nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2021‒08‒09
twenty-two papers chosen by
Carlo D’Ippoliti
Università degli Studi di Roma “La Sapienza”

  1. Mission-Oriented Policies and the “Entrepreneurial State” at Work: An Agent-Based Exploration By Giovanni Dosi; Francesco Lamperti; Mariana Mazzucato; Mauro Napoletano; Andrea Roventini
  2. Transplantation of economic institutions: a post-institutional theory (expanded version) By Frolov, Daniil
  3. Generalized Darwinism: An Auxiliary Hypothesis By Spagano, Salvatore
  4. Norms that matter: Exploring the distribution of women's work between income generation, expenditure-saving, and unpaid domestic responsibilities in India By Ashwini Deshpande; Naila Kabeer
  5. Kritik KARL MARX terhadap kapitalisme By Ismirana, Alyaghina
  6. Sustainability and social policy nexus By Messkoub, M.
  7. Generation Post-COVID-19: The Time for Anti-Economics Has Come: Health, Minimalism and Rest By Julia M. Puaschunder
  8. Financialization revisited: the economics and political economy of the vampire squid economy By Thomas Palley
  9. From Oligopolistiic Digital Platforms to Open/Cooperative ones ? By Julienne Brabet; Lucy Taska; Corinne Vercher-Chaptal
  10. Eco-Critique and Thought as a Force of Nature By Stephanie Rhea Erev
  11. Sustainability of Global Economy as a Quantum Circuit By Antonino Claudio Bonan
  12. Heavy Tailed, but not Zipf: Firm and Establishment Size in the U.S. By Illenin O. Kondo; Logan T. Lewis; Andrea Stella
  14. Some hints about microeconomy as a quantum field theory and emergent macroeconomy By Antonino Claudio Bonan
  15. Perspektif Islam Dalam Hukum Industri Di Indonesia By , Asniar
  16. Sejarah Laissez Faire dan Kritik Karl Marx terhadap Merkantilisme By Pratiwi, Nurul
  17. Servitization across Countries and Sectors: Evidence from World Input-Output Data By Klaus S. Friesenbichler; Agnes Kügler
  18. What’s Worth Knowing? Economists’ Opinions About Economics By Peter Andre; Armin Falk
  19. Sustainability of Global Economy as a Quantum Circuit By Antonino Claudio Bonan
  20. Concentration, Retail Markups, and Countervailing Power: Evidence from Retail Lotteries By Giroldo, Renato; Hollenbeck, Brett
  21. Mekanisme Pasar Syariah By Iskandar, Isda
  22. The impact of cognitive skills on investment decisions. An empirical assessment and policy suggestions By Lorenzo Esposito; Lorenzo Marrese

  1. By: Giovanni Dosi (Laboratory of Economics and Management); Francesco Lamperti (Université Panthéon-Sorbonne - Paris 1 (UP1)); Mariana Mazzucato; Mauro Napoletano (Observatoire français des conjonctures économiques); Andrea Roventini
    Abstract: We study the impact of alternative innovation policies on the short- and long-run performance of the economy, as well as on public finances, extending the Schumpeter meeting Keynes agent-based model (Dosi et al., 2010). In particular, we consider market-based innovation policies such as R&D subsidies to firms, tax discount on investment, and direct policies akin to the “Entrepreneurial State” (Mazzucato, 2013), involving the creation of public research oriented firms diffusing technologies along specific trajectories, and funding a Public Research Lab conducting basic research to achieve radical innovations that enlarge the technological opportunities of the economy. Simu- lation results show that all policies improve productivity and GDP growth, but the best outcomes are achieved by active discretionary State policies, which are also able to crowd-in private investment and have positive hysteresis effects on growth dynamics. For the same size of public resources allocated to market-based interventions, “Mission” innovation policies deliver significantly better aggregate performance if the government is patient enough and willing to bear the intrinsic risks related to innovative activities.
    Keywords: Innovation policy, mission-oriented R&D, entrepreneurial state, agent-based modelling
    JEL: O33 O38 O31 O40 C63
    Date: 2021
  2. By: Frolov, Daniil
    Abstract: The transplantation of institutions, that is its copying from one country to another, is one of the most challenging areas of institutional economics. At the same time, the overwhelming majority of research on institutional transplantation is based on a set of general methodological principles and theoretical positions, which collectively might be termed the ‘classical theory’. Despite its persuasiveness and wide distribution (including outside the economic discourse), the classical theory of institutional transplantation has many built-in methodological limitations. It has a pronounced one-sided character, is based on reductionist approaches, and has problems with a systemic explanation of transplant processes in the modern economy. The article presents an interdisciplinary research program for the extended theory of institutional transplantation, based on the methodologies of post-institutionalism. The extended theory proposes to pay special attention to bottom-up transplants, as well as the role of institution-based communities – heterogeneous networks of internal and external actors of transplanted institutions. Adaptation of a transplanted institution to the new environment is viewed more as an active transformation of the environment by actors (institutional niche construction). The deviations from foreign prototypes arising in transplanted institutions are interpreted as adaptive refunctionalizations rather than transplant failures. Special emphasis is placed on the interactive communication field in which transplanted institutions develop. As a result of transplantation, it is proposed to consider not the dichotomy of successful adaptation and rejection of a new institution, but the emergence of institutional assemblage – a complex system of borrowed and local institutions based on irreducible institutional logics. A key metaphor for the extended theory is the formation of reef communities around artificial coral reefs.
    Keywords: transplantation of institutions; institutions; institutional environment; actors; assemblages; bricolage; narratives; discourses; niche construction
    JEL: B52
    Date: 2021–07–12
  3. By: Spagano, Salvatore
    Abstract: Human teleological intentionality represents the biggest challenge to a Darwinian metatheoretical framework including socio-economic domain. In order to face the problem, this paper introduces an auxiliary hypothesis: the human will has to be considered as a constitutive component of the socio-economic environment. This means that the human will is the place where evolutionary socio-economic events occur. This perspective absorbs the objection that Continuity Hypothesis theory addresses to Generalized Darwinism.
    Keywords: Generalized Darwinism, Continuity Hypothesis, Human intentionality
    JEL: B15 B25 B52
    Date: 2021–07–19
  4. By: Ashwini Deshpande; Naila Kabeer
    Abstract: Based on primary data from India, this paper analyses the reasons underlying women's low labour force participation. In developing countries, women engaged in unpaid economic work in family enterprises are often not counted as workers. Women are involved in expenditure-saving activities, i.e. productive work within the family, over and above domestic chores and care work. We document the fuzziness of the boundary between domestic and unpaid (and therefore invisible) productive work which leads to mismeasurement of women's work.
    Keywords: Female labour force participation, India, Social norms, Unpaid labour
    Date: 2021
  5. By: Ismirana, Alyaghina
    Abstract: Untuk mengetahui apa itu kapitalisme dan kritik KARL Marx terhadap kapitalisme
    Date: 2021–06–25
  6. By: Messkoub, M.
    Abstract: Social policies predate the welfare state and have left their mark on the genesis and development of the welfare state in different countries, that testifies to the importance of historical and ideological path-dependencies of social policies in different countries. The political/political-economy ecology literature links theories of social welfare and welfare state to environmental issues like resource use through the relationship between economic growth and sustainability. Orthodox mainstream neo-classical and Keynesian economics rely on economic growth in order to raise living standards but using different channels and mechanisms. It is this reliance on economic growth and its depletive effect on environmental resources that has lied at the heart of the critiques of growth oriented liberal/neo-liberal or Keynesian economic policies, and for that matter, economic policies of centralised economies of socialist countries. This paper will start with a critique of conservative environmentalism that is inspired by Malthusian population pressure (with all its social policy implications), that to some extent also informs the degrowth approach. It would then ask how to meet the increasing health, education and other social needs whilst minimising the depletion of natural resources. I argue that the answer to the question of a sustainable social policy in part lies in an economic model, a la Kalecki and others, that can manage/negotiate the composition of output whilst investing in resources to reduce depletion of natural resources and greenhouse emissions. This is a growth strategy based on ‘the human theory of needs’ that meets the needs of current generation and provides some measure of inter-generational justice. The welfare and social policy counterpart of this should involve public and collective provisioning of socially necessary services of health and education as well as a range of other care services that will reduce per capita cost through economies of scale and scope whilst providing an equitable access to these services – universal provision and access and not targeting is at the heart of this approach.
    Keywords: Sustainable economy, growth/degrowth, sustainable social policy, distribution
    Date: 2021–07–20
  7. By: Julia M. Puaschunder (The New School, Department of Economics, USA)
    Abstract: This paper makes the heterodox economic case of missing attention to health, minimization and rest in business, finance and economics. The COVID-19 pandemic has been addressed as a once-in-a-lifetime opportunity to a Great Reset. Started at the end of 2019, COVID-19 has been spreading around the world for over a year by now and no clear end is foreseeable yet. While vaccination and medication opportunities to cure the disease have improved impressively and steadily, the COVID-19 healthcare crisis also entails around 10 to over 30% of previously COVID-infected to be suffering from long haul symptoms. While our first understanding of post-COVID infection long haul symptoms, impetus and cure is still missing, there is hardening evidence that the newly emerging Generation COVID-19 Long Haulers may comprise of 0.3-1.659 billion previously infected with recurrent symptoms of fatigue, headaches and breathing problems as well as a set of debilitating memory fog and emotional distress. With this generation of COVID-19 Long Haulers, who are by around 70-75% female and of a median age in their 30s and 40s, a dramatic shift to demand for health, minimalism and rest is predicted to emerge. Neoclassical ideas of business, finance and economic research have a limited understanding of health. Maximization pledges of productivity driven industries in business, finance and economics do not account for minimalism. Foremost behavioral economics started to address cognitive overload and decision-making failures in a too complex world. There is no appreciation for rest in finance and economics. All these trends of attention to health, minimalism and rest the COVID-19 Long Haulers generation may change lastingly.
    Keywords: Behavioral economics, Business, Coronavirus, COVID-19, Crisis, Debilitation, Economics, Emotional impairment, Fatigue, Finance, Headaches, Heterodox Economics, Generation COVID-19 Long Haulers, Healthcare, Medication, Memory fog, Minimalism, Preventive care, Respiratory symptoms, Rest, Self-measurement, Vaccination
    Date: 2021–05
  8. By: Thomas Palley (Economics for Democratic and Open Societies (US))
    Abstract: This paper explores the economics and political economy of financialization using Matt Taibbi’s vampire squid metaphor to characterize it. The paper makes five innovations. First, it focuses on the mechanics of the “vampire squid” process whereby financialization rotates through the economy loading sector balance sheets with debt. Second, it identifies the critical role of government budget deficits for the financialization process. Third, it identifies the critical role of central banks, which are the lynchpin of the system and now serve as de facto guarantors of the value and liquidity of private sector liabilities. Fourth, the paper argues financialization imposes a form of policy lock-in. Fifth, it argues financialization transforms popular attitudes and understandings, thereby generating political support despite poor economic outcomes. In effect, there is a politics of financialization that goes hand-in-hand with the economics. The paper concludes with some observations on why mainstream macroeconomics has no equivalent construct to financialization and discusses the disquieting unexplored terrain that the economy is now in.
    Keywords: financialization, debt, central banks, lock-in
    JEL: E10 E44 E58 G18
    Date: 2021–07
  9. By: Julienne Brabet; Lucy Taska; Corinne Vercher-Chaptal (CEPN - Centre d'Economie de l'Université Paris Nord - UP13 - Université Paris 13 - USPC - Université Sorbonne Paris Cité - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Based on a literature review, this paper explores the disruptive nature of digitalization and the oligopolistic digital platforms that embody it, as well as the promises and difficulties of emergent open cooperative platforms. Before analysing the main questions raised by those platforms, we first propose a brief analysis of the digitalization process as a socio-technical mutation, of its risks and opportunities through four prospective scenarios. We then build a typology of the oligopolistic platforms at the heart of the present phase of digitalization that cooperative/open platforms aim to supplant or at least to challenge. Could the combination of the new open source movement, with the principles developed for successful commons and those of the older cooperatives offer an alternative? The obstacles are huge, and the questions raised much more abundant than the answers brought by theory and/or experimentation. The development of alternative platforms is thus questioning modes of: Distribution of the bundles of rights and governance; Centralization and decentralization; Autonomy and synergy; Choice of activities; Growth; Differentiation, standardization, convergence and hybridization; Localisation, globalisation and glocalization; Fair pricing; Organization of work, protection of workers and more largely citizen; Inclusion and exclusion of stakeholders; Funding; Relationship to the State and private or public entities ... among other, often combined, dimensions. Most importantly, alternative platform development also questions the capacity for cooperation of a highly socialized human nature.
    Keywords: Alternative Platforms,Oligopolist Platforms,Digitalization
    Date: 2020–12–04
  10. By: Stephanie Rhea Erev
    Keywords: political theory; new materialism; friedrich nietzsche; jamaica kincaid; transfiguration; affirmation; climate catastrophe; timothy luke; anthropocene; critical theory; eco-critique
    Date: 2020–10–01
  11. By: Antonino Claudio Bonan (ARPAV - Agenzia Regionale per la Prevenzione e la Protezione Ambientale del Veneto)
    Abstract: In economy, viewed as a quantum system working as a circuit, each process at the microscale is a quantum gate among agents. The global configuration of economy is addressed by optimizing the sustainability of the whole circuit. This is done in terms of geodesics, starting from some approximations. A similar yet somehow different approach is applied for the closed system of the whole and for economy as an open system. Computations may partly be explicit, especially when the reality is represented in a simplified way. The circuit can be also optimized by minimizing its complexity, with a partly similar formalism, yet generally not along the same paths.
    Keywords: Geometric optimization,Econophysics,Quantum economics,Quantum computation
    Date: 2021–07–20
  12. By: Illenin O. Kondo; Logan T. Lewis; Andrea Stella
    Abstract: Heavy tails play an important role in modern macroeconomics and international economics. Previous work often assumes a Pareto distribution for firm size, typically with a shape parameter approaching Zipf’s law. This convenient approximation has dramatic consequences for the importance of large firms in the economy. But we show that a lognormal distribution, or better yet, a convolution of a lognormal and a non-Zipf Pareto distribution, provides a better description of the U.S. economy, using confidential Census Bureau data. These findings hold even far in the upper tail and suggest heterogeneous firm models should more systematically explore deviations from Zipf’s law.
    Keywords: Firm size distribution, TFP distribution, Lognormal, Pareto, Zipf’s law, Granularity
    JEL: L11 E24
    Date: 2021–07
  13. By: , Nirwana
    Abstract: Islamic business ethics ismorality in running a business in accordance with Islamic values, so that in conducting business there is no need to worry, because it is believed to be something good and true. Ethical values, morals, ethics or morals are the values that encourage human beings to be a whole person. Such as honesty, truth, justice, independence, happiness and love. When these ethical values are implemented it will perfect the human reality as a whole. Every one can have a set ofknowledge about values, but the knowledge that directs and controls the behavior of Muslims there are only two, namely the Qur'an and hadith as the source of all values and guidelines in every joint of life, including in business. Ethics or morals have a very important position for human life, both as individual members of society and members of a nation. The wealth, the glory of the people one arthdepends on their morals, and the damage one arth is nothing but also due to the depravity of human morality it self. Human life requires morality, without morality human life is impossible to take place.
    Date: 2021–07–08
  14. By: Antonino Claudio Bonan (ARPAV - Agenzia Regionale per la Prevenzione e la Protezione Ambientale del Veneto)
    Date: 2021–07–27
  15. By: , Asniar
    Abstract: In the Law of the Republic of Indonesia Number 3 of 2014 concerning industri "Industry is all forms of economic activity that processes raw materials and/or utilizes industrial resources so as to produce goods that have added value or higher benefits, including industrial services". Industry is a branch of the economy whose rate of productivity development is faster than the development of the overall productivity level of the economic branch. So its role in creating production and creating jobs is certainly bigger than all branches of the economy. Humans are legal subjects as well as unique and prospective economic actors, with the development of all needs from all industrial sectors as Muslims are required to be within the framework of sharia rules, namely halal and ethical frameworks, namely thayib. So Islam is here to help develop the halal industri, especially in Indonesia so that it becomes a high economic value and is also profitable because it is based on sharia.
    Date: 2021–07–06
  16. By: Pratiwi, Nurul
    Abstract: Laissez faire adalah berasal dari bahasa Prancis yang artinya ‘biarkan terjadi’/biarkan berbuat. Sebutan tersebut berasal dari diksi Perancis yang digunakan psiokrat pada abad ke 18 sebagai bentuk perlawanan terhadap penerobosan pemerintah dalam perdagangan. Laissez faire merupakan persamaan untuk ekonomi pasar bebas yang selama awal dan pertengahan abad ke 19 sudah sangat selektif. Laissez faire ini dapat dimaksudkan sebagai sebuah konsep ekonomi yang tidak memiliki ataupun menginginkan kerja sama dengan pemerintah dalam perekonomian.
    Date: 2021–06–26
  17. By: Klaus S. Friesenbichler; Agnes Kügler
    Abstract: We use the supply tables that underlie WIOT data to explore the provision of services by manufacturing sectors. The value-added shares generated by services differ substantially across countries and sectors, while they remain largely stable over time. A Bayesian classification assigns broadly defined manufacturing sectors to economy-wide growth models. It differentiates between service- and manufacturing driven models in catching up and developed economies. Servitization increase with labour productivity. The service intensities in the sectoral production mix are lower in countries with higher manufacturing shares. This holds for both catching up and developed economies. However, servitization is largely unrelated to productivity and employment growth. Hence, we argue that the degree of servitization is contingent on and an attribute of the respective economic model in which a sector operates.
    Keywords: Servitiziation, employment, productivity, latent class analysis, WIOD
    Date: 2021–08–04
  18. By: Peter Andre; Armin Falk
    Abstract: We document economists’ opinions about what is worth knowing and ask (i) which research objectives economic research should embrace and (ii) which topics it should study. Almost 10,000 economic researchers from all fields and ranks of the profession participated in our global survey. Detailed bibliometric data show that our sample represents the population of economic researchers who publish in English. We report three main findings. First, economists’ opinions are vastly heterogeneous. Second, most researchers are dissatisfied with the status quo, in terms of both research topics and objectives. Third, on average, respondents think that economic research should become more policy-relevant, multidisciplinary, risky and disruptive, and pursue more diverse topics. We also find that dissatisfaction with the status quo is more prevalent among female scholars and associated with lower job satisfaction and higher stress levels. Taken together, the results suggest that economics as a field does not appreciate and work on what economists collectively prefer.
    JEL: A11 A14
    Date: 2021–07
  19. By: Antonino Claudio Bonan
    Abstract: In economy, viewed as a quantum system working as a circuit, each process at the microscale is a quantum gate among agents. The global configuration of economy is addressed by optimizing the sustainability of the whole circuit. This is done in terms of geodesics, starting from some approximations. A similar yet somehow different approach is applied for the closed system of the whole and for economy as an open system. Computations may partly be explicit, especially when the reality is represented in a simplified way. The circuit can be also optimized by minimizing its complexity, with a partly similar formalism, yet generally not along the same paths.
    Date: 2021–07
  20. By: Giroldo, Renato; Hollenbeck, Brett
    Abstract: In this note, we investigate the causal link between market concentration and markups in a retail setting. We study the Washington retail cannabis industry, which features exogenous variation in market concentration that resulted from retail licenses being awarded via lotteries. We observe markups directly. We find a negative causal relationship between markups and concentration, where more concentrated markets have significantly lower markups and wholesale prices. The results provide direct evidence of countervailing buyer power by retailers. These results highlight the value of using industry specific data and rich models of competition to advance the debate on concentration and markups.
    Keywords: markups, market concentration, retail, countervailing buyer power, cannabis policy
    JEL: E20 L13 L16 L22 L41 L81 M31 R12 R32
    Date: 2021–07–31
  21. By: Iskandar, Isda
    Abstract: This article, explain about how the mechanism of Islamic market, as we know that market is a place to exchange of goods or services. Islam, places the market on an important position on economy. Basically, Islamic Economy want a free market mechanism that can makes a fair price that obtained based on supply and demand, and there shouldn’t be disturbance that causes the market balance being damaged. But in reality, it’s a difficult thing to find a market that runs fairly. We call this condition market distortion. In the reality, market distortions still occur frequently, so that it can harm the parties involved as market participants.
    Date: 2021–07–06
  22. By: Lorenzo Esposito (Dipartimento di Politica Economica, DISCE, Università Cattolica del Sacro Cuore – Banca d'Italia, Milano); Lorenzo Marrese (DISCE, Università Cattolica del Sacro Cuore)
    Abstract: Results of behavioral economics pose a strong challenge to mainstream finance theory conclusions. We discuss, theoretically and empirically, the connections of cognitive skills, biases and financial decisions using the Cognitive Reflection Test (Frederick, 2005). In particular, we have chosen overconfidence, risk aversion, bandwagon effect, time preference and money illusion, among the biases most discussed in the literature. The experiment we conducted confirmed a role of the cognitive skills in determining the decision mechanism of the investor although not neatly, especially for more complex biases, such as money illusion. Finally, we expose policy alternatives, focusing on the role of financial education to tackle cognitive biases in finance and monetary policy.
    Keywords: cognitive biases, financial education, behavioral economics, CRT
    JEL: G41
    Date: 2021–07

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