nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2015‒04‒11
twenty papers chosen by
Carlo D’Ippoliti
Università degli Studi di Roma “La Sapienza”

  1. Mainstreaming. Reflections on the Origins and Fate of Mainstream Pluralism. By Cedrini, Mario; Fontana, Magda
  2. The Role of Psychology in Austrian Economics and Game Theory: Subjectivity and Coordination By Richard Arena; Lauren Larrouy
  3. Gender Differences in the Distribution of Total Work-Time of Latin-American Families: The Importance of Social Norms By Campaña, Juan Carlos; Gimenez-Nadal, J. Ignacio; Molina, José Alberto
  4. The Doctrine of Public Education of Condorcet in Light of the Discussion on Women'S Rights and Slavery at the Beginning of the Third Republic By Anastasia V. Yastrebtseva
  5. The footprint of evolutionary processes of learning and selection upon the statistical properties of industrial dynamics By Giovanni Dosi; Marcelo C. Pereira; Maria Enrica Virgillito
  6. The Making of an Economic Superpower―Unlocking China’s Secret of Rapid Industrialization By Wen, Yi
  7. Strategic Responses to Deregulation: An Institutional Theory Perspective By Sharma, Sunil
  8. Evolution of Gender Inequalities in Wages in Senegal Following the Economic Partnership Agreements (EPA) By Franck Viroleau
  9. Economic Concepts in Biology – Issues with Hamilton´s rule By Friedrich, Thomas
  10. Real Rigidities and the Cross-Sectional Distribution of Price Stickiness: Evidence from Micro and Macro Data Combined By Carlos Viana de Carvalho; Niels Arne Dam; Jae Won Lee
  11. Soggettività intermittenti. Un’inchiesta sulla scomposizione del lavoro nell’ambito del loisir By Chicchi, Federico; Savioli, Marco; Turrini, Mauro
  12. On the Economic Relevance of the Principle of Gratuitousness By Sergio Beraldo
  13. Wealth Distribution, Elasticity of Substitution, and Piketty: an anti-dual Pasinetti Economy. By Luca Zamparelli
  14. An economic appraisal of MOOC platforms: business models and impacts on higher education By BELLEFLAMME, Paul; JACQMIN, Julien
  15. Man-cessions, Fiscal Policy, and the Gender Composition of Employment By Bredemeier, Christian; Juessen, Falko; Winkler, Roland
  16. An Application of Partial Least Squares to the Construction of the Social Institutions and Gender Index (SIGI) and the Corruption Perception Index (CPI) By Jisu Yoon; Stephan Klasen
  17. On the Samuelson-Etula Master Function and Marginal Productivity: some old and new critical remarks By Dvoskin, Ariel; Fratini, Saverio M.
  18. Unions and Collective Bargaining in the Wake of the Great Recession By Addison, John T.; Portugal, Pedro; Vilares, Hugo
  19. Longévité différentielle et redistribution: enjeux théoriques et empiriques By LEROUX, Marie-Louise; PESTIEAU, Pierre; PONTHIERE, Grégory
  20. Involving men in reproductive and fertility issues: insights from Punjab By Iram Kamran; Mumraiz Khan; Zeba Tasneem

  1. By: Cedrini, Mario; Fontana, Magda (University of Turin)
    Abstract: There is considerable discussion on the so-called “mainstream pluralism”, which stems from the growth and coexistence of new research programs in economics that significantly deviate from the neoclassical core. Other disciplines have actively contributed to the birth of such programs, that are carried on by different, often separated communities of researchers. Although “mainstream pluralism” is not the pluralism heterodox economists and students groups have sought for in the recent decades, its persistence over time might provide a possible precondition for the advent of pluralism in economics. While the literature tends to regard mainstream pluralism as a transitory state towards a new, post-neoclassical, mainstream, this paper contributes to the debate by bringing in a different perspective, focusing on economics’ fragmentation and the necessity of specialization. We adopt a “late Kuhnian” framework (derived from Kuhn’s late works on specialization), considering not scientific revolutions but specialization as key engine of progress in science, and interpret mainstream pluralism as the result of economics’ recent growth in size and dive rsity. To account for the necessity of specialization in economics, we employ Ronald Heiner’s work on the competence-difficulty gap, as well as the evidence offered in some recent studies about the impact of the “burden” of previously accumulated knowledge on innovative behaviour. After a bird’s eye view on the recent history of economics in relation to other disciplines (and an analysis of Herbert Gintis’s “unity of behavioral sciences” proposal as possible new mains tream), we discuss the possibility that today’s “mainstream pluralism” might persist over time.
    Date: 2015–02
  2. By: Richard Arena (University of Nice Sophia Antipolis, France; GREDEG CNRS); Lauren Larrouy (University of Nice Sophia Antipolis, France; GREDEG CNRS)
    Abstract: In this contribution we relate the respective works of two important economists, Friedrich von Hayek and Michael Bacharach, namely one of the main intellectual leaders of the Austrian Schools and one of the most original game theorists. Hayek and Bacharach are two authors - few in number – who do not conceive that economic analysis could be built without the help of psychology. They both considered that subjective perceptions of the real world provide the first stage of decision processes and that, within this stage, psychological factors played a fundamental role. Therefore, they both proposed how perceptions, economic rationality and social coordination could be combined. However economists who really accept to take psychology into account often face new difficulties. The incorporation of subjectivity in economic behaviour can make much more complex the analysis of economic and social coordination. To overtake these new difficulties we will see that both Hayek and Bacharach integrate a specific approach to human cognition and resort to an evolutionary explanation of social coordination. This is the main message we deliver in this contribution.
    Keywords: Austrian economic theory, game theory, cognitive psychology, subjectivism, social coordination
    JEL: B21 B40 B53 C72 D01 D11 D50
    Date: 2015–03
  3. By: Campaña, Juan Carlos (University of Zaragoza); Gimenez-Nadal, J. Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza)
    Abstract: We analyze differences by gender in the time dedicated to total work (paid and unpaid) by families in Latin America, with particular attention to the effect of social norms. To this end, we use survey data on time use in Mexico (2009), Peru (2010), Ecuador (2012) and Colombia (2012), to estimate differential equations through OLS. Our results reveal differences between countries in terms of the gender distribution of total work (paid work plus unpaid work), with Colombia and Peru being more equitable. These two countries could be approaching a situation of "iso-work", or equality of work, in the sense that men and women spend similar amounts of time in total work. When considering the social norms that explain gender differences in the time spent in total work, we use data from the last wave (2010-2014) of the World Values Survey (WVS). Our results indicate that the more egalitarian countries exhibit the highest levels of equality in the distribution of work. It is important to know how men and women from these four countries distribute their time in total work, in order to understand why there are clear differences by gender.
    Keywords: total work, Latin America, differences by gender, social norms
    JEL: D13 J22 J13 J16
    Date: 2015–03
  4. By: Anastasia V. Yastrebtseva (National Research University Higher School of Economics)
    Abstract: This paper offers an analysis of the public education project proposed by Nicolas de Condorcet (1743-1794) which appeared to be too modern for the late XVIII century but extremely vital for the last three decades of XIX century. His ideas were taken and made foundation for the reforms proposed by Jules Ferry and Ferdinand Buisson, whose names are traditionally linked with the formation of the “republican school” in France.
    Keywords: enlightenment, public education, republicanism, school, equality, social progress
    JEL: Z
    Date: 2015
  5. By: Giovanni Dosi; Marcelo C. Pereira; Maria Enrica Virgillito
    Abstract: Evolutionary theories of economic change identify the processes of idiosyncratic learningby individual firms and of market selection as the two main drivers of the dynamics of industries. Are such processes able to robustly account for the statistical regularities which industrial structures and dynamics display? In this work we address this question by means of a simple agent-based model formalizing the mechanisms of learning and selection. The interplay between these two engines shapes the dynamics of entry-exit and market shares and, collectively, the productivity and the size distributions and their patterns of growth. As such, and despite its simplicity, the model is able to robustly reproduce an ensemble of empirical stylised facts, including ample heterogeneity in productivity distributions, persistent market turbulence and fat-tailed distribution of growth rates.
    Keywords: Firms' Growth Rate, Productivity, Fat Tail Distributions, Learning Processes, Market Selection
    Date: 2015–01–04
  6. By: Wen, Yi (Federal Reserve Bank of St. Louis)
    Abstract: The rise of China is no doubt the most important event in world economic history since the Industrial Revolution. The institutional theory of development based on a dichotomy of extractive vs. inclusive political institutions cannot explain China’s rise. This article argues that only a radical reinterpretation of the history of the Industrial Revolution and the rise of the West (as incorrectly portrayed by the institutional theory) can fully explain China’s growth miracle and why the determined rise of China is unstoppable. Conversely, China’s spectacular and rapid transformation from an impoverished agrarian society to a formidable industrial superpower sheds considerable light on the fundamental flaws of neoliberalism and the Washington Consensus and provides more-accurate reevaluations of historical episodes such as Latin America’s lost decade and plagued debt crisis, 19th century Europe’s great escape from the Malthusian trap, and the Industrial Revolution itself.
    Keywords: Industrial Revolution; the Rise of China; the Great Divergence; Market Fundamentalism; Neoliberalism; Big Push; Import Substitution Industrialization; Shock Therapy; Washington Consensus; New Structuralism; New Stage Theory.
    JEL: B00 N00 O1 O2 O3 O4 O5
    Date: 2015–03–01
  7. By: Sharma, Sunil
    Abstract: Firms adopt distinct strategic orientation in response to change in environment. Deregulation is a drastic change in firm’s environment. This paper attempts to explain strategic orientation exhibited by firms in response to deregulation from an institutional theory perspective. Integrating propositions have been developed to examine congruence of institutional theory concepts of coercive and mimetic isomorphism with stylized strategic orientation. Unique methodology of corroborating propositions with empirical findings from past studies was adopted. While partial support was found for propositions, the inferences drawn provide alternative explanations for results of empirical studies and for expanding the boundaries and scope of institutional theory.
  8. By: Franck Viroleau
    Abstract: There are considerable gender inequalities in the labor market in Senegal. As Senegal will try a trade opening with the European Union in the framework of the EPA, we can raise the question of whether the new equilibrium of the economy will produce either a decrease or an increase in the gender inequalities in the labor market. We use the latest data given by the National Statistic and Demographic Agency of Senegal to study, in a prospective approach, the evolution of remuneration by gender, which follows the EPA’s trade opening of the economy. The ex-ante analysis is built on the basis of a computable general equilibrium model that deals with gender distinction. Our key finding is that, under the more likely hypothesis of the way in which the loss of tariff revenues for the Senegalese government will be offset, the opening will increase the well-being of the population in a comprehensive way, but it will meanwhile increase the wage gap between men and women. More precisely, the opening acts as a catalyst for the differential of existing gender wage inequalities for the reference year of our study in the qualified and unqualified labor markets. The decline of the share in the wage bill for women in the unqualified labor market weighted for the relative share of these markets after the trade opening is also a prevailing explanation. The adoption of the EPA’s opening can thus be seen as a more or less severe trade-off between overall well-being and the increase in the gender wage gap and be considered as a choice of society.
    Keywords: CGEM, EPA, Gender inequalities, Trade opening, Senegal, Ex-ante evaluation, Public policy.
    JEL: C68 D58 D61 D63 D78 F13
    Date: 2015
  9. By: Friedrich, Thomas
    Abstract: Hamilton´s rule is considered a cornerstone in evolutionary biology. It is used to understand why organisms help relatives and serves as starting point for the development of cooperation between strangers. The rule is based on a method from economics. It compares a benefit to cost ratio (k) to a genetic relation (r). Two issues are discussed. A solution is suggested.
    Keywords: Hamilton´s rule, benefit, cost, alogism
    JEL: Z00
    Date: 2015–04–02
  10. By: Carlos Viana de Carvalho (Department of Economics PUC-Rio); Niels Arne Dam (Danmarks Nationalbank); Jae Won Lee (Seoul National University)
    Date: 2014–12
  11. By: Chicchi, Federico; Savioli, Marco; Turrini, Mauro
    Abstract: The workers of the “creative industries” are paradigmatic subjects of the process of “work fragmentation” in the post-Fordist era. Cutting across any division between life and work, employment and unemployment, performing arts are, in many ways, a laboratory of job flexibility, where innovative contractual arrangements and professional trajectories have been advanced. Empirical data from a combined method based on both a quantitative survey and in-depth interviews with artists, technicians, and organizers working in the fields of theatre, music, dance, and video-making are used to map the multiplicity of these forms of labour, whose hybrid status is epitomized by the paradoxical condition of what we have defined as the “salaried employer”. The aim is to provide a multi-layered analysis of the mutual interactions between socio-economic conditions, career development, and cultural aspects, i.e. expectations, reputation, self-perception and social recognition of these jobs. Accordingly, these patterns of work are studied as self-employment strategies based on diversification of activities and expertise, and at the same time, as attempts to devise new spatial and temporal configurations of labour. From this perspective, precariousness emerges as a generative terrain of ambivalent subjectivities. On the one hand, the workforce is mobilized spontaneously and organized autonomously by the mobilization of desire, expression, and self-fulfilment, beyond mere economic rewards. On the other hand, labour becomes increasingly intertwined with life and becomes immeasurable, since time loses its function of measurement unit for compensation (i.e. works are rewarded by fixed rates). This situation frequently leads to a spread of labour into other spheres of life and to the risk of self-exploitation. To conclude, an analysis of quantitative data shows how job and employers diversification is proportionally related to job satisfaction. Precariousness has to be considered, beyond the myth of permanent employment, as a condition of contemporary work.
    Keywords: post-Fordism, precariousness, performing art workers, subjectivities
    JEL: Z13
    Date: 2013–12
  12. By: Sergio Beraldo (Università di Napoli Federico II and CSEF)
    Abstract: In this paper the principle of gratuitousness and its relationships with other principles which motivate behaviour, such as those inspired by reciprocity, is analyzed. The basic premise is that gratuitousness is a feature acquired by an action by virtue of the intentions that inspire the action itself. In this respect, the search for gratuitousness may require to discriminate among aestetically equivalent actions on the basis of the psychological disposition of the actor. The main claim of the paper is that in economically relevant situations gratuituousness is to be conceived as a modality of cooperation, emerging as the outcome of a team reasoning perspective and motivating such a perspective without any need for reciprocity. This claim is analyzed with regard to blood donations and, more generally, with regard to the voluntary provision of goods.
    Keywords: Gratuituousness, reciprocity, team reasoning
    JEL: D03 D63 D64
    Date: 2015–04–07
  13. By: Luca Zamparelli (Sapienza, University of Rome)
    Abstract: This paper examines the evolution of wealth distribution between workers and capitalists. It shows that under competitive conditions, and when factors elasticity of substitution is high enough to ensure endogenous growth, capitalists' share of total wealth asymptotically tends to one if they have a higher propensity to save than workers. It is also shown that a tax on capital income shifts wealth distribution in workers' favor and makes any level of wealth concentration feasible.
    Keywords: Wealth distribution, elasticity of substitution, Pasinetti two-class equilibrium, Piketty
    JEL: E12 E13 E25
    Date: 2015–01
  14. By: BELLEFLAMME, Paul (Université catholique de Louvain, CORE, Belgium); JACQMIN, Julien (LAMETA, University of Montpellier, France)
    Abstract: We start by using various economic and pedagogical concepts to understand the specificities of MOOC (Massive Online Open Courses) platforms. We then discuss how the private provision of MOOCs, seen as pure public goods, can be sustained. Based on the theory of multisided platforms, we analyse five ways to monetize the MOOC business. Our conclusion is that the most sustainable approach is what we call the ‘subcontractor model’, flavored by touches of the other four models. We then claim that MOOC platforms can play a key transformative role in the higher education sector by making teaching practices evolve, rather than by replacing incumbent institutions. Finally, we derive a number of directions for public policy: governments should act to foster the cooperation between MOOC platforms and other higher education institutions, so as to improve the benefits that can arise from these technological innovations; a particular focus should also be given to professors in order to encourage them to innovate in their teaching practices
    Keywords: higher education, distance learning, multisided platforms
    JEL: I23 I21 L31 L86
    Date: 2014–11–05
  15. By: Bredemeier, Christian (University of Cologne); Juessen, Falko (University of Wuppertal); Winkler, Roland (TU Dortmund)
    Abstract: In recessions, predominantly men lose their jobs, which has given rise to the term "man-cessions". We analyze whether fiscal expansions bring men back into jobs. To do so, we estimate vector-autoregressive models and identify the effects of fiscal shocks and non-fiscal shocks on the gender composition of employment. We show that contractionary non-fiscal shocks lead to man-cessions, i.e. employment falls and more strongly so for men. By contrast, an expansionary fiscal shock predominantly raises the employment of women. Taken together, these results imply a trade-off dilemma for policy that seeks to stabilize the level of employment along with its composition.
    Keywords: employment, gender, fiscal policy, business cycles
    JEL: E24 E32 J10 J21
    Date: 2015–03
  16. By: Jisu Yoon (Georg-August-University Göttingen); Stephan Klasen (Georg-August-University Göttingen)
    Abstract: In this paper the Social Institutions and Gender Index (SIGI) is constructed with Principal Component Analysis (PCA) and Partial Least Squares (PLS). Using the SIGI, we test the effects of social institutions related to gender inequality on several development outcomes, such as female education, fertility, child mortality and corruption, controlling for relevant determinants. As the measure of corruption we use the Corruption Perception Index (CPI), considering alternative weighting procedures using PCA and PLS. We find that gender inequality in social institutions has significant effect on fertility and corruption regardless of the weighting procedure, while for female education and child mortality only the SIGI based on PLS generates significant results.
    Keywords: Social Institutions and Gender Index; SIGI; Corruption Perception Index; CPI; Principal Component Analysis; PCA; Partial Least Squares; PLS; non-metric variables
    JEL: C43 J16 B54 D73
    Date: 2015–03–27
  17. By: Dvoskin, Ariel; Fratini, Saverio M.
    Abstract: The paper addresses the ambiguity that surrounds the conception of capital and its role in neoclassical price-and-distribution theory. The difficulties encountered in the various attempts to define the marginal product either of capital or of a capital good are recalled and the conclusion is drawn that neither concept appears theoretically sound. This is combined with critical discussion of the recent attempt by Samuelson and Etula to determine income distribution by means of their ‘Master Function’ and its ‘non-neoclassical’ marginal products. Rather than the existence of a continuum of alternative technical possibilities, Samuelson and Etula assume the simultaneous coexistence of a discrete number of methods of production for the same commodity. Even though each technique employs the inputs in fixed proportions, the coexistence of various techniques permits the full employment of an arbitrarily given vector of input endowments. As is shown here, however, the coexistence of methods required for the differentiability of the Samuelson-Etula Master Function can take place, if capital goods are used in production, neither in the case with stationary relative prices nor in the non-stationary Arrow-Debreu framework.
    Keywords: capital – capital goods – marginal product of capital – Master Function - neoclassical theory of value and distribution –Samuelson
    JEL: B21 C61 D24 D46 D51
    Date: 2015–04
  18. By: Addison, John T. (University of South Carolina); Portugal, Pedro (Banco de Portugal); Vilares, Hugo (Banco de Portugal)
    Abstract: This paper provides the first definitive estimates of union density in Portugal, 2010-2012, using a unique dataset. The determinants of union density at firm level are first modeled. Next, we draw upon a very recent study of the union wage premium to provide summary estimates of the union wage gap for different ranges of union density. Since these estimates fully reflect the reality of an industrial relations system in which collective agreements are extended to nonunion workers and firms, the final issue examined is contract coverage. Although there has occurred a pronounced fall in the number of new extension agreements in recent years, this decline has been uncritically linked with a fall in coverage. We show that the number of workers covered by new and existing agreements has been largely unaffected by economic crisis. The reduced frequency of new agreements and extensions is viewed as an aspect of downward nominal wage rigidity in deflationary times (the counterpart of "upward nominal wage rigidity" in more normal times) rather than the immediate expression of a crisis in collective bargaining per se.
    Keywords: collective bargaining, union density, collective agreement coverage, union wage premium, nominal wage rigidity, Portugal
    JEL: J31 J52 J53
    Date: 2015–03
  19. By: LEROUX, Marie-Louise (Département des Sciences Economiques, ESG-UQAM, Montréal, Canada; CIRPEE; CESifo and Université catholique de Louvain, CORE, Belgium); PESTIEAU, Pierre (University of Liège, CREPP, Belgium; Université catholique de Louvain, CORE, Belgium; Toulouse School of Economics, France and CEPR); PONTHIERE, Grégory (University Paris East, Créteil and Paris School of Economics, France)
    Abstract: Dans cet article, nous étudions l’impact des différences de longévité sur la conception des politiques publiques, en particulier celles liées au départ à la retraite. Nous montrons premièrement qu’alors même que l’espérance de vie a augmenté de manière très importante tout au long du siècle dernier, il subsiste encore de fortes disparités. Deuxièmement, nous étudions d’un point de vue normatif comment les différences de longévité sont généralement prises en compte dans les modèles de cycle de vie et montrons que certaines hypothèses peuvent avoir des implications fortes en terme de redistribution intra-générationnelle. Nous identifions au moins trois arguments en faveur d’une redistribution vers les agents à faible longévité: l’aversion à l’inégalité intertemporelle, l’aversion au risque de mortalité et la compensation pour des caractéristiques dont les agents ne sont pas responsables. Nous étendons ensuite notre analyse de manière à tenir compte du fait que les individus puissent être en partie responsables de leur longévité. Finalement, nous lions ces résultats aux débats actuels sur la réforme des systèmes de retraite. Nous montrons qu’en général, parce que les pensions de retraite sont conditionnelles à la survie des bénéficiaires, les systèmes de retraite publics vont redistribuer des ressources des agents dont la durée de vie est courte vers ceux dont la durée de vie est longue. Nous fournissons des pistes de réformes qui viseraient à mieux prendre en compte ces différences de longévité et en particulier, celles relatives à la création d’une “rente longévité” telle que souhaitée par le Comité d’Amours et au développement de l’assurance autonomie, qu’elle soit privée ou publique.
    Keywords: systèmes de retraite, mortalité différentielle
    JEL: H31 H53 I31
    Date: 2014–11–05
  20. By: Iram Kamran; Mumraiz Khan; Zeba Tasneem
    Abstract: This study explored Pakistani (especially Punjabi) couples' dynamics during their decision processes on fertility intentions and practices, along with community perceptions of male-focused interventions as well as men's suggestions for future intervention strategies. It drew on three sources a 2013 qualitative study in four districts of Punjab province; a targeted analysis of the baseline and endline surveys of the Family Advancement for Life and Health (FALAH 2007-2012) project; and the Pakistan Demographic Health Survey (PDHS) of 1990 - 1991 and of 2006-2007. The four districts of the 2013 qualitative study were Bahawalpur, Jhelum, D.G.3 Khan, and Okara. (The first three were FALAH districts in which interventions were tested, the fourth the control district.) Twelve focus group discussions (FGDs) were conducted with men only, and in-depth interviews (IDIs) were conducted with 26 couples in these four districts in 2013. Participants were identified by key informants. Data from 2, 649 men and 638 couples from the FALAH baseline and endline surveys in 14 selected districts of the FALAH project were reanalyzed to assess the impact of FALAH male-directed interventions on fertility intentions and behavior.
    Keywords: absolute terms, access to reproductive health services, adolescent, adolescent fertility, adult literacy, antenatal care, basic education, basic health, child mortality ... See More + contraception, contraceptive prevalence, deaths, Early marriage, economic growth, Family Health, fertility, fertility rate, first birth, first marriage, Gender inequality, Health Management, human development, income, live births, malnutrition, maternal health, maternal health outcomes, maternal health services, maternal mortality, Ministry of Health, National Family Health Survey, Nutrition, Population Research, Population Studies, pregnancy, pregnancy rates, progress, Public Health, reducing maternal mortality, Regional Context, Regional Office, Remittances, replacement level, REPRODUCTIVE HEALTH, rural access, Skilled birth attendance, UNFPA, working-age population, World Health Organization
    Date: 2014–11

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