nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2024‒03‒04
seventeen papers chosen by
Carlo D’Ippoliti, Università degli Studi di Roma “La Sapienza”

  1. Reviewing feminist macroeconomics for the XXI century By Zuazu-Bermejo, Izaskun
  2. An Evolutionary Approach to Regional Studies on Global Value Chains By Ron Boschma; ;
  3. Unpacking Social Order: Towards a Novel Framework that Goes Beyond Organizations, Institutions, and Networks Forthcoming in Critical Sociology By Michael Grothe-Hammer; Héloïse Berkowitz
  4. Comparative analysis of the evolution of the CE4 countries’ national innovation systems and their innovation performance in 2000–2020 By Attila Havas
  6. Between Sumner and Galton By Fiorito, Luca; Erasmo, Valentina
  7. Social Mechanics By Morales, Vicente
  8. Sustainable Development And Islamic Economics Paradigms Compared By Ezzedine Ghlamallah
  9. Beyond Green Preferences: Alternative Pathways to Net-Zero Emissions in the MATRIX model By Rizzati, Massimiliano; Ciola, Emanuele; Turco, Enrico; Bazzana, Davide; Vergalli, Sergio
  10. The Evolutionary Trajectory of EU Trade in Algae for Human Consumption By Zarbá, Carla; Scuderi, Alessandro; Matarazzo, Agata; Privitera, Donatella; Pecorino, Biagio; Chinnici, Gaetano
  11. The role of the state in shaping the internationalization of firms in the twenty-first century By Ricz, Judit; Sallai, Dorottya; Sass, Magdolna
  12. The reflux phase in monetary circuit theory and stock–flow consistent models By Edouard Cottin-Euziol; Hassan Bougrine; Louis-Philippe Rochon
  13. Why was Keynes keen to invest in American but not in British Investment Trusts? By Marcuzzo, Maria Cristina; Sanfilippo, Eleonora
  14. Does green innovation crowd out other innovation of firms? Based on the extended CDM model and unconditional quantile regressions By Yi Yiang; Richard S. J. Tol
  15. The ‘Missing Middle’: A Historical-Institutional Perspective on the Stagnation of Small and Medium Enterprises in Turkey By Seven Ağır
  16. Review of “A History of Ecological Economic Thought” by Marco P. Vianna Franco and Antoine Missemer By DesRoches, C. Tyler
  17. Productive robots and industrial employment: the role of national innovation systems By Kapetaniou, Chrystalla; Pissarides, Christoforos Antoniou

  1. By: Zuazu-Bermejo, Izaskun
    Abstract: Feminist macroeconomics draws on the notion that the gender system is both cause and consequence of macroeconomic structures, outcomes, and policies. In contrast, mainstream and heterodox macroeconomics have done little to integrate gender as an analytical tool in macromodelling. This paper defines the subfield of feminist macroeconomics, explores its origins, and provides a systematic review of its literature. Drawing on Seguino (2013), the paper divides the subfield in three main strands: i) feminist growth theory and gender dimensions of macrolevel policies, ii) macro-modelling and theoretical foundations of the care economy, and iii) social infrastructure and intra-household allocation. The paper discusses potential ways to expand the foci of feminist macroeconomic research, while considers challenges to the subfield, such as methodological issues regarding male-biased metrics and limited data availability, and the tensions with mainstream approaches to gender and the macroeconomy. Finally, the paper contextualizes the subfield in a post-pandemic era.
    Keywords: feminist macroeconomics, feminist growth theory, care economy, COVID-19 pandemic, economic methodology
    JEL: E0 E12 B54
    Date: 2024
  2. By: Ron Boschma; ;
    Abstract: There is an ongoing dialogue that explores how the Global Production Network and Evolutionary Economic Geography (EEG) literatures can make promising crossovers. This paper aims to contribute to this debate by outlining a theoretical-analytical approach to regional studies on Global Value Chains (GVCs). Building on the EEG literature on relatedness, economic complexity and regional diversification, this approach aims to develop a better understanding of the ability of regions to develop new and upgrade existing GVCs, and why regions may experience the loss or downgrading of existing GVCs. We present the features of this relatedness/complexity approach to GVCs, and discuss potential fields of applications.
    Keywords: Evolutionary Economic Geography, Global Value Chains, Global Production Networks, regional diversification, relatedness, economic complexity
    JEL: B52 F23 O19 O33 R10
    Date: 2024–01
  3. By: Michael Grothe-Hammer (NTNU Samfunnsforskning AS / NTNU Social Research - NTNU - Norwegian University of Science and Technology [Trondheim] - NTNU - Norwegian University of Science and Technology); Héloïse Berkowitz (LEST - Laboratoire d'Economie et de Sociologie du Travail - AMU - Aix Marseille Université - CNRS - Centre National de la Recherche Scientifique, AMU - Aix Marseille Université)
    Abstract: This article addresses one of the oldest, most fundamental questions: how social order comes about. Many established conceptions of social order either tend to overemphasize one specific form of social order like institutions or networks thereby losing sight of others, or subscribe to a single binary definition often distinguishing between spontaneous and organized social order. Although we do not deny the analytical fruitfulness of these approaches, we argue that they fall short when it comes to fully grasping certain social phenomena. Against this backdrop, we expand existing approaches by accounting for the multi-dimensionality of social order. Drawing on decisional organization theory, we present a theorization of social order that outlines four properties: ontology (system or structure), determination (decided or non-decided), changeability (decidable or non-decidable), and acceptance (accepted or contested). As we will show, this framework offers a fine-grained understanding of social orders on a more generalized level, accounting for the complex, relational and processual nature of social orders. This approach allows us to move beyond established categorizations of social phenomena into, e.g., institutions or networks, and to put the emphasis on properties of social orders, the identification of tipping points, the unpacking of complexity, and the analysis of potential incompatibilities.
    Keywords: Social order decided order institutions partial organization decisions decisional organization theory organization theory, Social order, decided order, institutions, partial organization, decisions, decisional organization theory, organization theory
    Date: 2024
  4. By: Attila Havas (Institute of Economics, HUN-REN Centre for Economic and Regional Studies, AIT Austrian Institute of Technology, Center for Innovation Systems and Policy)
    Abstract: This paper compares the evolution of CE4 countries’ (Czechia, Hungary, Poland, and Slovakia) national innovation systems, as well as their innovation performance. Its analytical framework draws on evolutionary (and institutional) economics of innovation. Given the structural features and the level of socio-economic development in the CE4 countries, as well as the dominant way of thinking since the cold war, Western politicians, business people, analysts and journalists tend to share a ‘block’ view of these countries. Further, there is a noticeable – and certainly understandable – ‘drive’ also from the academic community to produce findings that can be generalised across the new EU member states, but at least for the CE4 countries, that is, to focus on identifying shared or similar features. Yet a closer look at the structure of the national innovation systems in these countries, as well as at their innovation performance, points to a different direction. While the structural composition of the research sub-systems of the CE4 countries showed a great diversity already in 2000, fairly significant changes have occurred since then almost in all countries, adding more colours to the observed diversity. Neither a similar structural composition of the research sub-system can be observed, nor a move towards a similar structure. Their innovation performance is also diverse. Given the diversity among innovation systems, one should be very careful when trying to draw policy lessons from the ‘rank’ of a country as ‘measured’ by a composite indicator. The CE4 countries, therefore, need to avoid the trap of paying too much attention to simplifying ranking exercises. Instead, it is of utmost importance to conduct detailed, thorough comparative analyses, identifying the reasons for a reasonable or disappointing performance.
    Keywords: Keywords: Models of innovation; Economics paradigms; National innovation systems; STI policy rationales; Measurement of innovation; Composite indicators; Scoreboards and league tables; Czechia; Hungary; Poland; Slovakia
    JEL: B52 O30 O38 O39
    Date: 2023–12
  5. By: Barbieri, Fabio; Filho, Marcelo Lourenço
    Abstract: This article explores a debate on the theory of cost that occurred in the 1890s between economist Silas MacVane and Austrian economists. MacVane defended the idea of objective “real cost, ” while the Austrians argued for subjective opportunity cost. Although this debate is rarely mentioned, it represents a noteworthy episode of active contrast between ideas on value and cost, with implications that are relevant for contemporary economists. By highlighting the incompatibility of the objective and subjective conceptions of cost, this debate sheds light on the evolution of economic theory. The contributions of relatively unknown authors, such as MacVane and David Green, are also discussed. We interpret the debate in terms of the contrast between research programs based on wealth or exchange, and note that the gradual shift in the period regarding the fundamental problem that informs economic theory is key to understanding the modern concept of cost.
    Date: 2024–01–26
  6. By: Fiorito, Luca; Erasmo, Valentina
    Abstract: Largely forgotten today, Albert Galloway Keller was one of the foremost sociologists of his time. A brilliant scholar and a staunch disciple of William Graham Sumner, Keller spent his entire academic career at Yale, first as a student and then as Professor of the Science of Society, the chair formerly held by his mentor. The main coordinates of Keller’s sociology are to be found in his major work, Societal Evolution (1915), where he sought to apply Charles Darwin’s mechanism of variation, selection, and transmission to Sumner’s general scheme. Although Keller gave priority to social variables, his evolutionary sociology retained many elements of the typically Progressive Era preoccupations with heredity and the biological quality of individuals. The aim of this paper is to examine in some detail Keller’s views on eugenics and related issues, and to assess whether and to what extent these biologically deterministic elements played a role in his Darwinian approach to institutional change.
    Date: 2024–02–02
  7. By: Morales, Vicente (Cámara de Diputados)
    Abstract: Social physics is the application of ideas, concepts and tools from physics to study social phenomena. In this article, we present a mechanical theory underlying a mathematical treatment of social physics. We explore the possibility of using fundamental concepts like position, motion, inertia, and interaction, to effectively regard social phenomena analogously to particles interacting with each other in physics. From these concepts, along with heuristics of social change, we investigate the notions of free motion, motion under the influence of a net deterministic, as well as stochastic force. To test these ideas we model partisan preferences in the United States according to the outcomes of presidential elections.
    Date: 2024–02–09
  8. By: Ezzedine Ghlamallah (CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon)
    Abstract: The article, in three parts, compares the divergences and convergences between the paradigms of sustainable development and Islamic economics. The first part of this article deals with the sustainable development paradigm. This paradigm is analysed through its three-dimensional definition and the United Nations' Sustainable Development Goals. The second part characterizes the Islamic economics paradigm: Islamic economics is defined through a multidimensional approach and its objectives are outlined. The third section compares the two paradigms, revealing their divergence and convergence. The comparison shows that there is considerable conceptual convergence between these two paradigms and that their definitions and objectives converge insofar as they share the same universal ambition of achieving human well-being. These convergences can be observed in their theoretical models, dimensions, and values. They also share certain limitations, results, failures, and paradoxes.
    Abstract: Cette recherche se situe dans le contexte du développement d'un nouveau modèle unificateur pour répondre aux objectifs communs du développement durable et de l'économie islamique. L'article, articulé autour de trois parties, compare les divergences et les convergences existantes entre les paradigmes du développement durable et de l'économie islamique. La première partie de l'article traite du paradigme du développement durable (1). Ce paradigme est analysé à travers sa définition tridimensionnelle (1.1) ainsi qu'à travers les objectifs de développement durable des Nations-Unies (1.2). La seconde partie permet de caractériser le paradigme de l'économie islamique (2) : l'économie islamique est définie à travers une approche multidimensionnelle (2.1) et ses objectifs sont exposés (2.2). Une fois les deux paradigmes présentés, la troisième partie permet de les comparer (3) et fait apparaître leurs divergences (3.1) et convergences (3.2). La comparaison montre qu'il existe une convergence conceptuelle importante entre ces deux paradigmes et que leurs définitions et objectifs convergent dans la mesure où ils partagent la même ambition universelle de réalisation du bien-être humain. Ces convergences se retrouvent au niveau des modèles théoriques, des dimensions et des valeurs. Ils présentent également des limites, des résultats avec des constats d'échec et des paradoxes communs.
    Keywords: Sustainable Development, Islamic Economics, Environmental Management, Ethics, SDG
    Date: 2023–12–18
  9. By: Rizzati, Massimiliano; Ciola, Emanuele; Turco, Enrico; Bazzana, Davide; Vergalli, Sergio
    Abstract: Green preferences are often regarded as crucial factors in facilitating the energy transition. However, it is unclear if they can alone propel an economy towards achieving a net-zero emissions outcome. In this study, we expand the multi-agent integrated assessment model MATRIX by incorporating considerations on implicit emissions in the decision-making process of consumers and firms. To evaluate the efficacy of those green preferences, we construct a range of experiments encompassing varying degrees of pro-environmental attitudes. Those scenarios are then compared to more conventional incentive-based climate policies, such as a carbon tax and a Cap-and-Trade mechanism, with and without a subsidy for abatement technology, each implemented at different stringency. Our findings indicate that only exceptionally high and unrealistic values of green preferences for both firms and consumers can achieve a net-zero outcome in the absence of an active policy. Moreover, the most favorable scenario in terms of environmental, economic and distributional outcomes emerges from a carbon tax accompanied by a moderate subsidy. Without subsidy, policies entail mainly negative economic and distributional consequences as firms transfer the increased costs to consumers.
    Keywords: Environmental Economics and Policy, Research Methods/ Statistical Methods
    Date: 2024–02–15
  10. By: Zarbá, Carla; Scuderi, Alessandro; Matarazzo, Agata; Privitera, Donatella; Pecorino, Biagio; Chinnici, Gaetano
    Keywords: Consumer/Household Economics, International Relations/Trade
    Date: 2023–12
  11. By: Ricz, Judit; Sallai, Dorottya; Sass, Magdolna
    Abstract: The year 2020, with the outbreak of the COVID-19 pandemic and the subsequent crises, highlighted the significance of state intervention in shaping firm competitiveness. However, unprecedented government support for businesses has left us puzzled about the state’s role in firm internationalization, especially in emerging markets and the Global South, where government involvement has been accompanied by democratic backsliding and rising authoritarianism. Our Special Issue moves the current debate forward by exploring how the state’s changing role affects firm internationalization. The objective of this editorial is twofold: stimulating theory development by scrutinizing state intervention in emerging markets in recent decades and introducing the Special Issue articles. Contributions investigate how governments support the internationalization of their domestic businesses by focusing on firms’ institutional embeddedness and the impact of institutions as both resources and constraints to their internationalization. By linking the discourse on state capitalism with business internationalization, our empirical studies advance research on political economy and the state’s role in innovative ways, reflecting on recent geopolitical developments. Our introductory article situates the Special Issue papers in the state capitalism and firm internationalization literatures and discusses their implications for future research.
    Keywords: firm internationalization; state capitalism; institutional embeddedness; emerging markets; central and eastern Europe; Democratic governance in a turbulent age (Governance)’ grant no. 462-19-080 (POPBACK project); Sage deal
    JEL: R14 J01 L81
    Date: 2023
  12. By: Edouard Cottin-Euziol (LC2S - Laboratoire caribéen de sciences sociales - CNRS - Centre National de la Recherche Scientifique - UA - Université des Antilles); Hassan Bougrine (Laurentian University); Louis-Philippe Rochon (Laurentian University)
    Abstract: Stock–flow consistent (SFC) modelling and monetary circuit theory (MCT) have many similarities. However, an important difference concerns the reflux phase, during which the credits issued by banks are repaid. This phase is constitutive of MCT models, but does not generally appear explicitly in SFC models. The authors propose here to develop an SFC model in which the bank loans issued at the beginning of a period are explicitly repaid at the end of it. The repayment of long-term bank loans financing investments will then represent a leakage outside the monetary circuit and affect the level of aggregate demand and the dynamics of the model. The authors show that considering these repayments could have a lasting effect on corporate profits, corporate indebtedness, and growth of production. This result suggests that it could be interesting to focus more on the reflux phase within SFC models, taking inspiration from MCT.
    Keywords: monetary circuit, stock–flow consistency, reflux, bank loans
    Date: 2024
  13. By: Marcuzzo, Maria Cristina; Sanfilippo, Eleonora
    Abstract: The literature on Keynes’s activity as an investor has substantially grown in the last decade (e.g. Chambers and Dimson 2013; Accominotti and Chambers 2016; Chambers and Kabiri 2016; Cristiano, Marcuzzo and Sanfilippo 2018; Marcuzzo and Rosselli 2018; Marcuzzo and Sanfilippo 2016; [2020]2022). The contribution of the present paper is to investigate a specific feature of Keynes’s investment activity on his own account: his preference for American rather than British Investment Trusts. While this feature has also been observed in his investments on behalf of King’s College (Chambers and Kabiri 2016), we focus here on his personal portfolio, and we also provide a set of possible explanations for his preference. We maintain that some reasons have to do with the different structure and characteristics of the Investment Trusts in the two countries. Others relate more closely to the kind of investment policy typically adopted by the American Investment Trusts, which was much more in line with Keynes’s own approach to investment - especially as far as the stocks selection is concerned. Finally, we also attribute a role to his epistemological approach, i.e. the view that, although a full and perfect knowledge is not reachable by individuals due to the radical uncertainty characterizing the environment (“we simply don’t know”, Keynes 1937) and to the limitations of the human mind, reliable information remains, however, a guide for rational decision-making, also in financial markets. Following this approach, as we will show, Keynes preferred to delegate his investment choices in the US stock market to those professionals - the managers of the Investment Trusts - who possessed, in his opinion, the wider set of reliable information on that market, while keeping for himself the investment choices in the UK stock market.
    Date: 2024–02–02
  14. By: Yi Yiang; Richard S. J. Tol
    Abstract: In the era of sustainability, firms grapple with the decision of how much to invest in green innovation and how it influences their economic trajectory. This study employs the Crepon, Duguet, and Mairesse (CDM) framework to examine the conversion of R&D funds into patents and their impact on productivity, effectively addressing endogeneity by utilizing predicted dependent variables at each stage to exclude unobservable factors. Extending the classical CDM model, this study contrasts green and non-green innovations' economic effects. The results show non-green patents predominantly drive productivity gains, while green patents have a limited impact in non-heavy polluting firms. However, in high-pollution and manufacturing sectors, both innovation types equally enhance productivity. Using unconditional quantile regression, I found green innovation's productivity impact follows an inverse U-shape, unlike the U-shaped pattern of non-green innovation. Significantly, in the 50th to 80th productivity percentiles of manufacturing and high-pollution firms, green innovation not only contributes to environmental sustainability but also outperforms non-green innovation economically.
    Date: 2024–01
  15. By: Seven Ağır (Department of Economics, Middle East Technical University, Ankara, Turkey)
    Abstract: The small and medium-sized enterprises might play an essential role in the economy of a developing country. Yet, in developing countries, relatively fewer firms have been able to transition from micro enterprises focusing on survival to small and medium enterprises with higher capacity for innovation and job creation. This problem of the ‘missing middle’ has been identified as one of the barriers to increasing economic prosperity and therefore the ‘reasons’ underlying it have been examined in studies on various parts of the developing world. This study examines the ‘missing middle’ problem from a historical-institutional perspective by focusing on the underutilization of a novel form of business organization, i.e., PLLC in Turkey. Based upon a novel dataset of firm creation and desk research on legal changes in Turkey during 1957-1994, the study demonstrates the ‘missing’ PLLCs and discuss the potential factors underlying legal stagnation.
    Date: 2023–11
  16. By: DesRoches, C. Tyler
    Abstract: Review of “A History of Ecological Economic Thought” by Marco P. Vianna Franco and Antoine Missemer.
    Date: 2024–01–26
  17. By: Kapetaniou, Chrystalla; Pissarides, Christoforos Antoniou
    Abstract: In a model with robots, and automatable and non-automatable human tasks, we examine robot-labour substitutions and show how they are influenced by a country's 'innovation system'. Substitution depends on demand and production elasticities, and other factors influenced by the innovation system. Making use of World Economic Forum data we estimate the relationship for thirteen countries and find that countries with poor innovation capabilities substitute robots for workers much more than countries with richer innovation capabilities, which generally complement them. In transport equipment and non-manufacturing robots and workers are stronger substitutes than in other manufacturing.
    Keywords: robots-employment substitution; automatable tasks; complementary task creation; innovation environment; industrial allocations
    JEL: J23 L60 O33 O52
    Date: 2023–03–15

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