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on Heterodox Microeconomics |
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Issue of 2025–03–03
seventeen papers chosen by Carlo D’Ippoliti, Università degli Studi di Roma “La Sapienza” |
| By: | Smith, Tone |
| Abstract: | As the interest in heterodox economic theories increase, so does the demand for overview articles presenting these theories. This article is an attempt to provide a short overview of the most important elements of the field of ecological economics. |
| Keywords: | Ecological economics, social-ecological economics, limits to growth, degrowth, plural values. |
| JEL: | B59 Q57 |
| Date: | 2025–02–03 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:123544 |
| By: | Nikolaos Chatzarakis (Department of Economics, New School For Social Research, USA) |
| Abstract: | The classical system of production assumes that (i) competition between labourers and capitalists (and among labourers) results to a uniform wage, (ii) competition among capitalists within each industry to a uniform price, and (iii) competition among capitalists in different sectors to a uniform rate of profit. These are the laws of competition Marx attempted to incorporate into his 'transformation' process. Okishio and Shaikh showed that such a `transformation algorithm' indeed exists. However, the inter-sectoral competition wass emphasised, while the intra-sectoral competition almost entirely ignored. In this work, we attempt to incorporate this phase of competition and extend the Okishio-Shaikh algorithm. |
| Keywords: | Labour theory of value, laws of competition, transformation problem, regulating prices |
| JEL: | B14 B24 B51 D46 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:new:wpaper:2503 |
| By: | Fisher, Carolyn; Ranaldi, Marco |
| Abstract: | This paper explores the concept, measurement, principal stylized facts, and theoretical aspects of compositional inequality. Compositional inequality refers to how the shares of capital and labor income vary along the income distribution. This analysis is valuable for several reasons. From a macroeconomic perspective, it elucidates the link between functional and personal distributions of income, which is crucial for addressing the drivers of income inequality in a context rising capital share. From a comparative economic perspective, it locates economic systems on the continuum between two extremes: classical capitalism, where the rich earn predominantly from capital and the poor from labor, and new capitalism, where the composition of capital and labor is uniform across the distribution. We refer to the entire range of systems along this continuum as the distributional varieties of capitalism. Recent empirical studies indicate that, in most countries, we are far from classical capitalism, though with notable exceptions, such as Latin American countries. This underscores the need to evaluate the benefits of compositional equality. The paper concludes that compositional equality is desirable for at least two reasons: it promotes fairness and supports an inclusive, profit-driven regime of accumulation and growth. (Stone Center on Socio-Economic Inequality Working Paper) |
| Date: | 2025–02–04 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:75ghp_v2 |
| By: | Dylan C. Terry-Doyle; Adam B. Barrett |
| Abstract: | The ever-approaching limits of the Earth's biosphere and the potentially catastrophic consequences caused by climate change have begun to call into question the endless growth of the economy. There is increasing interest in the prospects of zero economic growth from the degrowth and post-growth literature. In particular, the question arises as to whether a zero-growth trajectory in a capitalist system with interest-bearing debt can be economically stable. There have been several answers to this question using macroeconomic models; some find a zero-growth trajectory is stable, while other models show an economic breakdown. However, the capitalist system in a period of growth is not guaranteed to be stable. Hence, a more appropriate methodology is to compare the relative stability between a growth and zero-growth scenario on the same model. Such a question has not yet been answered at any disaggregated level. It's important to investigate the consequences of zero-growth on market share instability and concentration, bankruptcy rates, income distribution, and credit network risk. To answer such questions, we develop a macroeconomic agent-based model incorporating Minskyan financial dynamics. The growth and zero-growth scenarios are accomplished by changing an average productivity growth parameter for the firms in the model. The model results showed that real GDP growth rates were more stable in the zero-growth scenario, there were fewer economic crises, lower unemployment rates, a higher wage share of output for workers, and capital firm and bank market shares were relatively more stable. Some of the consequences of zero-growth were a higher rate of inflation than in the growth scenario, increased market concentration for both firms and banks, and a higher level of financial risk in the credit network. |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2501.19168 |
| By: | Simon Fløj Thomsen; Hamid Raza; Mikael Randrup Byrialsen |
| Abstract: | This paper aims to develop an ecological macroeconomic model for the Danish economy that can link the economic and financial system with some key aspects of the climate. To do so, we combine Stock-flow-Consistent approach (SFC) with Input-Output tables (IO) to build a hybrid model, which we call Ecological Stock-Flow-Consistent Input-Output model (E-SFC-IO). Most parameters of the model are estimated using time series data from 1995 to 2019, after which, we carry out simulations. We find that the model (with some minor adjustments) can replicate the dynamics of our key variables pertaining to the economy, financial system, and climate. To further validate the model, we analyse the response of the economy to various shocks, finding that it can capture the stylised facts. The model offers a foundation for providing a reasonable assessment of the climate policies to the relevant stakeholders. |
| Keywords: | Empirical Stock Flow consistent models, Input-Output modelling, Ecological macroeconomics, Denmark |
| JEL: | E12 E17 F41 L16 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:imk:fmmpap:114-2025 |
| By: | Basile Clerc |
| Abstract: | This article seeks to highlight a previously overlooked theoretical continuity in François Perroux's trajectory, linking his "corporatist period" to his post-war writings. We demonstrate that a key aspect of François Perroux's critique of neoclassical economics, which persisted through his efforts to revise general equilibrium theory in the 1970s, originates from his corporatist economic model developed in the 1930s. This core idea can be summarized as follows: the concentrated nature of capitalist structures makes the economic equilibrium indeterminate, necessitating and justifying the intervention of the state to regulate both prices and wages. We argue that the convergence of Perroux's critique of neoclassical economics and his corporatist theorization reaches its peak in a text published during the Liberation of France, a time of profound intellectual transformation for the author. The theoretical elements developed on this occasion permeate the whole of his later works, which must therefore be reinterpreted in the light of his early corporatist writings. Finally, by exhuming a significant yet entirely overlooked theory, this article contributes to the development of a historical perspective on microeconomic theories of price control. |
| Keywords: | François Perroux; price control; neoclassical economics; corporatism |
| JEL: | B21 B31 E64 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:drm:wpaper:2025-12 |
| By: | Hipólito, Inês |
| Abstract: | This paper applies complex systems theory to examine generative artificial intelligence (AI) as a contemporary wicked problem. Generative AI technologies, which autonomously create content like images and text, intersect with societal domains such as ethics, economics, and governance, exhibiting complex interdependencies and emergent behaviors. Using methodologies like network analysis and agent-based modeling, the paper maps these interactions and explores potential interventions. A mathematical model is developed to simulate the dynamics between key components of the AI-society system, including AI development, economic concentration, labor markets, regulatory frameworks, public trust, ethical implementation, global competition, and distributed AI ecosystems. The model demonstrates non-linear dynamics, feedback loops, and sensitivity to initial conditions characteristic of complex systems. By simulating various interventions, the study provides insights into strategies for steering AI development towards more positive societal outcomes. These include strengthening regulatory frameworks, enhancing ethical implementation, and promoting distributed AI ecosystems. The paper advocates for using this complex systems framework to inform inclusive policy and regulatory strategies that balance innovation with societal well-being. It concludes that embracing complexity enables stakeholders to better navigate the evolving challenges of generative AI, fostering more sustainable and equitable technological advancements. |
| Date: | 2024–08–29 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:aq4tw_v1 |
| By: | Lécureur, Clairelou |
| Abstract: | This first issue of the Enseignements du Lab collection provides a transversal reading of the results of four collective projects linked to the ecological transition in working-class neighbourhoods. It focuses on the sociological dimension of the climate crisis and, more specifically, on environmental inequalities. The link between environmental issues and inequalities is not new, but it is increasingly being studied, mainly through the prism of working-class neighbourhoods. Indeed, residents of low-income urban areas are more vulnerable to the consequences of climate change. And this, even though they contribute to it the least, through their consumption. After presenting the specific context and potential of working-class neighbourhoods to contribute to the social and ecological transition, this publication answers the following question: what actions are possible in working-class neighbourhoods to address environmental inequalities and move towards greater environmental justice? |
| Date: | 2024–10–11 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:d4pwh_v1 |
| By: | Vitale, Tommaso Prof (Sciences Po) |
| Abstract: | This chapter commences with the presentation of three questions. Firstly, what are the strengths of political and social science research work on associationism? Secondly, which areas have been treated with a greater degree of ideological bias and would therefore benefit from a more critical realist approach (Pratschke, 2003)? Thirdly, what insights have been gained? In responding to these queries, the chapter considers the ways in which research has frequently examined associationism with a view to elucidating broader dynamics, including those pertaining to politics, professionalisation, organisation, community, elites, cooperation, and categories of stratification. As we examine the ways in which cities engage with associations, we observe a multiplicity of modes of governance, a diversity of instruments of public action, and a structure of associational opportunities. This allows us to investigate the mechanisms and processes involved, adopting a historical and comparative approach that aligns with Weberian principles. |
| Date: | 2024–10–30 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:udbew_v1 |
| By: | Reddy, Niall |
| Abstract: | A large literature in heterodox political economy addresses an apparent puzzle in which investment has declined while profits have held up during the financialization era. The dominant answer to this puzzle centers on the rise of shareholder value orientation and the “downsizing and distributing” (DD) imperative it imposes on firms. Yet the detailed empirical literature on the topic - focussed on partial effects - pays precious little attention to actual observed patterns of growth, investment and distribution at a firm level. Digging deep into firm level data and correcting several conceptual and measurement errors, this paper challenges several key stylized facts of the financialization account, revealing a different set of patterns which are very difficult to square with stronger versions of DD theory. It shows that the profit-investment puzzle is not a paradox of the financialization era, but only of the post-2000 period. Similarly, the ramping up of payout rates only happens in a broad way after the turn of the millennium. While financialization theories cannot account for the 2000s watershed I argued that a trifecta of other structural shifts can. Ultimately this paper questions the widespread practice of giving analytical priority to financialization in heterodox political economy. |
| Date: | 2024–04–01 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:2zy5h_v2 |
| By: | Bernard Gazier (Centre d'Economie de la Sorbonne); Frédéric Bruggeman (Ex-expert auprès des comités d'entreprise) |
| Abstract: | This article explores the idea that a possible commitment to an ecological bifurcation requires the coupling of political democracy and social democracy. This recourse to social dialogue is doubly paradoxical. On the one hand, it is very unevenly developed, and on the whole, has been weakened since the 1970s. On the other hand, unions mainly voice the concerns of workers faced with the threat of job losses and impoverishment arising from both the manifestations of the ecological crisis and the measures designed to respond to it. However, the mobilisation of social democracy is essential if all stakeholders, and workers in particular, are to be involved. We set out to show that this requires a broadening and renewal of social dialogue. The argument proceeds in four stages. First, we look back at current difficulties, to show that the aim is in fact to establish a new social contract to replace the one defined and implemented during the Fordist era. We then examine how ecological issues and players are currently being introduced into the existing social dialogue in France and Europe, and show that this process is not up to the challenge. Thirdly, a theoretical perspective is introduced which broadend the discussion by focusing on the "real freedom" of workers and the old and new forms of scarcity facing our societies. Finally, we return to the subject of social dialogue, examining the major transformations that are needed if the emancipation of workers and the ecological transition are to be mutually supportive |
| Keywords: | Social dialogue; ecological transition; capabilities; Transitional Labour Markets |
| JEL: | J22 J24 J50 J62 J80 |
| Date: | 2024–02 |
| URL: | https://d.repec.org/n?u=RePEc:mse:cesdoc:24002rr |
| By: | Vasarhelyi, Orsolya; Brooke, Siân |
| Abstract: | Studying gender presents unique challenges to data science. Recent work in the spirit of computational social science returns to critical approach to operationalisation providing a fresh perspective on this important topic. In this chapter we highlight works that examines gender computationally, describing how they employ levels of feminist theory to challenge gender inequality at the micro, meso, and macro level. We argue that paying critical attention to how we infer and analyze gender is fruitfully in understanding society and the contributions of research. We also present various sources and methods to infer gender and provide examples of the application of such methods. We conclude by outlining the way forward for computational methods in how gender and intersectional inequality is studied.This is a draft. The final version will be available in Handbook of Computational Social Science edited by Taha Yasseri, forthcoming 2023, Edward Elgar Publishing Ltd. The material cannot be used for any other purpose without further permission of the publisher and is for private use only. Please cite as: Vasarhelyi, O., & Brooke, S.(2023). Computing Gender. In: T. Yasseri (Ed.), Handbook of Computational Social Science. Edward Elgar Publishing Ltd. |
| Date: | 2025–01–31 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:admcs_v2 |
| By: | Vallstrom, Daniel |
| Abstract: | https://doi.org/10.48550/arXiv.2404.03685 With an evolutionary approach, the basis of morality can be explained as adaptations to problems of cooperation. With ‘evolution’ taken in a broad sense, AIs that satisfy the conditions for evolution to apply will be subject to the same cooperative evolutionary pressure as biological entities. Here the adaptiveness of increased cooperation as material safety and wealth increase is discussed — for humans, for other societies, and for AIs. Diminishing beneficial returns from increased access to material resources also suggests the possibility that, on the whole, there will be no incentive to for instance colonize entire galaxies, thus providing a possible explanation of the Fermi paradox, wondering where everybody is. It is further argued that old societies could engender, give way to, super-AIs, since it is likely that super-AIs are feasible, and fitter. Closing is an aside on effective ways for morals and goals to affect life and society, emphasizing environments, cultures, and laws, and exemplified by how to eat. `Diminishing returns’ is defined, as less than roots, the inverse of infeasibility. It is also noted that there can be no exponential colonization or reproduction, for mathematical reasons, as each entity takes up a certain amount of space. Appended are an algorithm for colonizing for example a galaxy quickly, models of the evolution of cooperation and fairness under diminishing returns, and software for simulating signaling development. |
| Date: | 2025–02–11 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:bq438_v3 |
| By: | Chee, Liberty (Ca' Foscari University of Venice) |
| Abstract: | After nearly half a century, domestic workers were again tabled on the agenda of the International Labour Conference in 2008. Three short years later, Conference delegates voted to establish the International Labour Organization’s Convention on Domestic Work (C189). This paper builds on the insight that the campaign to push for C189 was taken up by a feminist “velvet triangle”. These networks are usually comprised of women in social movements, femocrats and academics. The informality of these alliances is due, in part, to the gendered marginality of an issue area, allowing for improvisation and agile coalitions. The paper traces the origins of this triangle to bottom-up calls to develop measurement methodologies to make women’s labour “visible” in the UN Conferences on Women, and later in discussions about the informal economy. It then examines the relations among femocrats in the ILO, academics, and the global trade unions in one important element of the campaign – mobilising statistics on domestic workers worldwide. The paper demonstrates how the production and mobilisation of statistical estimates were crucial in making the sector more tractable. It attends to the under-explored effects of the “power of cognitive resources” in the literature. Finally, the article shows that the explicitly political project of the women’s movements yielded not only a normative labour instrument, but advances in different fields of study. This case shows that the production of scientific knowledge, while still an overwhelmingly elite endeavour, need not always cater to elite demands. |
| Date: | 2024–10–24 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:9fbu7_v1 |
| By: | Galanis, Giorgos (Queen Mary University of London, Centre for Economic Theory and its Applications, University of Warwick); Ricchiuti, Giorgio (Università degli Studi di Firenze, Complexity Lab in Economics (CLE), Università Cattolica del Sacro Cuore, Milano); Tippet, Ben (King’s College London, University of London) |
| Abstract: | Countries respond differently to climate change, and while this resulting behavioral heterogeneity is empirically observed, its impact on the evolution of global climate action has not been analyzed. This leads to two related questions that we address: (i) what is the role of the variation of preferences in the global political economy of climate action ; and (ii) what are the necessary conditions for sustained high levels of global action? We develop an evolutionary political economy integrated assessment model where heterogeneous countries, in each period, choose whether to take action to reduce emissions or not. Countries’ choices are influenced by their current level of emissions, total participation in climate action, and other idiosyncratic factors capturing their heterogeneity, which depends on income inequality across countries, vulnerability to climate damages, and other political economy factors. Our model shows the possibility of various outcomes, where high levels of sustained global action is only one possibility. The key result is that sustained high levels of global action are achieved only if there is a low degree of heterogeneity in countries’ preferences for action and a strong peer pressure effect. |
| Keywords: | Climate action ; Heterogeneous agents ; Evolutionary dynamics ; Integrated assessment JEL Codes: C62 ; E71 ; F5 ; Q54 ; Q58 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:wrk:wcreta:91 |
| By: | Alexander Guschanski; Özlem Onaran |
| Abstract: | We analyse UK markups and profit margins for the pandemic period and its aftermath using unconsolidated balance sheets of non-financial corporations for both listed and unlisted firms. The markup increases by 14.7% between 2014 and 2022, exceeding any previously documented growth rate for UK markups, despite major economic, ecological and geo-political crises. The rise in markups is driven by both increasing markups within UK companies and a reallocation of output towards high-markup firms. However, the within effect has dominated since 2020, driven by large firms. In this regard, the UK is different from the US, where the reallocation effect has been more prominent. Since 2014, the markup distribution of firms has become more polarised. Increasingly more firms are at risk of financial difficulties due to low profit margins while at the same time some firms are charging historically extraordinarily high markups and reap high profits. This contributes to bankruptcy risk and economic instability while exacerbating pricing power for some companies. Preventing markup increases during macroeconomic shocks should be a priority for policymakers seeking to reduce inflationary pressure and adverse effects on income inequality. |
| Keywords: | markup, profit margin, market power |
| JEL: | D4 J3 L1 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:imk:fmmpap:113-2025 |
| By: | , Adrian Alexander M.A. in Social Psychology |
| Abstract: | "Divided We Fall: A Multidisciplinary Analysis of Polarisation, Social Divides, and the Fragility of Unity in Human Societies" explores the escalating threat of polarisation and tribalism in modern human societies. By examining historical case studies, such as Nazi Germany and McCarthyism, alongside contemporary events like Brexit and the U.S. elections of 2016 and 2024, the paper identifies recurring patterns in how societal divisions are exploited for political and ideological gain. The analysis integrates insights from social psychology, highlighting cognitive biases like confirmation bias, in-group/out-group dynamics and heuristic-driven decision-making, which leave individuals vulnerable to manipulation. The paper also delves into the role of emerging technologies, such as social media and AI-driven propaganda, in amplifying divisions, creating echo chambers and eroding democratic norms. Beyond diagnosing the problem, it explores opportunities for fostering unity, drawing on historical examples of collective action, such as post-WWII reconstruction and the global response to the COVID-19 pandemic. The findings underscore the fragility of social cohesion and emphasize the urgent need for proactive leadership, media responsibility and grassroots mobilisation to counter polarisation. This multidisciplinary framework aims to provoke discussion on how humanity can navigate its growing divides and build resilience against future existential threats. The paper also explores how modern technologies—such as social media algorithms and artificial intelligence—amplify polarization, creating echo chambers and eroding trust in democratic processes. Insights from social psychology, including heuristics, cognitive biases, and tribalism, highlight the vulnerabilities that make societies susceptible to manipulation. Finally, the paper discusses pathways to unity through shared goals, historical examples of successful collaboration, and the necessity of ethical leadership and robust institutions. The findings underscore the urgent need for proactive measures to counteract polarization, emphasizing education, transparency, and collective action as essential tools for preserving democracy and fostering global unity in the face of existential threats such as climate change and technological disruption. |
| Date: | 2024–11–22 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:wzm5d_v1 |