nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2014‒08‒02
sixteen papers chosen by
Carlo D’Ippoliti
Università degli Studi di Roma “La Sapienza”

  1. Why firms avoid cutting wages : survey evidence from European firms By Du Caju, Philip; Kosma, Theodora; Lawless, Martina; Messina, Julian; Room, Tairi
  2. Women Leaders and Social Performance: Evidence from Financial Cooperatives in Senegal By Anaïs Périlleux; Ariane Szafarz
  3. Innovation in real estate and evolutionary agendas By Kauko, Tom
  4. A Model for Integrating Institutional Analysis with Mainstream Economics in Quality-Led Property Development By Nase, Ilir
  5. Gender Representation in the Real Estate Industry By Pauli, Karin Staffansso
  6. Социалнопсихологически аспекти на пазарната размяна в институционалната икономика By Sedlarski, Teodor
  7. Climate Change and Sustainable Welfare: An Argument for the Centrality of Human Needs By Ian Gough
  8. Da MEGA à MEGA2: breve história da edição crítica das obras de Karl Marx By Hugo E. A. da Gama Cerqueira
  9. A Colonial Legacy of African Gender Inequality? Evidence from Christian Kampala, 1895-2011 By Felix Meier zu Selhausen; Jacob Weisdorf
  10. Grammar of difference? Labour policies and social norms on work and gender in the Netherlands and the Netherlands Indies, ca. 1800-1940 By Elise van Nederveen Meerkerk
  11. The issue of value and price in land market research By Woestenburg, Alexander
  12. The return of"patrimonial capitalism": review of Thomas Piketty's capital in the 21st century By Milanovic, Branko
  13. Demand, credit and macroeconomic dynamics: A microsimulation model By Meijers H.H.M.; Nomaler Z.O.; Verspagen B.
  14. Do leaders affect ethical conduct? By Giovanna d’Adda; Donja Darai; Roberto A. Weber
  15. Why Act 'Green'? By Koppels, Philip W.; van der Erve, Fleur
  16. Labor Law Violations in Chile By Kanbur, Ravi; Ronconi, Lucas; Wedenoja, Leigh

  1. By: Du Caju, Philip; Kosma, Theodora; Lawless, Martina; Messina, Julian; Room, Tairi
    Abstract: Firms very rarely cut nominal wages, even in the face of considerable negative economic shocks. This paper uses a unique survey of fourteen European countries to ask firms directly about the incidence of wage cuts and to assess the relevance of a range of potential reasons for why the firms avoid cutting wages. The paper examines how firm characteristics and collective bargaining institutions affect the relevance of each of the common explanations put forward for the infrequency of wage cuts. Concerns about the retention of productive staff and a lowering of morale and effort were reported as key reasons for downward wage rigidity across all countries and firm types. Restrictions created by collective bargaining were found to be an important consideration for firms in Western European (EU-15) countries but were one of the lowest ranked obstacles in the new EU member states in Central and Eastern Europe.
    Keywords: Labor Markets,Labor Policies,Microfinance,Labor Management and Relations,Income
    Date: 2014–07–01
  2. By: Anaïs Périlleux; Ariane Szafarz
    Abstract: How do women leaders such as board members and top managers influence the social performance of organizations? This paper addresses the issue by exploiting a unique database released by a Senegalese network of 36 financial cooperatives sharing identical governance characteristics and placed under the authority of a central union. We scrutinize the loan-granting decisions, made jointly by the locally elected board and the delegated top manager, whose career is supervised by the central union. Our findings are threefold. First, female-dominated boards favor social orientation in loan-granting. Second, female top managers are not necessarily more socially oriented than their male colleagues. Instead, they tend to align their loan-granting strategy with the preferences of the democratically elected board members. Third, the central union tends to assign male managers to cooperatives with female-dominated boards, probably to curb the social orientation of these boards. Overall, gender is a key factor in considering social performance, but gender interactions appear far more complex than previously thought.
    Keywords: Gender; Leadership; Board; Microfinance; Financial Cooperative; Senegal
    JEL: G20 J54 O16 G34 O55 L31
    Date: 2014–07–08
  3. By: Kauko, Tom
    Abstract: Ideally, the notion of innovation enables paving the avenue of research towards evaluation of sustainability in all research areas dealing with the built environment, also real estate. While innovativeness can be understood as an extension of the current paradigm in urban real estate economics, it can also be understood as an alternative paradigm involving more evolutionary perspectives. What happens in the mother discipline of general economics is a reasonable prediction of what eventually will happen in applied disciplines such as real estate economics. However, given the vast differences between physical and asset-oriented views of real estate, it is realistic to assume inertia among real estate economists trained in neoclassical economics in adapting new concepts such as evolutionary dynamics, in which case some other discipline (economic geography, for instance) must set the cross-disciplinary agenda. This paper reviews various literatures involved in this adaption of the innovation-concept and seeks to make connections across them. It argues for the need for real estate economists to open up horizons for dialogue with other disciplines.
    Date: 2014
  4. By: Nase, Ilir
    Abstract: This paper seeks to bridge the gap between theory and practice in delivering quality places through urban design. It complements the behavioural-based theoretical concepts of neoclassical economics with the institutional analysis in property development from the perspective of adding value through quality design. This approach focuses on the drivers and the relationship between actors in the planning, design and development process. The paper follows a sequential path of incrementally building a framework of institutional analysis to eventually present a model for delivering quality in the built environment. The final product presents a 'meso-range' theoretical framework that links concepts of neoclassical economics to institutional analysis and follows two principles. First, mainstream economics and institutionalism in property development should be complementary rather than exclusive of each other. This is based on the concept that institutional analysis and behavioural theories can be used complementarily to understand and describe the delivery of a value added product through the property development process. Second, since very little of the broad economic perspectives have been applied to the property discipline, there should be a theory with an economic focus that serves to support and link institutional models.
    Date: 2013
  5. By: Pauli, Karin Staffansso
    Abstract: Purpose - This study contributes to our understanding of gender and the real estate industry. The purpose is to examine how annual reports contribute to the gendering of the real estate industry in Sweden. To fulfill the purpose, representations of gender in financial annual reports in the real estate industry are analyzed. Design/methodology/approach - A critical theoretical perspective is applied. The empirical data of the study consists of representations of gender in photographs in financial annual reports. The sample consists of annual reports of real estate companies with different business concepts. The annual reports are seen as social constructs, that is to say they are seen as human products expressing corporate identities. Findings - Having analyzed the reports it becomes clear that the different organizations seem to show different awareness regarding representations of gender in the photographs; thereby different corporate identities are expressed, partly due to different business concepts. There are stereotypical images of women and men that serve to maintain the hierarchical gender order in the industry. The token position -being one of the few women in the real estate industry is also used. Women are underrepresented in the corporate identity and the heterosexuality is also preserved.Originality/value - This kind of study is not previous made in the real estate industry.
    Date: 2013
  6. By: Sedlarski, Teodor
    Abstract: Резюме Представени са някои неортодоксални аспекти на институционалния подход към пазарите като социални структури (институции). Демонстрирана е възможността за обогатяване на новоинституционалния анализ, основаван на концепциите за формални и неформални норми, имуществени права, транзакционни разходи, ограничена рационалност и социални мрежи, чрез отчитане ролята на обществени феномени като властта, статусното съревнование и когнитивните предизвикателства на разширените възможността за избор. Придобитите с помощта на разширения институционален подход изводи са отнесени към проблема на дългосрочната устойчивост на пазарната обществена система. Abstract This article summarizes some unorthodox aspects of the institutional approach to the markets as social structures (institutions). Demonstrated is the possibility to extend the new institutional analysis, based on the concepts of formal and informal rules, property rights, transaction costs, limited rationality and social networks, considering the role of social phenomena such as power, status competition and cognitive challenges of the greater selection opportunities. The conclusions of the proposed extended institutional approach are related to the problem of the long-term sustainability of the market society.
    Keywords: open access societies, natural orders, status, relative income, happiness, impersonal exchange, embeddedness
    JEL: A12 B41 B52 P16
    Date: 2014–01–31
  7. By: Ian Gough
    Abstract: Since climate change threatens human wellbeing across the globe and into the future, we require a concept of wellbeing that encompasses an equivalent ambit. This paper argues that only a concept of human need can do the work required. It compares need theory with three alternative approaches. Preference satisfaction theory is criticised on the grounds of subjectivity, epistemic irrationality, endogenous and adaptive preferences, the limitlessness of wants, the absence of moral evaluation, and the non-specificity of future preferences. The happiness approach is found equally wanting. The main section shows how these deficiencies can be addressed by a coherent theory of need. Human needs are necessary preconditions to avoid serious harm, are universalisable, objective, empirically grounded, non-substitutable and satiable. They are broader than 'material' needs since a need for personal autonomy figures in all theoretical accounts. While needs are universal, need satisfiers are most often contextual and relative to institutions and cultures. The satiability and non-substitutability of needs is critical for understanding sustainability. The capability approaches of Sen and Nussbaum are compared but argued to be less fundamental. Finally, human needs provide the only concept that can ground moral obligations across global space and intergenerational time and thus operationalise 'sustainable welfare'.
    Keywords: Human needs, welfare theory, wellbeing, global justice, intergenerational justice, sustainability, preferences, capabilities
    JEL: B5 I00 P46 Z13
    Date: 2014–07
  8. By: Hugo E. A. da Gama Cerqueira (Cedeplar-UFMG)
    Abstract: This paper discusses the attempts to publish a historical-critical edition of the works of Karl Marx, the Marx-Engels Gesamtausgabe (MEGA): the first one, which was led by David Riazanov in the 1920s and 1930s, and the second one, the MEGA2 project which begun in the 1970s and is still in course of publication. The paper presents these two editions and discusses their impact on the interpretation of Marxs economic and philosophical thought.
    Keywords: Karl Marx (1818-1883); Friedrich Engels (1820-1895); MEGA; marxology.
    JEL: A31 B14 B24
    Date: 2014–07
  9. By: Felix Meier zu Selhausen; Jacob Weisdorf
    Abstract: The colonial legacy of African underdevelopment is widely debated but hard to document. We use occupational statistics from Protestant marriage registers of historical Kampala to investigate the hypothesis that African gender inequality and female disempowerment are rooted in colonial times. We find that the arrival of Europeans in Uganda ignited a century- long transformation of Kampala involving a gender Kuznets curve. Men rapidly acquired literacy and quickly found their way into white-collar (high-status) employment in the wage economy built by the Europeans. Women took somewhat longer to obtain literacy and considerably longer to enter into white-collar and waged work. This led to increased gender inequality during the first half of the colonial period. But gender inequality gradually declined during the latter half of the colonial era, and after Uganda’s independence in 1962 its level was not significantly different from that of pre-colonial times. Our data support Boserup’s view that gender inequality was rooted in native social norms: daughters of African men who worked in the traditional, informal economy were less well educated, less frequently employed in formal work, and more often subjected to marital gender inequality than daughters of men employed in the modernized, formal economy created by the Europeans.
    Keywords: Africa, Church Books, Colonialism, Development, Female Disempowerment, Gender Discrimination, Gender Inequality, Missionaries, Uganda
    Date: 2014–07
  10. By: Elise van Nederveen Meerkerk
    Abstract: This paper investigates developments in labour policies and social norms on gender and work from the perspective of colonial entanglements. At the beginning of the nineteenth century, work was seen a means to morally discipline the poor, both in the Netherlands and the Netherlands Indies. A prime example are the initiatives by Johannes van den Bosch, who first in 1818 established 'peat colonies(!)' in the Netherlands, where the urban poor were transported to become industrious agrarian workers. In 1830, the same Van den Bosch introduced the Cultivation System in the Netherlands Indies, likewise, to increase Javanese peasants' industriousness. During the nineteenth century, ideals and practices of the male breadwinner started to pervade Dutch working-class households, and child and women's labour laws were issued. Instead, legislation in the Netherlands Indies was introduced very late and under heavy pressure of the international community. Not only did Dutch politicians consider it 'natural' that Indonesian women and children worked. What is more, they presented the inherent differences between Indonesian and Dutch women as legitimation for the protection of the latter: a fine example of what Ann Stoler and Frederick Cooper have called a 'grammar of difference'.
    Keywords: Social policy, Women's work, Child labour, Colonial history, Labour relations.
    Date: 2014–07
  11. By: Woestenburg, Alexander
    Abstract: This paper discusses the reciprocal relationship between land value and the negotiated transaction price of land. In a market that is characterized by many inefficiencies we may hold the hypothesis that price does not equal value (Wyman, Seldin & Worzala, 2011). This hypothesis raises the question of how value and price relate to each other. We present a conceptual framework that understands land transaction outcomes through the lenses of their transaction processes. These processes are shaped by judicial boundaries, laws, regulations and actor behavior. We argue that, together, those institutional aspects determine the interplay between land value and price.In order to allow for transactional aspects in land market analyses, this conceptual framework challenges conventional methodologies and data sources and calls for the use of a combination of both quantitative and qualitative research approaches towards land market research.The framework is applied to two Dutch land market segments: the market for rural land and the market for inner city building land. A hedonic price analysis of rural land prices, based on notarial deeds of purchase, shows the institutional richness of notarial deeds as data source for land market research purposes. It shows the greater explanatory power of including transaction characteristics and with that, it sheds a different light on the use of appraised value or transaction price data in hedonic land market analyses (Ma and Swinton, 2012). Next, an in-depth analysis of inner city land transactions reveals that both value and price are determined during the land transaction process. This finding is different from the causal relation we expected; namely that transaction processes cause a land price to deviate from its value.We conclude that the interplay and difference between land value and land price, caused by the institutional transaction context, should be subject to land market analysis, rather than just the focus on price or value.-----Ma, S. and Swinton, S.M. (2012), “Hedonic valuation of farmland using sale prices versus appraised values�, Land Economics, Vol. 88 No. 1, pp. 1-15.Wyman, D., Seldin, M. and Worzala, E. (2011), “A new paradigm for real estate valuation?�, Journal of Property Investment & Finance, Vol. 29, No. (4/5), pp. 341-358.
    Date: 2014
  12. By: Milanovic, Branko
    Abstract: The paper provides a detailed review of Thomas Piketty's book"Capital in the 21st century."It focuses on the new contributions of the book, and in particular on its unified treatment of economic growth, functional income distribution, and concentration of personal income. It concludes that Piketty's reinvigoration of classical and empircally-drven approach is likely to have a profound impact on economics.
    Keywords: Economic Theory&Research,Political Economy,Emerging Markets,Inequality,Poverty Impact Evaluation
    Date: 2014–07–01
  13. By: Meijers H.H.M.; Nomaler Z.O.; Verspagen B. (UNU-MERIT)
    Abstract: We develop a microsimulation model for the macroeconomic business cycle. Our model is based on three main ideas i we want to specify how macroeconomic coordination is achieved without a dominating influence of price mechanisms, ii we want to incorporate the stock-flow-consistent approach that has become popular in post-Keynesian macroeconomics, and iii we want to allow for bankruptcies as a major mechanism in the business cycle. Compared to existing stock-flow-consistent models, our model has relatively few equations. It is operationalized using micro, agent-based simulation. The results show a clear business cycle that is driven by accumulation of financial assets and the effects this has on the real economy. By changing some of the key parameters, we show how the nature of the business cycle changes as a result of changes in the assumed behaviour of agents.
    Keywords: Current Heterodox Approaches: General; Current Heterodox Approaches: Institutional; Evolutionary; Macroeconomics and Monetary Economics: General; Business Fluctuations; Cycles;
    JEL: E00 E32 B50 B52
    Date: 2014
  14. By: Giovanna d’Adda; Donja Darai; Roberto A. Weber
    Abstract: We study whether leaders influence the unethical conduct of followers. To avoid selection issues present in natural environments, we use a laboratory experiment in which we form groups and assign leadership roles at random. We study an environment in which groups compete, with dishonest behavior enhancing group earnings to the detriment of social welfare. We vary, by treatment, two instruments through which leaders can influence follower conduct—prominent statements to the group and the allocation of monetary incentives. In general, the presence of active group leaders gives rise to significantly more dishonest behavior. Moreover, appointing leaders who are likely to have acted dishonestly in a preliminary stage of the experiment yields groups with significantly more unethical conduct. The analysis of leaders’ strategies reveals that leaders’ statements have a stronger effect on follower behavior than the ability to distribute financial rewards, and that leaders’ propensity to act dishonestly correlates with their use of statements or incentives as a means for encouraging dishonest follower conduct.
    Keywords: Leadership, ethics, dishonesty, experiment
    JEL: C92 C72 D03
    Date: 2014–07
  15. By: Koppels, Philip W.; van der Erve, Fleur
    Abstract: Over the last couple of years, there has been a growing interest in the financial performance of green buildings. Past research results indicate that green buildings are able to realise higher rents and sustain higher occupancy rates compared to other (non-green) buildings. It is argued that these findings are explained by the (supposed) additional occupier benefits of green buildings, such as lower operating costs, improved employee productivity and image benefits. However, in many studies it remains unclear which motive primary drives office users to prefer green buildings. Furthermore, the reported results -- the percentage rent increase and occupancy rates -- deviate to a large extent, while comparable methods and data sets are used.The aim of this research is two-folded. First, it strives to formulate a model of corporate real estate ecological responsiveness. What are the main motives of firms to lease or buy green buildings? Second, different hedonic model specifications and estimation techniques are compared to achieve insight in which hedonic model technique provides the most credible results regarding the price effects of green buildings. The relative large deviations, and sometimes implausible signs, in the reported results of the various hedonic price studies, might indicate that in some cases the models suffer from misspecification. Possibly resulting in an over- or underestimation of the rent price and occupancy effects related to green buildings.This research combines various research methods to achieve both research aims. First, a meta-analysis of published green hedonic office price is performed. Whereby special attention is given to the model specification and estimation methods. Second, an hedonic office price study is performed for the Randstad agglomeration -- Amsterdam, Rotterdam, Utrecht and The Hague -- that compares different plausible model specifications. Finally, the hedonic study is followed up by interviewing office tenants to derive their motivation for choosing green buildings.
    Date: 2013
  16. By: Kanbur, Ravi; Ronconi, Lucas; Wedenoja, Leigh
    Keywords: Agricultural and Food Policy, Political Economy,
    Date: 2013

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