nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2019‒01‒14
fifteen papers chosen by
Carlo D’Ippoliti
Università degli Studi di Roma “La Sapienza”

  1. Capital accumulation and corporate portfolio choice between liquidity holdings and financialisation By Giovanni Scarano
  2. The welfare state and liberal democracy: A political economy approach By Heise, Arne; Serfraz Khan, Ayesha
  3. Developing a Model for Corporate Governance and Conflict of Interest Deterrence in Shari’ahbased Cooperatives By Shafii, Zurina; Obaidullah, Mohamed; Samad, Rose Ruziana; Yunanda, Rochania Ayu
  4. Alternative visions: Permaculture as imaginaries of the Anthropocene By Roux-Rosier Anahid; Ricardo Azambuja; Gazi Islam
  5. Capital, Non-Capital and Transformative Politics in Contemporary India By Deepankar Basu
  6. Pro-environmental norms and subjective well-being: panel evidence from the UK By Martin Binder; Ann-Kathrin Blankenberg; Heinz Welsch
  7. Recession, Austerity and Gender: A Comparison of Eight European Labour Markets By Hélène Périvier
  8. Capitalism's Deniers By Nitzan, Jonathan; Bichler, Shimshon
  9. Subject Pools and Deception in Agricultural and Resource Economic Experiments By Timothy N. Cason; Steven Y. Wu
  10. Social inclusion in an alternative food network: values, practices and tensions By Catherine Closson; Estelle Fourat; Laurence Holzemer; Marek Hudon
  11. Stress Testing Frameworks and Practices in Dual Banking System: A Preliminary Assessment By Zulkhibri, Muhamed; Ismail, Abdul Ghafar
  12. Islamic Financial Institutions and Participatory Finance Constraints: The Case of Pakistan By Ali, Azam; Kishwar, Tanveer; Zulkhibri, Muhamed
  13. “ I Shot the Sheriff ”: Irony, Sarcasm and the Changing Nature of Workplace Resistance By Rafael Alcadipani; John Hassard; Gazi Islam
  14. Universal basic income proposals in light of ILO standards key issues and global costing By Ortiz, Isabel,; Behrendt, Christina.; Acuña-Ulate, Andrés.; Nguyen, Quynh Anh.
  15. Green employment: What, where and how much? By Francesco Vona; Giovanni Marin; Davide Consoli

  1. By: Giovanni Scarano
    Abstract: Most models of investment decisions utilised in macroeconomic models take free or perfect competition as explicit or implicit assumption. However, the oligopolistic structure of most real markets lead to corporate strategic behaviours that can produce very different results. Strategic decisions, connected with agency problems, can play a major role in producing financialisation and timing the rhythms of real investment. The paper deals with both mainstream and heterodox contributions that analyse the effects of corporate governance and strategic behaviours on portfolio management and investment decisions in big corporations, seeking to determine how these effects might play a major role in producing growing liquidity holdings and financialisation. The main objective is to understand whether these models can explain the tendency to place growing shares of social surplus in speculative financial channels, thereby contributing to long-term real stagnation.
    Keywords: Investment theory, Interest Rate, Corporate Savings, Financialisation,Financial Crises
    JEL: B51 E11 E12 E32 G35
    Date: 2019–01
  2. By: Heise, Arne; Serfraz Khan, Ayesha
    Abstract: This paper attempts to shed some light on the developments of welfare states in highly developed nations since WW2 within the context of a narrative which seeks to combine institutional distinctions, termed 'varieties of capitalism', with the historical regimes of regulation theory in a political economy perspective which puts interested political actors at centre stage. It will be argued that in a liberal democracy, the elite has the framing and agenda-setting power to 'manufacture a political will' according to its interests. The welfare state is not the result of a long social struggle on the part of the needy; rather, it results in its general features from the minimal state of meritocratic exigencies. Under the very peculiar circumstances of the post-WW2 era, this even translated into a rise in social welfare spending to more than a third of national income. The particular design of welfare state organisation was the subject-matter of political conflict, and a clear distinction between liberal and coordinated market economies can be attributed to cultural differences and institutional settings. Yet the core of the welfare state conception serves the interest of the meritocracy as much as those who benefit from social programmes and re-distribution. And the neoliberal attack on the welfare state since the 1980s is not a necessary re-calibration due to changing economic conditions or a growing lack of solidarity among the people but an expression of a modified cost-benefit analysis from the elite's perspective.
    Keywords: Welfare State,Keynesian National Welfare State,Schumpeterian Competition State,Elite,Agenda Theory
    JEL: B59 I31 P16 P31
    Date: 2018
  3. By: Shafii, Zurina (Universiti Sains Islam Malaysia); Obaidullah, Mohamed (The Islamic Research and Teaching Institute (IRTI)); Samad, Rose Ruziana (Universiti Sains Islam Malaysia); Yunanda, Rochania Ayu (Universiti Sains Islam Malaysia)
    Abstract: Different from a conventional cooperative, a Shari’ah-based cooperative observes Shari’ah principles. As these cooperatives offers Islamic financial products and involves in Shari’ah compliant investment, they are bound to observe Shari’ah governance structure, transparency, disclosure of information and strict compliance with Shari’ah principles. Compliance with the Shari’ah principles will strengthen public confidence in the credibility of the system of the Islamic Muamalat particularly in the cooperative movement. Due to the infancy of Shari’ahbased cooperative industry that needs for proper governance measures, this paper aims to discuss corporate governance in Shari’ah-based cooperatives in the attempt to propose a model for resolving stakeholders’ conflicts of interest
    Keywords: Microfinance; Cooperatives; Shari’ah; Corporate Governance
    Date: 2017–07–11
  4. By: Roux-Rosier Anahid (IRPhiL - Institut de recherches philosophiques de Lyon - UJML - Université Jean Moulin - Lyon III); Ricardo Azambuja (MC - Management et Comportement - Grenoble École de Management (GEM)); Gazi Islam (MC - Management et Comportement - Grenoble École de Management (GEM), IREGE - Institut de Recherche en Gestion et en Economie - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc)
    Abstract: The current paper uses the concept of imaginaries to understand how permaculture provides alternative ways of organizing in response to the Anthropocene. We argue that imaginaries provide ways of organizing that combine ideas and concrete practices, imagining organizational alternatives by enacting new forms of collective practice. Permaculture movements, because of their combination of local, situated design practices and underlying social and political philosophies, provide an interesting case of imaginaries that make it possible to reimagine the relations between humans, non-human species and the natural environment. We identify and describe three imaginaries found in permaculture movements, conceiving of permaculture respectively as a technical design practice, a holistic life philosophy, and an intersectional social movement. These imaginaries open up possibilities for political and social alternatives to industrially organized agriculture, but are also at risk of various forms of ideological co-optation based on their underlying social premises. We discuss our perspective in terms of developing the concept of imaginaries in relation to organizational scholarship, particularly in contexts where fundamental relations between humans and the natural environment must be reimagined, as in the case of environmentalist organizing in response to the Anthropocene.
    Keywords: Anthropocene,Permaculture,Imaginaries,Social Imaginaries,Organizing,Collective,Environmental Imaginaries
    Date: 2018
  5. By: Deepankar Basu (Department of Economics, University of Massachusetts - Amherst)
    Abstract: Kalyal Sanayal’s work on postcolonial capitalism has been influential in many strands of critical social theory. In this brief note, I investigate three key components of his argument and find them wanting. In particular, I show that the evolution of land ownership in India does not support the claim that the primitive accumulation of capital is one of the important processes in operation in contemporary India. On the contrary, the evidence suggests that the process of primitive accumulation has been arrested or significantly slowed down. In addition to the critical comments on Sanyal (2007), I indicate towards an alternative framework that is better able to explain the key features of contemporary India.
    Keywords: postcolonial capitalism
    JEL: B24 O29
    Date: 2019
  6. By: Martin Binder (Bard College Berlin); Ann-Kathrin Blankenberg; Heinz Welsch (University of Oldenburg, Department of Economics)
    Abstract: Tying in with a small number of studies on green norms, identity and subjective well-being, this paper studies the relationship between holding a green self-image and life satisfaction in the UK. Focusing on (sub-national) regions as the unit of reference, we investigate if and how the individual-level greenness-satisfaction relationship varies with measures of the prevalence and distribution (disparity) of greenness at the regional level, taking these measures as indicators of a green social norm. Two key findings emerge from our analysis. First, life satisfaction is negatively related to the regional-level mean (prevalence) and positively related to the regional-level diversity of greenness, while being unrelated to the degree of polarization of greenness. Taking the prevalence as a direct and diversity as an inverse measure of the validity of a greenness norm, these results are consistent with the idea that the norm is experienced (by greens) as a standard of reference in the process of green status competition or (by non-greens) as a source of social pressure. Second, the well-being benefits from holding a greener self-image are unrelated to the prevalence and diversity of greenness, but positively related to the polarization of greenness for those either very green or not green at all. This is consistent with the idea that green self-image yields well-being benefits through identity, that is, by identifying with the own group and differentiating oneself from other groups – a possibility that relies on sufficiently large differentiation/polarization of groups. We discuss differences between these results and previous findings based on measures of nation-wide prevalence and disparity of greenness.
    Keywords: subjective well-being, norms, green behavior, green self-image, fractionalization, polarization
    Date: 2019–01
  7. By: Hélène Périvier (Observatoire français des conjonctures économiques)
    Abstract: The collapse in GDP brought about by the global economic crisis in 2008 affected female employment less than male employment, whereas austerity has been particularly harsh on women, a gendered impact described in the literature as “he‐cession to sh(e)‐austerity”. This article analyses gendered trends in the labour markets of eight European countries, decomposing quarterly changes in labour participation of women and men and in employment by sector. The “he‐cession to sh(e)‐austerity” scenario is not observed in all countries. Other channels through which austerity policies can jeopardize gender equality and women's rights are identified with reference to a typology of such policies.
    Keywords: Recession and gender; Austerity and gender; Female employment; Economy and gender
    Date: 2018
  8. By: Nitzan, Jonathan; Bichler, Shimshon
    Abstract: A new, capitalism-denying book is on the shelves, and it makes a stunning discovery: ‘Capitalism without competition is not capitalism’! Capitalist crisis, like climate change, tends to breed ‘capitalism deniers’. The problem, argue the deniers, lies not in capitalism but in its ‘distortions’. In its pure form, they maintain, capitalism is the best of all possible worlds. But to the deniers’ chagrin, contemporary capitalism is no longer pristine. Unlike its original, once-upon-a-time version, its current one is subject to distorting ‘imperfections’, ‘shocks’ and ‘exogenous’ events. And it is these aberrations – rather than capitalism itself – that should be blamed for the system’s misfortunes.
    Keywords: capitalism,competition,fundamentalism,ideology,neoclassical economics
    JEL: L L1 P
    Date: 2019
  9. By: Timothy N. Cason; Steven Y. Wu
    Abstract: The use of student subjects and deception in experiments are two controversial issues that often raise concerns among editors and reviewers, which might prevent quality research from being published in agricultural and resource economics (ARE) journals. We provide a self-contained methodological discussion of these issues. We argue that field professionals are the most appropriate subjects for questions related to policy or measurement, and students are the most appropriate subjects for scientific research questions closely tied to economic theory. Active deception, where subjects are provided with explicitly misleading information, has been avoided in the mainstream economics discipline because it can lead to a loss of experimental control, lead to subject selection bias, and impose negative externalities on other researchers. Disciplinary ARE journals may want to abide by these norms against deception to maintain credibility. Interdisciplinary ARE journals may have more flexibility, although it is important to provide guidelines to avoid too much reviewer-specific variation in standards. For ARE researchers, we suggest employing a deception-free experimental design whenever possible because we know of no field in which deception is encouraged.
    JEL: C9 Q10 Q30 Q50
    Date: 2018–12
  10. By: Catherine Closson; Estelle Fourat; Laurence Holzemer; Marek Hudon
    Abstract: This paper explores challenges a consumer food cooperative must address to combine social inclusion and embeddedness in its urban environment with the food quality standards it targets. While the difficulty in making alternative food networks (AFNs) socially accessible is well documented, little is known about organizational practices that foster inclusion in AFNs. Our research—based on over 100 participant observations of meetings held at the cooperative and on food activities with members of community organizations—has generated insight on how a participative process—through collective decisions, knowledge exchanges and workslot commitments—could facilitate or restrain social inclusion. Our results suggest that promotion of the value of equality for the largest number is hindered by differences in food, material and consumer cultures between cooperative members and non-members. The value of equality for the largest number is pragmatically applied through social inclusion regarding food supply and voluntary work participation.
    Keywords: Alternative food network; Participatory action research; Consumer food cooperative; Social inclusion; Accessibility; Food democracy
    JEL: Q18 Q01 M10
    Date: 2019–01–07
  11. By: Zulkhibri, Muhamed (The Islamic Research and Teaching Institute (IRTI)); Ismail, Abdul Ghafar (The Islamic Research and Teaching Institute (IRTI))
    Abstract: This paper critically reviews and evaluates stress-testing frameworks and practices of supervisory authorities in a dual banking system namely Malaysia, Indonesia and Pakistan. The analysis suggests that similar to single banking system, there are two main designs to stress testing -bottom-up and top-down - depending on the institutional responsibilities and computational capabilities, while relying on two main techniques of stress tests, sensitivity tests and scenario tests (historical or hypothetical). None of these countries differentiates the stress testing design and approach between conventional and Islamic banking industry. The application of stress testing in these countries follows similar approach to conventional banking system. The analysis also suggests that stress-testing approach for Islamic banking system should be developed capturing the unique balance sheets structure and risks of Islamic banking so that it provides accurate assessments of vulnerability in the Islamic banking system.
    Keywords: Islamic bank; stress-tests; systemic risks; financial stability
    Date: 2017–05–17
  12. By: Ali, Azam (State Bank of Pakistan); Kishwar, Tanveer (Jinnah University for Women, Karachi, Pakistan); Zulkhibri, Muhamed (The Islamic Research and Teaching Institute (IRTI))
    Abstract: Islamic financial contracts are designed to facilitate financing according to Islamic norms. Islamic financing in its first stages used only the partnership modes of Musharakah and Mudarabah. Later it is realized that, to avoid moral hazards, yet compete successfully with conventional banks, it is necessary to use all permissible Islamic modes and consequently, trade and leasing techniques were developed. This paper aims to identify the constraints faced by Islamic financial institutions in the adoption of participatory finance i.e., Musharakah and Mudarabah financing. The two basic categories of financing are: 1) profit-and-loss-sharing (PLS), also called participatory finance, i.e. Musharakah and Mudarabah and 2) purchase and hire of goods or assets and services on a fixed-return basis, i.e., Murabahah, Istisna', Salam and Ijarah also called non-participatory finance. This paper suggests that innovation and creativity is necessitated more than ever to promote participatory modes of financing and to make it the preferred choice for meeting the increasingly sophisticated and diversified financial needs.
    Keywords: Participatory Finance; Impact Analysis; Islamic Banks; Pakistan
    JEL: A13 B41 E50
    Date: 2018–05–08
  13. By: Rafael Alcadipani (FGV-EAESP - Fundação Getúlio Vargas - Escola de Administração de Empresas de São Paulo - FGV - Fundacao Getulio Vargas [Rio de Janeiro]); John Hassard (Manchester School of Management); Gazi Islam (MC - Management et Comportement - Grenoble École de Management (GEM), IREGE - Institut de Recherche en Gestion et en Economie - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc)
    Abstract: The spread of Lean management has fuelled debates over the changing nature of workplace domination. While Lean discourses often espouse a 'human relations' approach, research has suggested the proliferation of coercion systems and questioned whether Lean is instead shorthand for cost-cutting and new forms of domination. The varied interpretations of Lean have explained the heterogeneity of worker responses, including forms of resistance. Our ethnography explores this heterogeneity by examining the implementation of Lean in a printing factory and tracing the emergence of shopfloor opposition. Various tactics were devised by workers, ranging from tangible procedures such as sabotage and working-to-rule to more subtle forms reflecting irony and contempt. We argue that the distinctive manifestations of domination emerging during the Lean programme stimulated particular forms of worker reaction, which are explained through fieldwork illustrations. Overall, we produce a theoretical explanation of domination and resistance that builds upon and extends the extant scholarship.
    Keywords: Ethnography,Domination,Resistance,Lean Production,Organizational Change
    Date: 2018–12
  14. By: Ortiz, Isabel,; Behrendt, Christina.; Acuña-Ulate, Andrés.; Nguyen, Quynh Anh.
    Abstract: This paper reviews proposals for a Universal Basic Income (UBI) in light of ILO standards. Some UBI proposals have the potential to advance equity and social justice, while others may result in a net welfare loss. The ILO Social Protection Floors Recommendation (No. 202) includes a number of principles which are highly relevant to guide the debate on UBI, namely: (i) adequacy and predictability of UBI benefits to ensure income security, set at least at the national poverty line; (ii) social inclusion, including of persons in the informal economy; (iii) social dialogue and consultation with stakeholders; (iv) enactment of national laws regulating UBI entitlements, including indexation of benefits; (v) coherence with other social, economic and employment policies, and (vi) sustainable and equitable financing. The impact of a UBI on poverty and inequality depends on the level of benefits and the source of funding. Based on these principles, the paper shows that some models of UBI can be in accordance with ILO standards, while others are not.
    Keywords: Latin America
    Date: 2018
  15. By: Francesco Vona (Observatoire français des conjonctures économiques); Giovanni Marin (University of Urbino); Davide Consoli (Institute of Innovation and Knowledge Management)
    Abstract: Addressing grand environmental challenges (e.g. climate change) entails adapting the skill base and, thus, the composition of the workforce. Recent interventions both in the form of environmental regulation or of subsidies – i.e. the American Recovery and Reinvestment Act (ARRA) of 2009 and its green component which accounts approximately for 15% of the overall fiscal stimulus – revived the debate on whether environmental policies create or destroy employment. However, existing empirical evidence on green employment is limited in terms of timespan and scope due to data constraints. In a recent study (Vona et al., 2018), we tackle this gap by elaborating a novel approach to measure green employment in US local labour markets. Using the task approach to approximate the time a worker spends in green activities (Acemoglu and Autor, 2011), allows us to provide a nuanced picture of how green employment has evolved in the turbulent period between 2006 and 2014 as well as a suggestive estimation of the effect of “becoming greener” for local labour markets. [First paragraph]
    Keywords: Green activities; Green employment; Us labor market
    Date: 2018–10

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