nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2012‒01‒18
fourteen papers chosen by
Frederic S. Lee
University of Missouri-Kansas City

  1. "Employment precariousness" in a European cross-national perspective. A sociological review of thirty years of research By Jean-Claude Barbier
  2. Back to Basics: Sticky Prices in the Monetary Transmission Mechanism By Nicolás De Roux
  3. Maternal Labor Market Return, Parental Leave Policies, and Gender Inequality in Housework By Pia S. Schober
  4. Kaldor et la théorie keynésienne de la répartition By Alain Béraud
  5. Goodwin's social philosophy: Continuity and change By Massimo Di Matteo
  6. Mozambique Cashew reforms revisited By Aksoy, M. Ataman; Yagci, Fahrettin
  7. The Impact of the Financial Crisis on Insider Trading Profitability in Belgium By D. VAN GEYT; P. VAN CAUWENBERGE; H. VANDER BAUWHEDE
  8. Complexity and Obsolete Data Concepts: Canadian Farm Policy, and the Changing Structure of Agriculture By Freshwater, Dave
  9. The role of universities in searching for a sustainable future through innovation. By Jean-Michel Larrasquet; Véronique Pilnière
  10. Financial Advisors' Role in Influencing Social Security Claiming By Mathew Greenwald; Andrew G. Biggs; Lisa Schneider
  11. Eudaimonía y la economía de la felicidad By Santiago Melo
  12. The firm as a common. The case of accumulation and use of common resources in mutual benefit organizations By Ermanno C. Tortia
  13. Down and Out: Measuring Long-term Hardship in the Labor Market By John Schmitt; Janelle Jones
  14. Why Satisfy Preferences? By Daniel M. Hausman

  1. By: Jean-Claude Barbier (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon 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, a-typical employment, dualization, Europeanization.
    Date: 2011–12
  2. By: Nicolás De Roux
    Abstract: I use the measures of frequency of price adjustment in Nakamura and Steinsson (2008) to show that stickier price industries have higher levels of output response to monetary policy shocks. Using a Vector Auto-regression model, I build different measures of response to a monetary policy shock of 14 US industries. These measures are shown to be related to the level of price rigidity. More precisely, I find that if firms within an industry change prices twice as often as firms in another industry, output deviation from trend in response to a negative shock of 25 basis points will be 69 percentage points smaller in the less sticky industry. This result is stronger when I account for measurement error in the level of response.
    Date: 2011–09–14
  3. By: Pia S. Schober
    Abstract: This study investigates how the duration of the work interruption and the labor market status of mothers upon their return affect the division of housework in couples after a birth. By observing several parental leave policy reforms in Britain and West-Germany, this research also explores how extended leave entitlements for mothers influence the division of housework. The analysis uses multilevel multiprocess models for 1220 birth events of British couples and 1785 births to German couples based on data from the British Household Panel Survey (1991-2008) and the German Socio-Economic Panel (1985-2009). The results suggest that mothers increase their housework hours with every additional month of employment interruption. Mothers' full-time return seems more effective than a short labor market time-out in altering men's housework contributions and reducing the trend towards a more traditional division of housework. Parental leave policy extensions for mothers were associated with the division of housework only indirectly through their impact on the length of women's work interruptions.
    Keywords: Parenthood, parental leave policy, maternal employment, housework, gender division of labor, Britain, Germany
    Date: 2011
  4. By: Alain Béraud (THEMA - Théorie économique, modélisation et applications - CNRS : UMR8184 - Université de Cergy Pontoise)
    Abstract: Kaldor présente l'analyse qu'il fait de la répartition comme une théorie keynésienne. Son travail s'inspire, nous dit-il, des contributions de Keynes, dans le Traité de la Monnaie, et de Kalecki. Cependant, alors que Keynes et Kalecki développent des analyses de courte période, Kaldor décrit les caractéristiques d'un équilibre de longue période si bien que le mécanisme d'ajustement sur lequel il s'appuie, la flexibilité des taux de marge, est inapproprié. Pasinetti, en suggérant que l'article de Kaldor repose sur une erreur logique et que la correction de cette erreur permet de montrer que le taux de profit — en équilibre de longue période — ne dépend que du taux de croissance naturel de l'économie et de la propension à épargner des capitalistes, relança le débat. Cependant, sa thèse paraît discutable. D'une part, l'équilibre qu'il décrit n'est pas unique et il se peut que, dans certaines circonstances, l'économie tende vers un autre équilibre dont les caractéristiques sont déterminées par la propension à épargner des salariés. D'autre part, l'idée que la fonction d'épargne proposée par Kaldor est logiquement incohérente est sans fondement. Enfin, l'hypothèse cruciale sur laquelle repose le raisonnement de Pasinetti, l'existence d'une classe d'individus qui tirent des profits la totalité de leurs revenus ne paraît guère caractériser de façon pertinente les systèmes économiques qui prédominent dans les économies développées.
    Keywords: Kaldor, Keynes, Kalecki, Pasinetti, repartition des revenus
    Date: 2012–01–06
  5. By: Massimo Di Matteo
    Abstract: In the paper I present and discuss an unpublished essay of Richard Goodwin found in the Goodwin’s Archive at the University of Siena on the theme of social philosophy. I will illustrate the main points of his text, briefly compare these late views with those entertained at the beginning of his scientific life (namely his Harvard dissertation on Marxism also kept in the Archive) and add a few remarks in connection with the implications for economics suggested by his analysis.
    Keywords: history of economics, social philosophy.
    JEL: B20 B30
    Date: 2011–10
  6. By: Aksoy, M. Ataman; Yagci, Fahrettin
    Abstract: Cashew policy reforms in Mozambique have been controversial. They are often invoked by critics as an illustration of how agricultural policy reforms supported by international financial institutions may fail to have their intended effects. This paper revisits the reforms and their outcomes almost two decades later. While the reforms resulted in higher producer prices and an increase in output, lack of consensus on the specifics of the reforms and associated non-price support arrangements created a situation in which the sector was not able to withstand international price shocks that ultimately led to a collapse of both the processing industry and cashew production. Non-price support by donors improved the efficiency of the processing industry but this was not complemented by an expansion in cashew nut supply as such support did not extend to smallholder cashew producers. For the reforms to have had their intended results, greater investment in -- and support to -- smallholder production was needed to increase yields and overall output. Such a more comprehensive approach to cashew policy reform would have required a greater focus on achieving consensus on the causes of the cashew sector's problems and agreement by all stakeholders on a common institutional framework for pricing and non-price support.
    Keywords: Markets and Market Access,Emerging Markets,Economic Theory&Research,Access to Markets,E-Business
    Date: 2012–01–01
    Abstract: The 2007 global financial crisis led to a chaotic financial environment characterized by highly uncertain and volatile stock markets. This created additional uncertainty about the fundamental value of shares and potentially increased the benefit of inside information. In this paper, we use event study methodology to examine whether Belgian corporate insiders were able to benefit from these turbulent market conditions. Given the large weight of financial institutions, the Belgian stock market was especially vulnerable to the financial crisis and provides an interesting environment to test this hypothesis. Our results show that, while insiders are generally able to earn abnormal returns, these returns are significantly higher during the years of the financial crisis.
    Keywords: Insider trading, equity markets, market efficiency, information asymmetry, financial crisis, event study, abnormal returns.
    JEL: G01 G14 G18
    Date: 2011–09
  8. By: Freshwater, Dave
    Abstract: Agricultural policy has been unusual in that it has specified the ongoing existence of a desired production unit â the family farm, as a policy objective. But, despite decades of policy intervention, the majority of anadian farms no longer meet the common definition of a family farm. Yet, for the most part, the data collected on farming seems trapped in the use of the older and simpler concept of the family farm. Certainly agriculture is more complex than in the past when the family farm was a useful shorthand expression for the organization of agriculture. Farms now commonly engage in complex marketing arrangements that involve negotiated prices and quality standards. Some farms are completely integrated into processing firms. A large share of farmland is owned by parties who are not considered to be farmers, but in some cases they influence production and marketing decisions. And, most farm households and farm operators now derive a significant portion, if not the majority, of their income from non-­âfarm labor activity. But complexity has another dimension beyond the behavior of farmers and farms. It also describes farm policy. Society now expects more from farm policy than a stable supply of commodities and support for farm income. Reconciling a more nuanced set of policy goals with a heterogeneous structure of agriculture has become a major challenge for providers and analysts of data.
    Keywords: data concepts, farm policy, agricultural policy, Canada, data collection, Agricultural and Food Policy, Community/Rural/Urban Development, Public Economics, Research Methods/ Statistical Methods,
    Date: 2012–01–09
  9. By: Jean-Michel Larrasquet (ESTIA Recherche - Ecole Supérieure des Technologies Industrielles Avancées (ESTIA), CREG - Centre de recherche et d'études en gestion - Université de Pau et des Pays de l'Adour); Véronique Pilnière (ESTIA Recherche - Ecole Supérieure des Technologies Industrielles Avancées (ESTIA), CREG - Centre de recherche et d'études en gestion - Université de Pau et des Pays de l'Adour)
    Abstract: The world's economic and political interactions and exchanges are in a considerable mess today. All private and public sector institutions (including universities) are moving in the same direction by adapting, adopting, accepting the logic of market forces and growth as their own values and goals. It is the blind adherence to these values and practices by leaders and managers that has contributed to the chaos in our western societies. Locked into this mode of thinking, they believe that the only way to make progress is to do more and faster, but in doing so, they not only feed the dynamics of a destructive economic and political machine but also take their institutions to the ultimate terminal state. In the process, we have begun to lose our social and generous values; senses (reason); responsibility for our behaviour; social conscience; the sense of solidarity. And paradoxically we are also losing creativity, initiative, genuine innovation and generating conformity. All societies are moving towards entropy. That is fundamentally why tensions have begun to rise and to become definitely unsustainable. In this context what should the role of universities be? Should they all have the same purpose? Should universities reflect the same destructive values as those in society or should they be the leaders highlighting the dangers and offering alternatives? What role should universities play in the reduction of inequalities? What is innovation at social or collective levels? How could we measure the contribution of innovation to the improvement or destruction of the society? In this context, what is sustainable innovation? All these questions challenge the direction taken not only by western societies but also by human civilization as a whole. There is an urgent need for social debate. In this debate, universities should help participants to understand the implications of the choices being made for the future development of human societies. Then, let that debate inform universities, so as to allow them to make their strategic choices, regarding scientific activities, education, research, transfer and innovation, in a better informed manner.
    Keywords: Research, innovation, social responsibility
    Date: 2012–05–31
  10. By: Mathew Greenwald; Andrew G. Biggs; Lisa Schneider
    Abstract: For millions of Americans, financial advisors are a trusted source of financial and retirement preparation information. This includes providing advice and information on Social Security benefits, a critical component of most Americans’ retirement finances. To gain greater insight into what financial advisors say to their clients about Social Security, an online survey of over 400 professional financial advisors was conducted in the Spring of 2011. The results reveal that a majority of advisors believe that they are responsible for educating their clients on the role Social Security will play in their retirement income. Moreover, advisors have the ability to influence their clients’ decisions about when to claim their Social Security retirement benefits. Three-quarters advise the majority of their clients on when to claim. In addition, the study finds that the Social Security Administration (SSA) is the leading and preferred source of information and education for financial advisors and their clients. Over half of advisors say it is a major source of Social Security-related information, more than any other source. However, advisors are critical of the job SSA does in educating advisors and the public, and are interested in additional resources from the Agency. Financial advisors also indicate that the financial services companies they work with could improve their communication and education efforts as it relates to Social Security. The research findings uncover a need for improved methods of educating and disseminating information to financial advisors and the public on Social Security.
    Date: 2011–11
  11. By: Santiago Melo
    Abstract: En este documento se discuten las principales aproximaciones a la felicidad en la economía de la felicidad: el hedonismo y los enfoques de satisfacción con la vida. Es posible identificar una tensión entre dos principios importantes en esta literatura: 1) los individuos son los mejores jueces de su propia felicidad, y 2) el propósito de la economía debe ser la promoción directa de la felicidad. El artículo sostiene que el hedonismo choca con el primer principio. En el caso de las teorías de satisfacción con la vida, el enfoque restringido choca con ambos principios, mientras que el no restringido sólo con el segundo. El artículo también sostiene que esta rama tiene dificultades para presentar la felicidad como un concepto normativo consistente. Para mostrar esto se estudian las teorías de Aristóteles y Séneca porque: 1) tanto los economistas de la felicidad como los antiguos consideran que la felicidad es el fin último de la vida humana; 2) aunque estos economistas reconocen la importancia de las teorías eudaimonistas de la felicidad, su interpretación y uso no han sido satisfactorios; y 3) el debate entre Aristóteles y Séneca tiene implicaciones importantes sobre el carácter cuantitativo de la felicidad y la capacidad de las políticas públicas para promoverla. La lección principal de los antiguos es metodológica: la riqueza de sus discusiones radica en que las distintas escuelas eran conscientes de que la felicidad es principalmente un concepto ético, cuyo contenido ha de ajustarse a sus exigencias normativas. Éste es un punto que la literatura contemporánea parece haber pasado por alto.
    Date: 2011–08–03
  12. By: Ermanno C. Tortia
    Abstract: Common resources are quasi-public resources, which are rivaled but non excludable in consumption or in appropriation. While the exploitation of common resources has been widely studied in the literature originated by Elinor Ostron’s works (starting from 1990), the study of common resources inside entrepreneurial organization in not sufficiently developed to date. This paper establishes three dimensions that highlight the relevance of the communality of resources in entrepreneurial organizations: the accumulation and use of common capital resources owned by the organization; the distribution of a rivaled, but non excludable value added among the controlling patrons; and the management of common non-owned resources (for example natural resources) by the organization. The first theme is selected and developed further. Cooperative firms are introduced are instance of ownership form that appears, historically and institutionally, to be particularly keen to accumulate, use, distribute common resources.
    Keywords: common resources; rivalry; non-excludability; entrepreneurial organizations; accumulation; cooperative firms
    Date: 2011
  13. By: John Schmitt; Janelle Jones
    Abstract: The official concept of “long-term unemployment,” while useful, is incomplete and, in some cases, even potentially misleading. As tracked by government statistics, the long-term unemployed are only a relatively small part of the population facing extended, sometimes permanent, spells without work. This report proposes rethinking our understanding of long-term unemployment in two ways. First, we encourage shifting from a narrow focus on long-term unemployment toward a broader concept of “long-term hardship” in the labor market. Many workers or potential workers who do not fit the official definition of long-term unemployment – including “discouraged” and “marginally attached” workers and those involuntarily working part-time jobs – face long-term hardship in the labor market, but are not captured in the standard measure of long-term unemployment. Second, we suggest complementing the standard measure of long-term unemployment, which reports the share of the unemployed who have been out of work for 6 months or more, with an alternative measure, which reports the share of the total labor force that has been unemployed for 6 months or more. This alternative measure avoids some counter-intuitive properties of the standard statistic and is better for making comparisons across demographic groups.
    Keywords: unemployment, long-term unemployment, discouraged workers, marginally attached workers, part time for economic reasons
    JEL: J J0 J01 J6 J64
    Date: 2012–01
  14. By: Daniel M. Hausman
    Abstract: Contemporary mainstream normative economists assess policies in terms of their capacities to satisfy preferences, though most would concede that other factors such as freedom, rights, and justice are also relevant. Why should policy be responsive to preferences? This essay argues that the best reason is that people's preferences are in some circumstances good evidence of what will benefit them. When those circumstances do not obtain and preferences are not good evidence of welfare, there is little reason to satisfy preferences.
    Date: 2012–01–05

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