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on Heterodox Microeconomics |
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Issue of 2025–05–05
fourteen papers chosen by Carlo D’Ippoliti, Università degli Studi di Roma “La Sapienza” |
| By: | Moran, José; P. Pijpers, Frank; Weitzel, Utz; Panja, Debabrata; Bouchaud, Jean-Philippe |
| Abstract: | Socio-technical systems, where technological and human elements interact in a goal-oriented manner, provide important, functional support to our societies. We draw specific attention to the concept of timeliness that has been ubiquitously and integrally adopted as a quality standard in the modus operandi of socio-technical systems, but remains an underappreciated aspect. We point out that a variety of incentives, often reinforced by competitive pressures, prompt system operators to myopically optimize for cost- and time-efficiencies, running the risk of inadvertently pushing the systems towards the proverbial 'edge of a cliff'. Invoking a stylized model for operational delays, we argue that this cliff edge is a true critical point — identified as temporal criticality — implying that system efficiency and robustness to perturbation are in tension with each other. Specifically for firm-to-firm production networks, we suggest that the proximity to temporal criticality is a possible route for solving the fundamental "excess volatility puzzle" in economics. Further, in generality for optimizing socio-technical systems, we propose that system operators incorporate a measure of resilience in their welfare functions. |
| Date: | 2023–08 |
| URL: | https://d.repec.org/n?u=RePEc:amz:wpaper:2023-13 |
| By: | Giovanni Dosi; Marcelo C. Pereira; Gabriel Petrini; Andrea Roventini; Maria Enrica Virgillito |
| Abstract: | Agent-Based Models (ABMs) provide powerful tools for economic analysis, capturing microto- macro interactions and emergent properties. However, integration with empirical data has been a persistent challenge. To address it, we propose a protocol for integration between empirical data and ABM, building a new multidimensional similarity index that aggregates different similarity measures into a composite score, specifically designed to quantify alignment between simulated and real-world data. This metric enables a complete model ranking procedure, facilitating a streamlined model selection. The protocol is designed to be model-agnostic and flexible, allowing its application to a wide range of models beyond ABMs, including aggregate dynamical systems and any type of computational model. As an example, we apply our methodology to different configurations and model versions of the Schumpeter meeting Keynes (K+S) ABM family (Dosi, Fagiolo, and Roventini, 2010) using US data (from 1948Q1 to 2019Q1). Next, we propose a policy-informed application, attributing different weights to variables associated with policy-making decisions and technological change. The exercise is done in order to showcase the capacity of the procedure to target specific policy variables of interest, allowing for the design of empirically informed scenario analyses and projections on real-world dynamics. |
| Date: | 2025–04–23 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/17 |
| By: | Xabier Itçaina (CED - Centre Émile Durkheim - IEP Bordeaux - Sciences Po Bordeaux - Institut d'études politiques de Bordeaux - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | This article is based on a presentation delivered at the IV Congress of the Economy of Francis and Clare in Latin America and the Caribbean, held at the Ibero-American University, Mexico City, on October 24–25, 2024. Its purpose is to answer the question: What can Europe learn from Mexico's Social and Solidarity Economy (SSE)? To this end, three ideas are presented. First, the (Western) European SSE has much to learn from the Mexican one in terms of territorial rootedness and the self-organizing ca-pacity of civil society. Second, it must also reflect on the difficulties faced in Mexico, particularly regarding economic challenges, governance issues in SSE experiences, and forms of struggle in complex and conflictive territorial contexts. Finally, both the European and Mexican SSE have much to learn from each other. This circulation of models is already underway and does not necessarily occur from center to center but rather from periphery to periphery. |
| Abstract: | Este artículo se basa en una ponencia presentada en el IV Congreso de la Economía de Francisco y Clara en América Latina y el Caribe, celebrado en la Universidad Iberoamericana Ciudad de México los días 24 y 25 de octubre de 2024. Su propósito es responder a la pregunta: ¿Qué puede aprender Europa de la economía social y solidaria (ESS) de México? Para ello, se presentan tres ideas. Primero, la ESS europea (occidental) tiene mucho que aprender de la mexicana en cuanto al arraigo territorial y la capacidad autoorganizativa de la sociedad civil. Segundo, la ESS europea debe aprender de las dificultades que enfrenta la mexicana, particularmente en relación con los retos económicos, los problemas de gobernanza en sus experiencias y las formas de lucha en entornos territoriales complejos y conflictivos. Finalmente, tanto la ESS europea como la mexicana tienen mucho que aprender mutuamente. Esta circulación de modelos ya está en marcha y no ocurre necesariamente de centro a centro, sino más bien de periferia a periferia. |
| Keywords: | social and Solidarity-Based Economy, cooperatives, Europe, Mexico, lear-ning, territorial Ecosystems, economía social y solidaria, cooperativas, Europa, México, aprendizaje, ecosistemas territoriales |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:halshs-04987713 |
| By: | Marius Kleinheyer; Gunther Schnabl |
| Abstract: | Argentina has been characterised for a long time by inflation, recession, poverty and failed reforms. We analyse the reforms of Javier Milei with the help of the Austrian School of Economics, German ordoliberalism and the theory of financial repression. It is shown that Milei’s reforms have achieved with expenditure cuts and decisive deregulation an impressing consolidation of the public budget, a decline of inflation as well as – with a lag – growth and a falling poverty rate. His reforms may become a blueprint for other countries such as Germany. |
| Keywords: | Argentina, Milei, inflation, reforms, deregulation, growth |
| JEL: | B53 E58 P11 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11752 |
| By: | Léo Revelli |
| Abstract: | Growing financial needs for a sustainable transition have led to the development of green finance and citizen-led monetary innovations. These initiatives recognized the necessity of developing new forms of money regarding the environmental crisis, referred to as environmental complementary currency (ECCs). ECCs aim to generate environmental benefits by rewarding pro-environmental behaviors, funding green projects, encouraging short supply chains and circular economy, and increasing environmental awareness and knowledge within communities.Despite case studies highlighting ECCs' potential benefits, no comprehensive synthesis of their environmental impact exists. This paper addresses this gap by theoretically identifying ECCs’ environmental impact and inferring their actual magnitude through a systematic review. Searches conducted on Google Scholar, Scopus, and field-specific databases yielded a dataset of 35 empirical studies on ECCs’ environmental impacts, focusing on grassroots and emerging forms of complementary currencies, including digital and crypto-currencies. Schemes not designed to reduce the footprint of human activities were excluded. Findings suggest that ECCs can reduce their users’ environmental impacts by raising awareness and knowledge and promoting a shift towards environmentally sustainable consumption. Moreover, we cannot conclude that the localization effects associated with ECCs generate benefits. This paper highlights the limitations of existing research and suggests directions for future studies. |
| Keywords: | Complementary currency; Ecological economics; Environmental impacts; Systematic review; Behavioral economics |
| JEL: | E51 D91 Q01 Q56 |
| Date: | 2025–04–25 |
| URL: | https://d.repec.org/n?u=RePEc:sol:wpaper:2013/390180 |
| By: | Pierre Bousseyroux; Gilles Z\'erah; Michael Benzaquen |
| Abstract: | Stabilizing cooperation among self-interested individuals presents a fundamental challenge in evolutionary theory and social science. While classical models predict the dominance of defection in social dilemmas, empirical and theoretical studies have identified various mechanisms that promote cooperation, including kin selection, reciprocity, and spatial structure. In this work, we investigate the role of localized imitation in the evolutionary dynamics of cooperation within an optional Public Goods Game (PGG). We introduce a model where individuals belong to distinct groups and adapt their strategies based solely on comparisons within their own group. We identify different dynamical regimes, including stable fixed points, limit cycles, and Rock-Scissors-Paper-type oscillations. Our analysis, grounded in a replicator-type framework, reveals that such group-level imitation can stabilize cooperative behavior, provided that groups are not initially polarized around a single strategy. In other words, restricting imitation to group-level interactions mitigates the destabilizing effects of global competition, providing a potential explanation for the resilience of cooperation in structured populations. |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2504.05086 |
| By: | Hamed Farahani; R. A. Serota |
| Abstract: | We study decades-long historic distributions of accumulated S\&P500 returns, from daily returns to those over several weeks. The time series of the returns emphasize major upheavals in the markets -- Black Monday, Tech Bubble, Financial Crisis and Covid Pandemic -- which are reflected in the tail ends of the distributions. De-trending the overall gain, we concentrate on comparing distributions of gains and losses. Specifically, we compare the tails of the distributions, which are believed to exhibit power-law behavior and possibly contain outliers. Towards this end we find confidence intervals of the linear fits of the tails of the complementary cumulative distribution functions on a log-log scale, as well as conduct a statistical U-test in order to detect outliers. We also study probability density functions of the full distributions of the returns with the emphasis on their asymmetry. The key empirical observations are that the mean of de-trended distributions increases near-linearly with the number of days of accumulation while the overall skew is negative -- consistent with the heavier tails of losses -- and depends little on the number of days of accumulation. At the same time the variance of the distributions exhibits near-perfect linear dependence on the number of days of accumulation, that is it remains constant if scaled to the latter. Finally, we discuss the theoretical framework for understanding accumulated returns. Our main conclusion is that the current state of theory, which predicts symmetric or near-symmetric distributions of returns cannot explain the aggregate of empirical results. |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2503.24241 |
| By: | Likavčan, Lukáš; Frank, Adam |
| Abstract: | This paper aims to explore an astrobiological genealogy of the concept of the Planetary vividly discussed in contemporary environmental humanities and social sciences, and to offer a framework for an articulation of political-economic models based on this concept. Following Bentley Allan, we propose to treat the Planetary as an example of scientific cosmology, thus emphasizing how astrobiology supports a much broader philo- sophical worldview that shines a new light on persistent problems related to organizing human inhabitation of the Earth. Starting with the analysis and speculative elaboration on Allan’s theory of cosmological shifts in international orders during Western modernity, we associate the Anthropocene discourse as an inaugurating moment in the consolida- tion of the Planetary’s scientific cosmology, grounded in the astrobiology’s metabolic per- spective on complex adaptive systems. The narrative of the paper offers a genealogy of this perspective, including the most recent research about information metabolisms and biosphere-technosphere coupling in astrobiology, which paves the way for the explanation of the economy itself as a metabolic entity. After the review of adjacent philosophical po- sitions associated with ecological economics and the theory of complex adaptive systems, the paper concludes with remarks on the Planetary as a cornerstone of an international order that yields economic imperatives governed by a generic view of the Earth as a mem- ber of a potentially large and diverse category of habitable planets. |
| Date: | 2025–04–17 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:4963w_v1 |
| By: | Hess, Simon |
| Abstract: | This paper studies the effects of introducing a Central Bank Digital Currency (CBDC) on economic output, bank intermediation and financial stability in a closed economy using an Agent-based Stock Flow Consistent (AB-SFC) Model. Thereby a digital bank run is simulated across various economic environments with different monetary policy and bank bankruptcy regimes. According to the model, non-remunerated CBDC issued in a positive-interest environment with a corridor system may increase GDP through increased seigniorage income and government spending. Also bank funding becomes more expensive since bank deposit stickiness is prevented. Non-remunerated CBDC issued in a zero-interest environment has no impact since there is no distributional effect of the interest payments. In a floor-system where the interest rate on CBDC matches the policy rate, CBDC also counteracts deposit stickiness and redistributes bank profits from shareholders to depositors. Thereby CBDC improves the transmission of the policy rate to households and firms. The bank bankruptcy regime also affects the outcome. While CBDC makes no difference in a bailout regime it does in a bail-in regime where it decreases inequality and distributes bank rescue costs evenly among households and firms, potentially enhancing financial stability. Introducing CBDC within a deposit insurance system postpones bank rescue payments, which creates an additional dynamic in GDP. |
| Keywords: | central bank digital currency, agent-based model, bank run, bailout, bail-in, financial stability |
| JEL: | E42 E58 G21 G23 G28 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:roswps:171 |
| By: | Carro, Adrian; Hinterschweiger, Marc; Uluc, Arzu; Borsos, András; Kaszowska-Mojsa, Jagoda (Institute for New Economic Thinking, University of Oxford); Glielmo, Aldo (Bank of Italy) |
| Abstract: | Over the past decade, agent-based models (ABMs) have been increasingly employed as analytical tools within economic policy institutions. This chapter documents this trend by surveying the ABM-relevant research and policy outputs of central banks and other related economic policy institutions. We classify these studies and reports into three main categories: (i) applied research connected to the mandates of central banks, (ii) technical and methodological research supporting the advancement of ABMs; and (iii) examples of the integration of ABMs into policy work. Our findings indicate that ABMs have emerged as effective complementary tools for central banks in carrying out their responsibilities, especially after the extension of their mandates following the global financial crisis of 2007-2009. While acknowledging that room for improvement remains, we argue that integrating ABMs into the analytical frameworks of central banks can support more effective policy responses to both existing and emerging economic challenges, including financial innovation and climate change. |
| Keywords: | Agent-based models, household analysis, financial institutions, central bank policies, monetary policy, prudential policies |
| JEL: | C63 E37 E58 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:amz:wpaper:2025-05 |
| By: | Takeshi Kato; Junichi Miyakoshi; Misa Owa; Ryuji Mine |
| Abstract: | Reducing wealth inequality is a global challenge, and the problems of capitalism stem from the enclosure of the commons and the breakdown of the community. According to previous studies by Polanyi, Karatani, and Graeber, economic modes can be divided into capitalist market economy (enclosure and exchange), power economy (de-enclosure and redistribution), gift economy (obligation to return and reciprocity), and concession economy (de-obligation to return). The concession economy reflects Graeber's baseline communism (from each according to their abilities, to each according to their needs) and Deguchi's We-turn philosophy (the "I" as an individual has a "fundamental incapability" and the subject of physical action, responsibility, and freedom is "We" as a multi-agent system, including the "I"). In this study, we constructed novel network models for these four modes and compared their properties (cluster coefficient, graph density, reciprocity, assortativity, centrality, and Gini coefficient). From the calculation results, it became clear that the market economy leads to inequality; the power economy mitigates inequality but cannot eliminate it; the gift and concession economies lead to a healthy and equal economy; and the concession economy, free from the ties of obligation to return, is possible without guaranteeing reciprocity. We intend to promote the transformation from a capitalist economy to a concession economy through activities that disseminate baseline communism and the We-turn philosophy that promotes concession, that is, developing a cooperative platform to support concession through information technology and empirical research through fieldwork. |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2504.06557 |
| By: | Pangallo, Marco; Lafond, François; Farmer, J. Doyne; Wiese, Samuel; Muellbauer, John; Moran, José; Dyer, Joel; Kaszowska-Mojsa, Jagoda (Institute for New Economic Thinking, University of Oxford); Calinescu, Anisoara (Institute for New Economic Thinking, University of Oxford) |
| Abstract: | In the last few years, economic agent-based models have made the transition from qualitative models calibrated to match stylised facts to quantitative models for time series forecasting, and in some cases, their predictions have performed as well or better than those of standard models (see, e.g. Poledna et al. (2023a); Hommes et al. (2022); Pichler et al. (2022)). Here, we build on the model of Poledna et al., adding several new features such as housing markets, realistic synthetic populations of individuals with income, wealth and consumption heterogeneity, enhanced behavioural rules and market mechanisms, and an enhanced credit market. We calibrate our model for all 38 OECD member countries using state-of-the-art approximate Bayesian inference methods and test it by making out-of-sample forecasts. It outperforms both the Poledna and AR(1) time series models by a highly statistically significant margin. Our model is built within a platform we have developed, making it easy to build, run, and evaluate alternative models, which we hope will encourage future work in this area. |
| Keywords: | Agent-based models, Bayesian estimation, Economic forecasting |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:amz:wpaper:2024-06 |
| By: | Mackenson Saint-Cyr., Ph.D. (ISTEAH - Institut des sciences, des technologies et des études avancées d'Haïti, UPSEJ - Université Publique du Sud'est à Jacmel, FSESP-UNDH - Universite Notre-Dame d'Haiti - Faculte des Sciences Economiques, Sociales et Politiques) |
| Abstract: | Mackenson SAINT-CYR., Ph.D. Chercheur et professeur aux universités 22 mars 2025 RésuméCet article est inspiré des résultats de la thèse de doctorat de Saint-Cyr. Il vise à comprendre et expliquer, par une réflexion axée sur l'épistémologie constructiviste, comment les coopératives font preuve de résilience par rapport aux crises en trouvant les moyens d'être excédentaires. Les différents concepts sont définis pour renforcer la problématique de recherche de cet article en s'appuyant sur la théorie de la performance coopérative. La méthodologie adoptée fait ressortir une épistémologie constructiviste avec des outils de collecte de données spécifiques répondant à la question de recherche formulée à cet effet. Au terme de la réflexion, l'article conclut que les coopératives d'épargne et de crédit dans le département du Sud-Est spécifiquement dans l'arrondissement de Jacmel, font preuve de résilience. |
| Keywords: | coopératives d'épargne et de crédit résilience croissance financière performance coopérative, coopératives d'épargne et de crédit, résilience, croissance financière, performance coopérative |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05002108 |
| By: | GIRARDI, Daniele; GRAU, Nicolas; VENEZIANI, Roberto; YOSHIHARA, Naoki |
| Abstract: | This paper provides a novel axiomatic analysis of exploitation as the unequal exchange of labour, derives an empirical exploitation index at the individual level, and estimates its distribution in the US in 1975-2022. We show that, among possible definitions of exploitation, only one satisfies a small set of formally weak and normatively salient axioms. From this definition, we derive an individual-level exploitation intensity index which provides a new measure of well-being and inequality, complementary to existing ones and able to jointly take into account the distributions of income and work time. In US data, exploitation intensity provides additional information compared with standard income inequality measures and predicts important well-being and political outcomes. Inequality in exploitation increased more than income inequality since 1975. |
| JEL: | D63 D5 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:hit:hituec:765 |