UK’s most important consumer market) over eight years including the inflationary period of early 2008. We find behaviour sharply distinguished from most previous work, namely that overall basket prices rise but more individual prices fall than rise! This is consistent with retailers obscuring the fact of rising basket prices. We employ a significant new source of data that captures cross-competitor interplay in prices at a very detailed level. Unusually but importantly, our work takes into account that consumers buy baskets of goods, rather than individual products, when shopping at supermarkets. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:975&r=hme |
| By: | Antonio Bariletti (University of Cassino) |
| Abstract: | Il lavoro ha carattere descrittivo-interpretativo e cerca di rispondere alla domanda: “Di che cosa parliamo, quando parliamo di (dei) beni creativi…?”. Qui presento le prime due parti, delle quattro in cui il lavoro è previsto. Nella prima discuto un primo modo in cui Scitosvky ,in Scitovsky and Scitovsky 1959, individua e sostiene la rilevanza della “creatività” nello sviluppo industriale moderno; nella seconda, espongo ed esamino la nozione originaria di beni creativi secondo Hawtrey , 1926. Questo mi servirà per comparare (nelle restanti due parti) aderenza e divergenze tra la posizione originaria di Hawtrey e quelle di Scitovsky del 1959 e delle due edizioni di The Joyless Economy del 1976 e del 1992; e anche di altri autori che in tempi più recenti possono aver fatto uso dello stesso termine (ma forse non della stessa categoria analitica). |
| Date: | 2011–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:css:wpaper:2011-09&r=hme |
| By: | Hoffmann, Jana (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Damelang, Andreas (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Schulz, Florian (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "This article examines if occupations contribute to social closure by their structural characteristics. For this purpose the four structural indicators occupational specificity, standardization by training regulation, voluntary certification by private educ-tional providers and representation by an occupational association were created on the basis of the 'Berufsordnungen' of the 'KldB88'. The main question is how these structural traits restrict occupational mobility of graduates of an apprenticeship in the 'dual system'. From a theoretical perspective it is expected that a high manifestation of these indicators goes along with a stronger social closure of the particular occupation and so switching into such an occupation is more difficult. The empirical results show that three structural variables indicate the predicted tendency: the access to occupations which are standardized by a training regulation or certified by private educational providers is more difficult. A higher manifestation of occupational specificity also decreases the opportunities to switch into such an oc-cupation. Contrary to the supposed correlations is the variable occupational associations - it has a positive effect on occupational mobility. The differentiation into three occupational areas showed the same results for technical and service occupations. However, in the production sector the effects of occupational specificity and occupational associations differed." (Author's abstract, IAB-Doku) ((en)) |
| JEL: | B52 J62 |
| Date: | 2011–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabfob:201109&r=hme |
| By: | Giancarlo Bertocco (Department of Economics, University of Insubria, Italy) |
| Abstract: | The current crisis in the global economy is considered on a par with the Great Depression of the 1930s. We can therefore ask whether the crisis will lead economists to revise the mainstream theory. The first result presented in this paper is to show that the traditional theory does not permit the formulation of a coherent explanation of the causes of the crisis because it uses concepts that are not coherent with the dominant theory of finance. The second result is to show that these concepts are coherent with a theory of finance that can be elaborated on the basis of the lesson of Schumpeter, Keynes and Minsky. |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:ins:quaeco:qf1116&r=hme |
| By: | Ron Boschma; Pierre-Alexandre Balland; Dieter Kogler |
| Abstract: | In this paper, we analyze the geography of knowledge spillovers in biotech by investigating the way in which knowledge ties are organized. Following a relational account on knowledge spillovers, we depict knowledge networks as complex evolving structures that build on pre-existing knowledge and previously formed ties. In economic geography, there is still little understanding of how structural network forces (like preferential attachment and closure) shape the structure and formation of knowledge spillover networks in space. Our study investigates the knowledge spillover networks of biotech firms by means of inter-organizational citation patterns based on USPTO biotech patents in the years 2008-2010. Using a Stochastic Actor-Oriented Model (SAOM), we explain the driving forces behind the decision of actors to cite patents produced by other actors. Doing so, we address directly the endogenous forces of knowledge dynamics. |
| Keywords: | knowledge spillovers, network structure, patent citations, biotech, proximity |
| JEL: | B15 R11 R12 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1120&r=hme |
| By: | Estrada, Fernando |
| Abstract: | This paper proposes an interpretation theoretical model of the Aufbau of Rudolf Carnap, this interpretation contributes to upgrade the project original carnapian, in the sense of conferring to the constitutional program of construction logical, less committed analytic equipment with an ontology or clearly defined epistemology. The setting in phenomenal logical reconstruction practice is elaborated for the visual field as a model whose potential user is a fellow ideal percipient, and, a subject epistemic that operates in the same way that a scheduled computer when he has been given basic phenomenal information and some algorithms logical. |
| Keywords: | Rudolf Carnap; Information; economy phenomenological; History; philosophy of science – structuralism program |
| JEL: | B10 B40 B1 A1 A12 Z10 B4 D80 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35452&r=hme |
| By: | Théret, Bruno |
| Keywords: | Keynésianisme; Libertarianisme; Monnaie; |
| JEL: | B5 E4 B2 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ner:dauphi:urn:hdl:123456789/7629&r=hme |
| By: | Giancarlo Bertocco (Department of Economics, University of Insubria, Italy) |
| Abstract: | Rajan has earned a well-deserved reputation for having been one of the few to have hypothesized in a famous paper presented at the 2005 Jackson Hole conference that a disastrous financial crisis could have occurred. The key thesis put forward by Rajan was that the radical changes that had taken place over the previous decades rendered the economic system more fragile in that they induced the financial system to create a high amount of risk. The aim of this paper is to show: i) that Rajan’s thesis is not coherent with the mainstream theory according to which finance does not create risk; ii) that a meaningful theory capable of explaining the meaning of the elements used by Rajan to assert that finance creates risk can be elaborated on the basis of the lesson of Keynes and Schumpeter |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:ins:quaeco:qf1115&r=hme |