nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2019‒04‒01
sixteen papers chosen by
Carlo D’Ippoliti
Università degli Studi di Roma “La Sapienza”

  1. La economía social ante los paradigmas económicos emergentes: innovación social, economía colaborativa, economía circular, responsabilidad social empresarial, economía del bien común, empresa social y economía solidaria By Rafael CHAVES ÁVILA Author-X-Name-First: Rafael; José Luis MONZÓN CAMPOS
  2. What did you do before? Moral (in)consistency in pro-environmental choice By Sophie Clot; Gilles Grolleau; Lisette Ibanez
  3. The Nature of Excessive Behavior (ISRAF) in the Islamic Economic Framework By Zein Muttaqin
  4. Expensive to be a Female Trader: The Reality of Taxation of Flea Market Traders in Zimbabwe By Ligomeka, Waziona
  6. Economics of Climate Change: Introducing the Basic Climate Economic (BCE) Model By Lucas Bretschger; Christos Karydas
  7. Producers of food and creators of social value: Women and alternative agriculture By Newsome, Lucie; Sheridan, Alison; Smith-Ruig, Theresa
  8. Advancing Systems Thinking in Evaluation: A Review of Four Publications By Margaret B. Hargreaves; Donna Podems
  9. Spirituality and Entrepreneurs: Analysis of Entrepreneurial Motivation By Ni Putu Nursiani
  10. Die Wirkmacht der 'Liebe zum Markt'. Zum anhaltenden Einfluss ordoliberaler OekonomInnen-Netzwerke in Politik und Gesellschaft (The 'love for markets'. On the persistent political and societal impact of networks of ordoliberal economists) By Stephan Puehringer; Walter Oetsch
  11. An overview of German new economic sociology and the contribution of the Max Planck Institute for the Study of Societies By Wilkinson, John
  12. Moral Pluralism in Behavioural Spillovers: A cross-disciplinary account of the multiple ways in which we engage in moral valuing By Vincent, Michael; Koessler, Ann-Kathrin
  13. Autonomy of profit rate distribution and its dynamics from firm size measures: A statistical equilibrium approach By Oh, Ilfan
  14. A multi-agent methodology to assess the effectiveness of alternative systemic risk adjusted capital requirements By Iori, G.; Gurgone, A.
  15. Innovation waves and technological transitions: Sweden, 1909-2016 By Taalbi, Josef
  16. General stopping behaviors of naïve and non-committed sophisticated agents, with application to probability distortion By Yu-Jui Huang; Adrien Nguyen-Huu; Xun Yu Zhou

  1. By: Rafael CHAVES ÁVILA Author-X-Name-First: Rafael (IUDESCOOP - Facultad de Economía, Universitat de València, Spain); José Luis MONZÓN CAMPOS (IUDESCOOP - Facultad de Economía, Universitat de València, Spain)
    Abstract: The social economy facing emerging economic concepts: social innovation, social responsibility, collaborative economy, social enterprises and solidarity economy. In the last two decades and prominently since the economic crisis and the crisis of legitimacy of the prevailing economic model based on for profit private businesses, a plurality of terms and notions have emerged in the academic field and in the economic and political world. They are concepts such as the social enterprises, the solidarity economy, the collaborative economy, the circular economy, the economy of the common good, the fourth sector, the social innovation and the corporate social responsibility. The objective of this paper is to explain this new wave of notions, to study their meanings and to identify their differences and commonalities in relation to the consolidated concept of social economy. This work is based on the 5 study carried recently for the European Economic and Social Committee (Monzón & Chaves, 2017). Within the framework of the Kuhn's theory of the scientific revolutions, in this paper we have proposed that in the social sciences, major changes in paradigms or scientific revolutions, and with them, changes in the language and concepts that generate a new worldview, are produced simultaneously to the great crisis and socio-economic transformations. In this framework, for the recent history, we have identified two periods of scientific revolutions in the field of the social economy / third sector, which we have called 'conceptual waves' and, between them, a period of normal science. The first wave of concepts appeared in the late seventies and eighties, with the oil crisis. During this first wave, the concepts of the social economy and of the nonprofit emerged. As rival approaches they coexisted as mainstream normal science until the second wave. The second wave of notions came out during the current economic crisis and the legitimization of the prevailing economic model. Other explanatory factors, linked to the sociology of the social scientist and of sociopolitical type, may also have influenced this proliferation of notions, such as the scientist pressure for differentiation and originality, and the positioning of some institutions in favor of some terms and against others. The social economy concept continues to be, with that of nonprofit organizations, the mainstream paradigm to refer to the 'space between the public economy and the private for profit economy'. It has a broad scientific and political consensus regarding its definition, it is well institutionalized and quantified and it has a strong scientific and social notoriety. It is a concept based on structural criteria, such as its social aims, its participatory and democratic decisional criterion and its profit distributive criterion based on the prevalence of people and labor factor over capital. Finally, it is not reduced to a few classical legal forms. Between these two main concepts of the “first wave” there are significant differences in terms of their scope and their structural criteria, as well as in terms of their systemic functions. Their main differences focus on the importance given to the social mission and the democratic criterion in the social economy approach and on the relevance of the distributive criterion, based on the non-distribution constraint, in the second approach. The following conclusions have been obtained from a detailed analysis of the different emerging concepts. First, given its novelty, there is still no broad consensus regarding their definitions. Terminological inflation is then joined by a semantic inflation. Secondly, these notions present are still in an incipient institutionalization process, if we attend their inclusion in official documents or position papers of the European institutions. Thirdly, they still present a low level of academic and social 6 notoriety, measured by their presence in specialized academic search engines, such as Dialnet and Google Scholar. From its semantic comparative analysis with that of the social economy, it can be seen that they are not rival concepts with the latter, but rather complementary and even revitalizing concepts of the social economy concept itself. This conclusion has been reached using the following typology of these concepts: Group 1, notions linked to the main challenges/fields of the system crisis and transformation; Group 2, notions linked to the reorientation of the objectives and governance of organizations and economies, both at the micro and macro level, with new assess and incentive mechanisms; and finally, Group 3, notions linked to new ways of understanding entrepreneurship. In the first group are included the concepts of social innovation, collaborative economy and circular economy, which refer to areas of system transformation such as, respectively, innovation, the digital revolution and the environment. They are transversal areas to the public, business private for-profit sector and third sector, and these paradigms constitute new approaches, both micro and macro, to face the challenges. In the second group are the notions of corporate social responsibility and the common good economy, which refer to the need to establish new mechanisms for evaluating economic performance and new incentive mechanisms that prioritize the social dimension. They are also transversal to the public, for-profit sector and third sector. Finally, the notions of social enterprise, social entrepreneurship, fourth sector and solidary economy are integrated in the third group. These last notions refer to specific entities and enterprises. In the case of social enterprises and the solidarity economy, their proximity to the social economy is maximum, to the point of being considered part of the latter. The importance of the participatory and deliberative dimension of the solidary economy concept has undoubtedly contributed to the emergence in Europe of another new term, integrating both: the 'social and solidarity economy'. In summary, the new notions that have emerged in the context of the crisis of legitimacy of the hegemonic economic model must be considered complementary and even revitalizing with respect to the concept of the social economy.
    Keywords: Social Economy, Nonprofit sector, Solidarity Economy, Collaborative Economy, Social Enterprises, Social Innovation, Social Responsibility, Scientific revolutions
    JEL: L20 L31 M14 P13
    Date: 2018
  2. By: Sophie Clot (UOR - University of Reading); Gilles Grolleau (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - INRA - Institut National de la Recherche Agronomique - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier, CEREN - Centre de Recherche sur l'ENtreprise [Dijon] - BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC)); Lisette Ibanez (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - INRA - Institut National de la Recherche Agronomique - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)
    Abstract: Rather than just examining moral licensing and cleansing at an aggregate level, we investigate experimentally the moral dynamics at an individual level. We also propose a formal definition of moral consistency or inconsistency (i.e., moral licensing and/or moral cleansing). We found that half our sample present inconsistent pro-environmental behaviour, independently of the way behavior is elicited (positive or negative framing). Men seem to behave more consistently over time, but when they compensate, they license (respectively cleanse) in a higher (respectively lesser) extent than women. We suggest that policies can improve their performances by avoiding a ‘one size fits all approach' and take into account this heterogeneity of moral dynamics.
    Keywords: taking game,dictator game,moral in(consistency),licensing,cleansing
    Date: 2018
  3. By: Zein Muttaqin (Department of Economics, Kulliyah of Economic and Management Sciences, International Islamic University Malaysia, Malaysia. Author-2-Name: Author-2-Workplace-Name: Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)
    Abstract: Objective – The objective of this paper is to unfold the nature of excessive behavior in the Islamic economics framework. Methodology/Technique – This is a library research based on the various studies that specifically discuss excessive behavior and Islamic consumer behavior. The study uses a rating system to identify the relevance of content to the study and analyze content analysis. Findings – The nature of excessive behavior is condemned by Islam and is fully agreed upon by Muslim scholars. The extent of excessive behavior is not limited to certain levels of consumption. The Muslim consumer may unaware of doing the practice under the influence of a particular setting, where the pleasure of the practice is felt temporarily. Novelty – This study clarifies the terminology and nature of excessive behavior, which is unclear in previous studies conducted by Muslim scholars. Type of Paper: Review
    Keywords: Excessive Behavior; Islamic Economics; Consumer Behavior; Miscellaneous.
    JEL: A13 D01 P40 Y80
    Date: 2019–03–17
  4. By: Ligomeka, Waziona
    Abstract: The proportion of economic activities that are categorised as informal or small-scale is unusually high in Zimbabwe. Given the depressed state of the economy over an extended period, it is logical that the government is more actively taxing small-scale business activities. Specifically, in 2005 the government introduced a presumptive tax (a tax on gross income), to be paid by small-scale traders in some businesses. The presumptive tax was broadened to include more small-scale businesses in 2011. While increasingly more of the small-scale sector is being subjected to the presumptive tax, little is known about the impact of this tax on the traders themselves – particularly its impact on women, who make up the majority of small-scale traders in Zimbabwe. This study aims to unravel the reality of taxation in Zimbabwe’s small-scale sector by focusing on flea market traders. The research involved interviewing small-scale traders in flea markets around Harare and Bulawayo, government officials and members of a smallscale traders association, and focus group discussions with flea market traders. This paper analyses the different types of tax payments that flea market traders make, the proportion of their income paid in taxes, and gender disparity in flea market trader taxation. Using a representative taxpayer approach, it finds that flea market traders pay a higher proportion of their income in taxes than formal traders, and therefore taxes paid by flea market traders are highly regressive. Women who operate in flea markets are more adversely affected by taxes because they earn a lot less than men (and are thus affected by the regressive nature of informal taxes), and because the markets in question have more women than men. The paper considers the implications of these findings on tax policy as it pertains to small-scale traders in general, and specifically to flea market traders.
    Keywords: Finance, Gender, Governance,
    Date: 2019
  5. By: Dagmara Nikulin (Gdansk University of Technology, Gdansk, Poland; Gdansk University of Technology, Gdansk, Poland); Joanna Wolszczak-Derlacz (Gdansk University of Technology, Gdansk, Poland); Aleksandra Parteka
    Abstract: This paper investigates how involvement in Global Value Chains (GVCs) affects working conditions. We use linked employer-employee data from the Structure of Earnings Survey merged with industry-level statistics on GVCs based on the World Input-Output Database. The sample consists of almost 9 million workers in 24 European countries in 2014. Given the multidimensional nature of the dependent variable, we compare the estimates resulting from a Mincerian wage model with zero-inflated negative binomial regressions that analyse other aspects of working conditions (overtime work and bonus payments). As to the impact of production fragmentation on social upgrading, wages prove to be negatively related to sectoral GVC involvement. Workers in sectors more deeply involved in GVCs have lower and less stable earnings, meaning worse working conditions; on the other hand, they are also less likely to have to work overtime, which one may see as a sign of better labour standards.
    Keywords: working conditions, Global Value Chains, wellbeing of workers, social upgrading
    JEL: F16 J81
    Date: 2019–02
  6. By: Lucas Bretschger (ETH Zurich, Switzerland); Christos Karydas (ETH Zurich, Switzerland)
    Abstract: The paper develops the Basic Climate Economic (BCE) model featuring the core elements of climate economics and climate policy. The BCE model incorpo- rates fossil stock depletion, pollution stock accumulation, endogenous growth, and climate-induced capital depreciation. We first use graphical analysis to show the effects of climate change and climate policy on economic growth. In- tuition for the different model mechanisms, the functional forms, and the effects of different climate policies is provided. We then show the model equations in mathematical terms to derive closed-form solutions and to run model simula- tions relating to the graphical part. Finally, we compare our setup to other models of climate economics.
    Keywords: Climate change, endogenous growth, climate policy, resource use, stock pollution
    JEL: Q43 O47 Q56 O41
    Date: 2018–09
  7. By: Newsome, Lucie; Sheridan, Alison; Smith-Ruig, Theresa
    Abstract: The literature on alternative agriculture has highlighted producer values of supplying locally, producing high quality products, farming sustainably and community engagement. This exploratory paper examines the motivations of four female alternative agricultural producers in the Australian context. Alternative agriculture in the US context has been extensively researched, but little is known about the practices in Australia. This exploratory study reveals the importance of community and place to these women, and adds to our understanding of gender and alternative agriculture in the Australian context. Rather than their presence being simply the result of easier access for women than the traditional agricultural environment, we find these women exercising agency as they pursue alternative agriculture. The values of social and environmental sustainability are core to these producers’ farming identities and while they are prioritised over profit motives, as consumers become more conscious of food origin and food miles, adherence to these values does enable financial business success.
    Keywords: Labor and Human Capital
    Date: 2019–02
  8. By: Margaret B. Hargreaves; Donna Podems
    Abstract: This article reviews four books published in 2010 and 2011 on the topic of systems thinking in evaluation.
    Keywords: Systems Thinking , Complexity Theory , Developmental Evaluation , Program Theory
    JEL: I
  9. By: Ni Putu Nursiani (Faculty of Economics and Business, Nusa Cendana University Author-2-Name: Rolland Epafras Fanggidae Author-2-Workplace-Name: Villa College, 20373, Male,' Maldives Author-3-Name: Ronald P.C Fanggidae Author-3-Workplace-Name: Nusa Cendana University, Adisucipto, 85228, Kupang, Indonesia Author-4-Name: Samuel Messakh Author-4-Workplace-Name: Nusa Cendana University, Adisucipto, 85228, Kupang, Indonesia Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)
    Abstract: Objective – Cultural change in the economy has given rise to what might be called 'spiritual entrepreneurship'. The purpose of this paper is to explore the relationship between entrepreneurship and spirituality, even though these two terms are somewhat contradictory. Methodology/Technique – The sample in this study consists of 63 members of the Full Gospel Business Fellowship International (FGBMFI) which is a membership consisting of male businessmen who come from various churches with different business backgrounds. The method used in this study is descriptive analysis. The data was collected using a questionnaire that led to the excavation of information based on previous theoretical studies. The informant selection technique used in this research is accidental. Findings – The results of this study support the findings of previous research in the field of "Spirituality Workplace" and introduces a new model in the field of entrepreneurship. Novelty – Spirituality is a process of human reason in which individual's aim to reach and understand God. On the other hand, entrepreneurs are people who have the courage to take risks to create a business. Hence, in this study, spiritual entrepreneurs refers to people who run their business in line with the values of ethics and religion. Those entrepreneurs interpret their work as worship, honesty and gratitude in addition to usual entrepreneurial behavior (innovation, proactive, competitive aggressiveness, risk taking, autonomy).
    Keywords: Entrepreneurship; Spirituality; Spiritual Entrepreneurs
    JEL: M30 M39
    Date: 2019–03–06
  10. By: Stephan Puehringer (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria); Walter Oetsch (Cusanus Hochschule Bernkastel-Kues, Germany)
    Abstract: In this paper we aim to contribute to the current debate on the impact of ordoliberal thought in economic policy debates in Germany. Our approach is twofold: On the one hand we examine the market fundamental logic of early ordoliberal scholars. On the other hand we apply a social network analysis and highlight the ongoing political and public impact of ordoliberal economists until today.
    Keywords: ordoliberalism, market fundamentalism, social network analysis, social studies of economics, performativity of economic thought
    Date: 2019–03
  11. By: Wilkinson, John
    Abstract: New economic sociology (NES) in Germany has many similarities with economic sociology in the United States in its conscious efforts to institutionalize its presence within the broader sociology community, its promotion of a canon via handbooks, and its focus on the sociology of markets. At the same time, it differs in its stronger connections to the German classics, the greater vitality of a macrosociological tradition in Germany, the prior existence of a "bridging" generation of economic sociologists, and its later consolidation in a period of neo-liberal globalization, all of which have given NES in the German-speaking world a distinctive character. In addition, it has been influenced by successive waves of French economic sociology - Bourdieu, convention, and actor-network theory - and its bilingual academic tradition has ensured its integration into English-speaking NES. In its contribution to the sociology of markets, the fact that NES emerged later in Germany than in the US led to a greater concern with quality markets rather than commodity markets, and a concomitantly greater attention to issues of value and price. These latter themes, in their turn, establish a continuity with German economic sociology's enduring concern with understanding the role of money. Not surprisingly, therefore, German NES is now making key contributions to discussions on the sociology of money and is increasingly situating its analysis within the broader dynamic of capitalism and current processes of financialization.
    Keywords: German economic sociology,Max Planck Institute for the Study of Societies and economic sociology,new economic sociology,deutsche Wirtschaftssoziologie,Max-Planck-Institut für Gesellschaftsforschung und Wirtschaftssoziologie,Neue Wirtschaftssoziologie
    Date: 2019
  12. By: Vincent, Michael; Koessler, Ann-Kathrin
    Abstract: In this article, we reflect critically on how moral actions are categorised in some recent studies on moral spillovers. Based on classic concepts from moral philosophy, we present a framework to categorise moral actions. We argue that with a finer classification of the moral values, associated behaviour is better understood, and this understanding helps to identify the conditions under which moral licensing takes place. We illustrate our argument with examples from the literature on pro-environmental behaviours. Moral spillovers are frequently studied in this behavioural domain and to understand what causes their occurrence is highly (policy) relevant if we wish to promote sustainable behaviour.
    Keywords: moral values,moral licensing,pro-environmental behavior,behavioral spillover,value pluralism
    Date: 2019
  13. By: Oh, Ilfan
    Abstract: This paper presents an empirical analysis of the distributional and dynamic properties of firm profit rates, measured by returns on assets, using panel data on 1095 long-lived Japanese (non-financial) listed firms over the 1971-2012 period. In particular, this paper tests the validity of statistical equilibrium approach of Alfarano et al. (2012), by investigating whether the two representative firm size measures of total assets and total sales are the significant determinants of key parameters ruling over the distributional outcome and stochastic motion of firm profit rates: a system-wide aver- age rate of profit, a system-wide dispersion measure of profit rates, and an idiosyncratic noise factor reecting individual firm characteristics. Employing information-theoretic model selection approach and standard panel data econometric techniques which control for both unobserved individual firm heterogeneity and time effects, this paper finds: (i) under the various levels of aggregation using the two size measures as firm classification instruments, the empirical density of profit rates is well described by the Laplace distribution; (ii) the key parameters characterizing the profit rate distribution and its dynamics are independent of the movements in firm size measures. These findings confirm the fundamental predictions from statistical equilibrium approach and the finding (ii) implies that firm competition is an autonomous system, immune to the size of individual firms.
    Keywords: diffusion process,firm size,Laplace distribution,long-lived firms,profit rate dynamics,statistical equilibrium
    JEL: C23 C52 D22
    Date: 2019
  14. By: Iori, G.; Gurgone, A.
    Abstract: We propose a multi-agent approach to compare the effectiveness of macro-prudential capital requirements, where banks are embedded in an artificial macroeconomy. Capital requirements are derived from systemic- risk metrics that reflect both the vulnerability or impact of financial in- stitutions. Our objective is to explore how systemic-risk measures could be translated in capital requirements and test them in a comprehensive framework. Based on our counterfactual scenarios, we find that macro- prudential capital requirements can mitigate systemic risk, but there is a trade-off between market- and balance-sheet-based policies in terms of banks’ losses and credit supply.
    Date: 2019
  15. By: Taalbi, Josef (Department of Economic History, Lund University)
    Abstract: There are important unresolved questions about long-term trends of in- novation activity and the nature of the interplay between innovation and economic development and transformation. This study explores the promise of a literature-based innovation output indicator, constructed for the Swedish engineering industry, 1909-2016. The findings suggest a long-run increasing trend in innovations per capita. Meanwhile, product innovations have also become more complex and it is suggested that crude innovation counts underestimate the long-run innovation performance. In order to analyse innovation and economic development across different frequencies, the study uses a wavelet decomposition approach. The results suggest that innovation activity has surged in periods of intense industry rationalization and struc- tural crisis (1930s, 1970s and 2010s) and that such pulses were intimately connected to the second and third industrial revolutions.
    Keywords: Innovation; Wavelet analysis; Technological systems
    JEL: N13 O14 O31
    Date: 2019–03–20
  16. By: Yu-Jui Huang (University of Colorado - Department of Applied Mathematics - University of Colorado Boulder [Boulder]); Adrien Nguyen-Huu (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - INRA - Institut National de la Recherche Agronomique - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier); Xun Yu Zhou (Columbia University [New York])
    Abstract: We consider the problem of stopping a diffusion process with a payoff functional that renders the problem time-inconsistent. We study stopping decisions of naıve agents who reoptimize continuously in time, as well as equilibrium strategies of sophisticated agents who anticipate but lack control over their future selves' behaviors. When the state process is one dimensional and the payoff functional satisfies some regularity conditions, we prove that any equilibrium can be obtained as a fixed point of an operator. This operator represents strategic reasoning that takes the future selves' behaviors into account. We then apply the general results to the case when the agents distort probability and the diffusion process is a geometric Brownian motion. The problem is inherently time-inconsistent as the level of distortion of a same event changes over time. We show how the strategic reasoning may turn a na¨ıve agent into a sophisticated one. Moreover, we derive stopping strategies of the two types of agent for various parameter specifications of the problem, illustrating rich behaviors beyond the extreme ones such as "neverstopping" or "never-starting".
    Keywords: equilibrium stopping law,naïve and sophisticated agents,probability distortion,time inconsistency,Optimal stopping,na¨ıvena¨ıve and sophisti-cated agents
    Date: 2018

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