nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2015‒01‒19
eighteen papers chosen by
Carlo D’Ippoliti
Università degli Studi di Roma “La Sapienza”

  1. Divided Opinion on The Fair Minimum Wage Act of 2013: Random or Systematic Differences? By Donal O'Neill;
  2. Downward Nominal Wage Rigidity: Unions’ Merit Or Firms’ Foresight? By Alexander V. Larin
  3. University Merger And Sensemaking At The Threshold: Understanding Radical Organizational Change In Higher Education By Ivan Pavlyutkin
  4. Les conséquences environnementales des inégalités économiques : structuration théorique et perspectives de recherche (In French) By Alexandre BERTHE; Luc ELIE
  5. Jalons pour une économie politique de la trajectoire malgache : une perspective de long terme By Mireille Razafindrakoto; François Roubaud; Jean-Michel Wachsberger
  6. The Circular Relationship between Inequality, Leverage, and Financial Crises: Intertwined Mechanisms and Competing Evidence By Rémi Bazillier; Jérôme Héricourt
  7. Schumpeter and Venture Finance. Radical Theorist, Broke Investor and Enigmatic Teacher By Michael Peneder; Andreas Resch
  8. Exclusive Solidarity? Radical Right Parties and the Welfare State By Elie Michel
  9. Equidad de género, mercado de trabajo y sindicalismo en la Argentina By Aspiazu, Eliana
  10. Integrating qualitative methods into investment climate impact evaluations By Mendoza Alcantara, Alejandra; Woolcock, Michael
  11. The Rational Islamic Actor? Evidence from Islamic Banking By Seda Demiralp; Selva Demiralp
  12. Socio-technical dynamics and political institutions: A multilevel Darwinian framework of sustainability transitions By G. Marletto
  13. Women and happiness By Matteucci, Nicola; Vieira Lima, Sabrina
  14. Rentier Developmentalism, Servicization and DInRT Economies By constantine, collin
  15. Land.Value.Money By Ternyik, Stephen I.
  16. Puzzles of public opinion: Why Soviet population supports the transition to capitalism since the 1980S By Popov, Vladimir
  17. Новая теория рынка и капитализма. В 3-х частях. Часть 3. Капитализм By Zheleznyak, Anatoliy
  18. Новая теория рынка и капитализма. В 3-х частях. Часть 1. Рынок By Zheleznyak, Anatoliy

  1. By: Donal O'Neill (Economics, National University of Ireland, Maynooth);
    Abstract: This paper analyses economists’ support for the Fair Minimum Wage Act of 2013, by examining the characteristics of almost 1000 economists who signed open letters either supporting or opposing the Bill prior to a Senate debate on the legislation. In contrast to previous work, which found that economists’ disagreements were surprisingly random, I find systematic differences between those economists supporting the legislation and those opposing it. There is evidence of a saltwater-freshwater divide in attitudes, with support for the Bill stronger for economists located further from Chicago. In addition support for the legislation is higher among females and those who obtained their PhD outside the US. Financial economists are more likely to oppose the Bill, while those specialising in labour economics are more likely to support it. Furthermore the support among labour economists is strongest for academics who have received their PhD in recent years. This may reflect the impact of recent work in labour economics challenging the traditional competitive model of labour markets.
    Date: 2014
  2. By: Alexander V. Larin (National Research University Higher School of Economics)
    Abstract: This paper investigates the sources of the downward nominal wage rigidity in Russia. The empirical analysis is based on the RLMS-HSE household survey from 2004 to 2013. We show that, in spite of weak labor unions in Russia, the extent of downward nominal wage rigidity is high. Moreover, the probability of a wage freeze is decreasing in firm size and is lower for industries with industry-level tarif agreements. Our ndings present empirical evidence that the main source of the downward nominal wage rigidity is not the labor unions, but firms' voluntary decision to prevent wage cuts, which may cause quits of valuable employees and/or a decrease in their efforts
    Keywords: Downward nominal wage rigidity, RLMS-HSE
    JEL: J31 J51
    Date: 2014
  3. By: Ivan Pavlyutkin (National Research University Higher School of Economics.)
    Abstract: This paper discusses radical change in higher education reflecting on its deconstructive nature. While the notions of adaptive and strategic change assume strengthening the existing settings of university organization, radical change means the deconstruction of the established organizational order. Radical change creates uncertainty and demands an understanding of social relations in the implicit or informal side of the organisation. This research is based on an empirical case of university merger as an example of radical and risky change in higher education. It applies the sensemaking approach to disclosing the cultural side of organizing. We argue that radical change in higher education originates a specific of sensemaking at the threshold where the symbolic order becomes the source of meanings for actors to deal with ambiguity. Analysing 22 in-depth interviews taken with top-level administrators and academic employees at three merged universities we show that radical change occurs through practices of labelling, rumouring and translation. They produce a virtual structure on the implicit side of organizing and influence the interpretation of change as a rite of passage or a rite of organisational degradation.
    Keywords: university merger, sensemaking, radical organizational change, identity, translation
    JEL: I21
    Date: 2014
  4. By: Alexandre BERTHE; Luc ELIE
    Abstract: Le renforcement actuel des inégalités économiques, souvent considéré comme intrinsèquement néfaste, est de plus en plus reconnu comme générateur d’effets secondaires, par exemple sur la santé ou la croissance. Face à la persistance de la crise environnementale contemporaine, le rôle de ces inégalités dans la dégradation de l’environnement se pose également de manière exacerbée. Malgré un nombre important de contributions, ce phénomène ne fait l’objet d’aucun consensus tant sur le plan théorique qu’empirique. Le premier apport de cet article est de proposer un cadre d’analyse permettant de révéler la diversité des mécanismes envisagés théoriquement et de les positionner les uns par rapport aux autres. Il apparaît que les conclusions des auteurs sur ce sujet dépendent des hypothèses qu’ils posent concernant 1) la relation entre revenu individuel et pression environnementale individuelle, 2) l’impact des inégalités sur les normes sociales influençant les comportements individuels de consommation, 3) l’intérêt des groupes sociaux à la dégradation ou la protection de l’environnement, 4) la façon dont ces intérêts se révèlent en demande politique et 5) la façon dont les demandes politiques se confrontent pour se traduire en une décision politique. Le second apport de notre travail est d’identifier les contributions et les limites des analyses empiriques traitant du sujet. Bien que permettant de tester la nature générale de la relation causale entre inégalité et environnement, la méthode utilisée ne permet pas une prise en compte de la diversité des mécanismes théoriques. Dans cette perspective, nous proposons un programme de recherche reposant sur l’investigation empirique des cinq hypothèses précédemment mentionnées par une approche récursive.
    Keywords: Inégalités économiques, pressions environnementales, politiques environnementales
    JEL: O13 O15 Q53 Q56
    Date: 2014
  5. By: Mireille Razafindrakoto (IRD, UMR DIAL, PSL, Université Paris-Dauphine); François Roubaud (IRD, UMR DIAL, PSL, Université Paris-Dauphine); Jean-Michel Wachsberger (Université Lille 3, UMR DIAL)
    Abstract: (english) This article aims at supplying an interpretative frame of the long-term Malagasy trajectory by redrawing the structuring knots of its political economy. The concomitance of periods of economic expansion and political crises leash indeed to suppose that one of the essential sources of the difficulties met by the country is its weak capacity to establish a stable political consensus around the processes of accumulation and the way of wealth distribution. In this hypothesis, the understanding of the Malagasy trajectory passes by a proofreading of the long history to highlight, for every period, the elements of system regulation and the contradictions which it faces. From precolonial period to our days, we identify the main actors, the sources of power and wealth, the modes of economic and social regulation and the contradictions of the system. This modelled proofreading of the history leads us to distinguish six big periods marking each a clear break with the one that came before without managing to solve all the main contradictions. _________________________________ (français) Cet article vise à fournir un cadre interprétatif de la trajectoire malgache de long terme en retraçant les noeuds structurants de son économie politique1. La concomitance de périodes d’expansion économique et de crises politiques laisse en effet supposer qu’une des sources essentielles des difficultés rencontrées par le pays est sa faible capacité à instaurer un consensus politique stable autour des processus d’accumulation et des modes de répartition des richesses. Dans cette hypothèse, la compréhension de la trajectoire malgache passe par une relecture de l’histoire longue en vue de mettre en évidence, pour chaque période, les éléments de régulation du système et les contradictions auxquelles il fait face. De la période précoloniale à nos jours, nous identifions les principaux acteurs, les sources de pouvoir et de richesse, les modes de régulation économique et sociale et les contradictions du système. Cette relecture modélisée de l’histoire nous conduit à distinguer six grandes périodes marquant chacune une nette rupture avec celle qui précède sans réussir pour autant à en résoudre les principales contradictions.
    Keywords: political economy, Madagascar, Long-term history, elites, rents, coalitions, institutions, growth, économie politique, histoire longue, élites, rentes, croissance.
    JEL: P48 F50 D70
    Date: 2014–11
  6. By: Rémi Bazillier; Jérôme Héricourt
    Abstract: The academic interest around the well-known inequality-finance nexus has recently been the subject of a renewed attention. A recent, yet flourishing literature started pointing inequality as a possible cause credit bubbles, leading to financial crises. Based on the existing literature, this paper aims at disentangling the various influences underlying the two-way relationship between inequality and finance, by focusing on a causality chain made of three main links: inequality, credit, and financial crises. The literature finds evidence of a positive causal relationship from inequality to credit, both direct (a rise of credit demand as a result of high inequalities) and indirect (inequality incites governments to support credit supply in order to maintain aggregate consumption); coincident factors are not to be excluded either (financial deregulation increasing simultaneously both inequalities and leverage). As credit booms appear to be the main determinant of financial crises, the possible direct and indirect impact of inequalities on such booms is a fundamental dimension to be taken into account by policymakers. Finally, the literature does not provide decisive conclusions concerning the sign of the distributional impact of financial development, financial deregulation and financial crises. It is fair to say however, that a majority of studies conclude to an increase of inequality following a financial crisis. The gaps identified in the literature allow pointing at several avenues for future research.
    Keywords: Finance;Inequality;financial crises;household debt
    JEL: D31 D33 E25 E50 G18
    Date: 2014–12
  7. By: Michael Peneder (WIFO); Andreas Resch
    Abstract: Schumpeter's relation to venture finance constitutes a fascinating yet so far unacknowledged chapter of his biography and financial history. Presenting new historical evidence and pointing out connections that have so far escaped attention, we first discuss Schumpeter's venture theory of money and banking, then his personal history as a broke investor in Vienna, and finally his influence on the emerging venture industry during his later years at Harvard. We show how the theoretical vision inspired his failed effort as a venture investor in the 1920s, and provided a powerful intellectual frame for the later development of venture finance in the 1940s.
    Date: 2014–12–16
  8. By: Elie Michel
    Abstract: Radical right parties in Western Europe have traditionally shown little support for redistributive policies and have thus been typically classified as economically right wing. Yet, they are contesting the votes of a (formerly) key electorate of the social democratic parties: the working class, who supports welfare redistribution. In this study, we argue and empirically demonstrate that radical right parties have adapted their programmatic preferences to this key segment of electorate by progressively promoting redistributive policies. For our analyses we use mixed methods and rely on a combination of data sources. Firstly, we assess the salience of welfare issues in the manifestos of major West European radical right parties over the last three decades based on CMP data. Secondly, we examine their positions on welfare issues based on recent euandi data. Thirdly, we analyse the most recent manifestos of two successful radical right parties (Austrian FPÖ and French FN) qualitatively. Our findings show that for a majority of radical right parties welfare state expansion has become a salient issue, and that they do not position themselves anymore on the right regarding redistributive issues; however, these parties promote a specific kind of solidarity: exclusive solidarity.
    Keywords: political parties
    Date: 2014–12–16
  9. By: Aspiazu, Eliana
    Abstract: En las últimas décadas, se evidenciaron en nuestro país importantes avances en la inclusión de la perspectiva de género en la legislación, las políticas públicas y la normativa de regulación de las relaciones laborales. A su vez, se crearon organismos especializados en temas de género y aumentó la participación femenina en los sindicatos a partir del incremento en la inserción laboral de las mujeres y de la sanción de la ley de cupo femenino. A pesar de ello, aún se está lejos de una inclusión significativa de la perspectiva de género en la política sindical y en los ámbitos de negociación colectiva. Este artículo presenta un breve recorrido teórico y empírico que vincula las dimensiones de género, trabajo y sindicalismo. Desde una mirada teórica, se analiza la inclusión de la dimensión de género en el campo de estudios del mundo del trabajo y de las relaciones laborales. Con una visión empírica se indaga en los avances y obstáculos de la participación de las mujeres en el mercado laboral y en el ámbito gremial, así como sobre algunos mecanismos de promoción de la igualdad, como las leyes de cupo y la negociación colectiva.
    Keywords: Género; Mercado de Trabajo; Sindicalismo; Negociación Colectiva;
    Date: 2014
  10. By: Mendoza Alcantara, Alejandra; Woolcock, Michael
    Abstract: Incorporating qualitative methods into the evaluation of development programs has become increasingly popular in recent years, both for the distinctive insights such approaches can bring in their own right and because of their capacity to complement the strengths -- and where necessary correct some of the weaknesses -- of quantitative approaches. Some initial work deploying mixed methods has been undertaken in the assessment of investment climate reforms, but considerable room for expansion exists. This paper summarizes some of the key principles and practices underpinning mixed methods evaluations in development, highlight some notable examples of how such work has been conducted (and the particular contributions it has made), and offers some guidelines for those seeking to increase the sophistication and utility of qualitative methods in the evaluation of investment climate reforms.
    Keywords: Science Education,Scientific Research&Science Parks,Poverty Monitoring&Analysis,Poverty and Social Impact Analysis,Knowledge for Development
    Date: 2014–12–01
  11. By: Seda Demiralp (Department of Political Science, Isik University); Selva Demiralp (Department of Economics, Koc University)
    Abstract: Islamic banks create an interest in their own right as a rising branch in financial intermediation, particularly in the post-crisis era. In addition, they also deserve the attention of the students of Islamism due to their possible connection with Islamic movements. Through a comparison of Islamic and conventional banking, we analyze the motivations and behavior of Islamic economic actors who determine the cash flow to Islamic banks. Our findings suggest that, in contrast to popular views that portray these actors as ideologues or financiers of radical Islam, they have pragmatic motivations and may adapt to liberal systems to seize economic incentives.
    Date: 2014–12
  12. By: G. Marletto
    Abstract: The study of sustainability transitions (SUSTRANs) is an emerging research field that provides useful keys to understand how more sustainable ways to meet societal needs may emerge and develop. As stressed by some scholars, much more work is needed to make political institutions endogenous to SUSTRANs. This paper contributes to such a research endeavour by providing a simple conceptual framework based on multiple levels of Darwinian evolution. The evolutionary environment is defined by a societal function (e.g., urban mobility), which is fulfilled by socio-technical systems (STSs) (e.g., the car, public transport, the bicycle, etc.). Three levels of evolution are considered - a lower level, with firms; two higher levels, with innovation networks and socio-political communities, respectively. While competing within the same STS, firms cooperate within a socio-political community in order to back their STS, and compete with other – both existing and emerging – STSs that fulfil the same societal function. With this simple framework SUSTRANs can be represented as a multilevel evolutionary process that endogenously generate the needed favourable policies (FPs). A socio-political community supporting a new and more sustainable STS achieves the ability to induce FPs only if it is able to scale up – and reach a tipping point – in the cumulative causation process between the enlistment of new members and an increasing level of legitimation. The proposed framework can be applied not only to SUSTRANs, but to all socio-technical transitions, where power and competition can be considered as multilevel phenomena, and multi-industry dynamics are at centre stage.
    Keywords: Sustainability transition, Political institutions, Evolutionary, Group selection
    JEL: B52 Q56
    Date: 2014
  13. By: Matteucci, Nicola; Vieira Lima, Sabrina
    Abstract: We survey the Happiness and Economics field to systematize the explanations of the happiness gender gap, whose puzzling evidence stands out both synchronically and diachronically. Further, this analysis is completed by an interdisciplinary review of competing perspectives, mostly from psychology and medical sciences. Beside disciplinary specificities and differences, results and explanations also reveal some intriguing commonalities. Psychology and medical sciences (also assisted by cutting edge medical technologies) lead in the static (time-invariant) explanation of happiness and its gender gap, while economic works are better equipped to detect external factors and the role of time-varying objective life conditions. In particular, the Happiness and Economics field has provided original evidence on the country and time variant nature of the happiness gender gap. Finally, different disciplines uncovered the common stylized fact that women are increasingly worse off during their life, by aging, with respect to men: its full explanation still remains at the center of the research agenda.
    Keywords: Happiness, Subjective Well-Being, Psycological Well-Being, Gender gap, Determinants, Interdisciplinary review
    JEL: A12 D10 I31 J13 J16
    Date: 2014–09
  14. By: constantine, collin
    Abstract: This article draws a parallel between rentier capitalism and what the author calls rentier developmentalism. This refers to the growing influence of rent seeking or DInRT sectors: Distribution, ICTn (that are non-tradable), Restaurant and Transportation & storage. Similar to rentier capitalism and financialization, the growth of DInRT economies is part of a serivicizaton process that result in economic fragility and increasing inequality. Therefore, further classification of countries into FIRE and DInRT economies are needed to ascertain the quality and inclusive nature of growth in the poor and developing world. The article highlights the importance of re-incorporating the concept of Ricardian rents and differentiating these from profits in economic analysis.
    Keywords: financialization, inequality, rentier developmentalism, rent seeking
    JEL: D30 O11 O54
    Date: 2014
  15. By: Ternyik, Stephen I.
    Abstract: A free earth reform algorithm is introduced, based on the concept of geo-liberty and the physics of social systems.The design of a sustainable economic science is prepared in step-by-step procedures, discussing the working factors of economic complexity and by reducing the single systemic elements of dependency.
    Keywords: land, value, money, free earth, algorithm, geo-liberty, physicality, energetics, sustainability
    JEL: B0
    Date: 2014
  16. By: Popov, Vladimir
    Abstract: Why even after the dramatic increase in inequality in the 1990s and after the emergence and enrichment of “oligarchs”, the alternative (leftist, social democratic) economic policies that could have improved material and social wellbeing of the majority of the population is not supported by this majority? It is argued that in immature democracies (without efficient restrictions for the participation of private capital in politics) mass media and electoral campaigns are controlled by the rich, so there is vicious circle: market reforms and private property create the class of the wealthy “oligarchs” that are not only interested in these reforms, but also have power to maintain their political and economic might through mass media and democratic elections. The return of public opinion to the “norm” so that it reflects interests of the majority is possible only if mass media and political process are separated from private capital and private financing.
    Keywords: Public opinion, transition from socialism to capitalism, inequalities, elections, mass media
    JEL: H00 P26 P3
    Date: 2014–12–24
  17. By: Zheleznyak, Anatoliy
    Abstract: A new heterodox theory of capitalism is suggested. Its key moments and general logic are presented. Capitalism is considered as a special case of market, as its higher form. Disequilibrium and "imperfect competition" are admitted to be a functional norm of capitalism. Respectively, an equilibrium and "perfect competition" are admitted to be a functional anomaly; crises are considered as the result of such an anomaly. General principles and concrete measures of crisis-proof policy and crisis-proof behavior are suggested. Comparison with alternative theories is made.
    Keywords: Theory of capitalism; capitalism; profit; equilibrium (balance); disequilibrium (imbalance); perfect competition; imperfect competition; monopoly; crisis; crisis-proof policy; crisis-proof behaviour
    JEL: A10 B50 D00 D50 E00 E32 P10
    Date: 2014–12
  18. By: Zheleznyak, Anatoliy
    Abstract: A new heterodox theory of market is suggested. Its key moments are presented. The theory is based on the distinction between two market types – the simple commodity market and the capitalist one. Definitions of market and of each of its types are given. Internal logic of transition from the former to the latter is considered. Comparison with alternative theories is made.
    Keywords: Market; simple commodity market; capitalist market
    JEL: A10 B50 D00 D50 E00 P00
    Date: 2014–12

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