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on Heterodox Microeconomics |
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Issue of 2025–04–28
twelve papers chosen by Carlo D’Ippoliti, Università degli Studi di Roma “La Sapienza” |
| By: | Lorenzo Corno (Université Côte d'Azur, CNRS, GREDEG, France); Giovanni Dosi (Istituto di Economia, Scuola Superiore Sant'Anna, Italy); Luigi Marengo (Dipartimento di Impresa e Management, LUISS, Italy) |
| Abstract: | This paper provides an overview of behaviors and learning of heterogeneous economic agents - whether individuals or firms—within complex evolving economies. It aims to explore the microfoundation of agency and learning, two fundamental aspects that constitutively contribute to the emergence of micro, meso, and macro stylized facts of modern capitalist economies, conceived as complex evolving systems. The investigation begins at the individual level, drawing on insights from cognitive and social sciences and identifying relevant micro-evidence concerning the cognitive, psychological, behavioral, and social dimensions of human agency in complex and uncertain environments. It then shifts to the epistemological level organization, where individual behaviors and learning are interwoven with those of other members and embedded within the genuinely collective dimensions and emergent properties of the firm—such as organizational capabilities, heuristics, and power configurations—on which the analysis will focus. This perspective interprets the firm as a sort of primitive problem-solving entity and acknowledges that organizational behaviors and learning are "more" than what can be grasped by attending solely to insulated parts. The primary objective of this work is to contribute to a positive theory of behaviors and learning in complex evolving economies, while also offering a fertile ground for theoretical and modeling developments in search of realistic building blocks. |
| Keywords: | Complex Evolving Economies, Firm Behaviour, Human Cognition and Agency, Heuristics, Microfoundations |
| JEL: | B41 B52 D01 D21 D83 D91 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:gre:wpaper:2025-14 |
| By: | Lorenzo Corno; Giovanni Dosi; Luigi Marengo |
| Abstract: | This paper provides an overview of behaviors and learning of heterogeneous economic agents -whether individuals or firms- within complex evolving economies. It aims to explore the microfoundation of agency and learning, two fundamental aspects that constitutively contribute to the emergence of micro, meso, and macro stylized facts of modern capitalist economies, conceived as complex evolving systems. The investigation begins at the individual level, drawing on insights from cognitive and social sciences and identifying relevant micro-evidence concerning the cognitive, psychological, behavioral, and social dimensions of human agency in complex and uncertain environments. It then shifts to the epistemological level organization, where individual behaviors and learning are interwoven with those of other members and embedded within the genuinely collective dimensions and emergent properties of the firm -such as organizational capabilities, heuristics, and power configurations- on which the analysis will focus. This perspective interprets the firm as a sort of primitive problem-solving entity and acknowledges that organizational behaviors and learning are "more" than what can be grasped by attending solely to insulated parts. The primary objective of this work is to contribute to a positive theory of behaviors and learning in complex evolving economies, while also offering a fertile ground for theoretical and modeling developments in search of realistic building blocks. |
| Keywords: | Complex Evolving Economies, Firm Behaviour, Human Cognition and Agency, Heuristics, Microfoundations |
| Date: | 2025–04–07 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/11 |
| By: | Giacomo Ravaioli; Francesco Lamperti; Andrea Roventini; Tiago Domingos |
| Abstract: | Climate change and economic inequality are two critical and interlinked global challenges. The feasibility of jointly reducing greenhouse gas emissions and inequality has often been questioned. Here, we aim to test whether a properly designed mix of progressive and environmental fiscal policies can effectively reduce both while improving economic dynamics. We extend the DSK integrated-assessment agent-based model to combine an income class-based analysis of inequality with an improved accounting of emissions. We calibrate the model to the European Union and employ it to explore how fiscal policies can tackle the coevolution of income inequality and carbon emission. The results show that no single policy in our portfolio can simultaneously reduce inequality and emissions. Redistributing income increases aggregate consumption and hence emissions, whereas environmental taxes risk hampering economic growth and stability. In contrast, a combination of progressive fiscal policies, green subsidies to reduce carbon intensity of production and a mild carbon tax achieves both goals, while increasing employment, growth, stability and the consumption of low-income households. A potential trade-off emerges between increasing economic growth and reducing emissions, mediated by the extent to which green innovations lead to higher productivity. In conclusion, our results show that moving towards a sustainable and inclusive economy needs the co-design of distributive, innovation and mitigation policies. |
| Keywords: | climate policies, inequality, mitigation, just transition, ecological macroeconomics, agent-based modelling |
| Date: | 2025–04–14 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/14 |
| By: | Francesco Lamperti; Giovanni Dosi; Andrea Roventini |
| Abstract: | Climate change stands as one of the most formidable challenges in the twenty-first century. Despite this, our understanding of the unfolding and interconnection of climate-related physical and transitional risks, and their implications for socioeconomic dynamics along various transition pathways, remains insufficient. This deficit of understanding echoes throughout the formulation of effective climate change policies. In this context, our chapter emphasizes the need for a comprehensive and interdisciplinary approach to address climate change. Such an approach must (1) credibly encompass the immense risks that global warming exerts on the Earth system; (2) account for the intricate processes of technical change and technology diffusion that are at the core of the low-carbon transition; (3) allow the percolation of risks and opportunities across sectors and regions; (4) account for behavioral change in consumption dynamics; and (5) allow testing of a wide range of climate policies and their robustness. Complex-systems science offers distinct vantage points for framing the intricate climate challenge. While outlining current research gaps, we argue that the current generation of climate-economy models rooted in complex systems provides a promising starting point to fill these gaps. We delve into a series of findings that evaluate the material impact of climate risks on economic and financial stability and explore alternative trajectories for policy implementation. Our analysis underscores the ability of complex-systems models to account for the extreme costs of climate change and the emergence of critical tipping points, wherein unmitigated emissions lead to free-falling declines in long-term growth and catalyze financial and economic instability. Given such findings, we argue that a complex-systems perspective on climate change advocates for stricter and earlier policy interventions than do traditional climate economy models. These policies can transform the seemingly antithetical objectives of decarbonization and economic growth in standard models into complementary ones. We assert that a combination of regulation and green industrial policies can nurture eco-friendly investments and foster technological innovation, thus steering the economy onto a zero-carbon sustainable growth pathway. These results challenge conventional precepts in the realm of cost-benefit climate economics and offer the building blocks for a more robust and realistic framing of the climate challenge. |
| Keywords: | climate change, complex system, agent-based modeling, decarbonization, climate risk |
| Date: | 2025–04–14 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/16 |
| By: | Linnea Nelli (Dipartimento di Politica Economica, DISCE, Università Cattolica del Sacro Cuore, Milano, Italy); Maria Enrica Virgillito (Institute of Economics, Scuola Superiore Sant’Anna, Pisa, Italy - Global Labor Organization (GLO), Essen, Germany); Marco Vivarelli (Dipartimento di Politica Economica, DISCE, Università Cattolica del Sacro Cuore, Milano, Italy – UNU-MERIT, Maastricht, The Netherlands – IZA, Bonn, Germany - Global Labor Organization (GLO), Essen, Germany) |
| Abstract: | The aim of this paper is to understand whether what has been labelled as “twin transition”, at first as a policy flagship, endogenously emerges as a new technological trajectory stemming by the convergence of the green and digital technologies. Embracing an evolutionary approach to technology, we first identify the set of relevant technologies defined as “green”, analyse their evolution in terms of dominant blocks within the green technologies and concurrences with digital technologies, drawing on 560, 720 granted patents by the US Patent Office from 1976 to 2024. Three dominant blocks emerge as relevant in defining the direction of innovative efforts, namely energy, transport and production processes. We assess the technological concentration and underlying complexity of the dominant blocks and construct counterfactual scenarios. We hardly find evidence of patterns of actual endogenous convergence of green and digital technologies in the period under analysis. On the whole, for the time being, the “twin transition” appears to be just a policy flagship, rather than an actual endogenous technological trajectory driving structural change. |
| Keywords: | Twin transition, policy flagship, technological trajectories |
| JEL: | O33 Q55 Q58 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:ctc:serie5:dipe0048 |
| By: | Marco Amendola; Marcelo C. Pereira |
| Abstract: | The paper examines the macroeconomic effects of fiscal policy under varying economic conditions. The analysis is conducted using a closed-economy agent-based model, where macroeconomic outcomes of fiscal intervention emerge from the bottom up as the result of interactions between heterogeneous agents in different markets, with feedback loops between demand, supply, and the financial sector. The model simulation results indicate that expansionary fiscal policies generate significant positive effects on aggregate output, with a public consumption multiplier of 1.6 on average, and an income tax multiplier of approximately 1.0. Notably, the effectiveness of a public direct consumption stimulus exhibits significant non-linearities, with multipliers reaching up to 3.5 during periods of economic slack and 2.5 during times of high financial fragility. In contrast, income tax rate multiplier appears largely acyclical. Overall, this analysis contributes to the growing and unsettled debate on the state-dependent effects of fiscal policy, providing model-based insights into this crucial topic. |
| Keywords: | Fiscal policy; State-dependent fiscal multipliers; Agent-based models; Non-linear dynamics |
| Date: | 2025–04–07 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/10 |
| By: | Sigle-Rushton, Wendy; Nunes, Débora M.; Sochas, Laura; Chanfreau, Jenny; Suh, Siri; Wilson, Kalpana |
| Abstract: | Despite evidence of a growing interest in reproductive justice (RJ) amongst feminist economists, this interest is nascent. To avoid RJ becoming a buzz word and losing its political and critical edge, it is important to fully grasp what the RJ framework means and brings to research. This Dialogue aims to create a space where the possibility of an interdisciplinary, transnational exchange of knowledge and ideas could be explored and encouraged. It presents four views about what it means to adopt and commit to the reproductive justice (RJ) framework in feminist research. One of the contributors was trained as an economist and the remaining contributors trained in other disciplines. The contributions discuss directly or show by example how research guided by the RJ framework can contribute to the development of an ethical and effective transformative response to an increasingly oppressive policy trajectory in the current historical moment. |
| Keywords: | reproductive health; reproductive justice; social reproduction; feminist epistemology; feminist politics |
| JEL: | B54 J13 D63 |
| Date: | 2025–03–31 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127183 |
| By: | Giovanni Dosi |
| Abstract: | There are at least three existential challenges to contemporary societies, as we know them namely first, the complete rupture of the social pact which characterized Glorious Decades after WWII in most of Western societies; and second, the deepening of the patterns of informatization and "intelligent" automation with the associated modifications in labour relations and mechanisms of social control. All that, third, is coupled with a climate crisis that might have well reached a tipping point toward a global ecological disaster. Here I shall briefly discuss the first, and even more briefly the second one, ending with some urgent policy implications. |
| Keywords: | Social Conflict, Social Pact, Inequality, Artificial Intelligence and Labour Processes, Environmental Crisis, Policy Objectives |
| Date: | 2025–04–14 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/15 |
| By: | Alexandre Rambaud (AgroParisTech, CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École nationale des ponts et chaussées - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique); Véronique Blum (UGA - Université Grenoble Alpes); Hugues Chenet (IÉSEG School Of Management [Puteaux]) |
| Abstract: | Our work examines Double Materiality, defined as the simultaneous consideration of ‘financial materiality' and ‘social and environmental materiality' in accounting, its conceptual and operational implications when addressing environmental issues, in particular related to biodiversity reporting. Mobilizing an analogic approach, we produce a conceptual framework of materiality, which defines some necessary generic notions, and which application leads to a classification of various approaches to DM. We focus on four of them: financial materiality according to the proprietary theory then according to the entity theory; social and environmental materiality according to a utilitarian anthropocentric approach then according to an ecological perspective. This analysis provides with a robust problematization of Double Materiality that sheds a new light on its current controversies. Our work also gives some guidance to stakeholders and policy makers by eliciting seven points of attention. |
| Keywords: | Double Materiality, Accounting, Sustainability reporting, Biodiversity, Ecology, Analogy |
| Date: | 2024–06–01 |
| URL: | https://d.repec.org/n?u=RePEc:hal:ciredw:hal-04979693 |
| By: | Xu, Tao Louie |
| Abstract: | This research investigates the role of political settlements in industrial policy, either facilitating or hindering capability development and structural transformation. The Global South’s power relations and institutions within policy processes, however, are not properly grasped. With the political settlements framework, the comparative research dissects the continuity and change of power and rent distribution in China and Indonesia under selective neoliberalism from 1990 to 2022, followed by case studies of First Automotive Works and Astra in auto manufacturing. The results illustrate that China has transitioned from a developmental settlement to vulnerable authoritarianism and back, while Indonesia has moved to competitive clientelism and elite ruling. The findings indicate that effective rent distribution of industrial policy counts on vertical legitimacy, whereas horizontal opposition exacerbates policy coherence. The interplay between industrial policy rents and the settlements concludes that consolidated power enables efficient resource allocation and policy efficacy; by contrast, power dispersal erodes development capacity due to political instability and interest divergences. For capability development and structural transformation, industrial policy design ought to align with specific power dynamics within varied institutions. |
| Keywords: | political settlements framework; industrial policy; selective neoliberalism; automotive manufacturing; China; Indonesia |
| JEL: | B5 B52 L5 L6 N4 N6 O1 O2 O3 O4 P5 |
| Date: | 2024–08–02 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:122669 |
| By: | Jiménez Sotelo, Renzo |
| Abstract: | This article contains an essay on the negative empirical relationship between bank profitability and economic development. The working hypothesis is that this relationship is caused by the social (in)efficiency with which the different banking sectors operate. The argument uses public information from the first two decades of the 21st century for almost one hundred and a half countries on the five continents. The topic, although it may seem very specialized, is of general interest. Firstly, because, within the current capitalist economic system, almost no sector of the economy can remain outside the world of finance. And secondly, because the profitability of the financial sector, as a whole, is the result of the degree of (in)efficiency with which it provides its services to the rest of the economic sectors. In theory, financial companies, in general, and banking companies, in particular, should mediate the greatest amount of funds possible in order to be able to more efficiently fulfill their central function (facilitate the allocation and deployment of the economic resources existing in each country), which enables greater economic development. To this end, banks must: (i) encourage the greatest possible domestic savings and (ii) finance investment in all low-risk projects, since high-risk projects require other types of financiers, or even partners. However, banking sectors stop operating as efficiently as they could when, in order to increase their profitability, they widen the differentials between their interest rates as much as possible, or even encourage the partial dollarization with which they operate. These practices mean that: (i) savings in national currency are discouraged by the low real returns provided to savers, (ii) low-risk projects are not financially viable, since, by their nature, they have lower returns, and (iii) economies are more vulnerable to the unpredictable change in the risk appetite of foreign capital and its overflow through the evolution of the exchange rate. |
| Keywords: | Banking; business cycle; financial development; banking spread; income equity; financial system. |
| JEL: | D63 E32 E43 G21 O16 |
| Date: | 2024–07–11 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:122367 |
| By: | Bruno Boidin (CLERSÉ - Centre Lillois d’Études et de Recherches Sociologiques et Économiques - UMR 8019 - Université de Lille - CNRS - Centre National de la Recherche Scientifique); Catherine Figuiere (CREG - Centre de recherche en économie de Grenoble - UGA - Université Grenoble Alpes); Géraldine Froger (LEREPS - Laboratoire d'Etude et de Recherche sur l'Economie, les Politiques et les Systèmes Sociaux - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - UT2J - Université Toulouse - Jean Jaurès - UT - Université de Toulouse - Institut d'Études Politiques [IEP] - Toulouse - ENSFEA - École Nationale Supérieure de Formation de l'Enseignement Agricole de Toulouse-Auzeville) |
| Abstract: | Contexte Les pays dits du Sud sont des terrains d'innovations sociales et environnementales majeurs en dépit de leurs grandes difficultés à aborder aujourd'hui les défis environnementaux et climatiques. A côté d'une vision dominante de l'économie et du développement axée sur l'énergie fossile et l'intégration dans les chaines de valeur globales, des voix et des approches différentes se sont depuis longtemps faites entendre. Ces dernières se trouvent à la fois du côté des chercheurs et penseurs critiques en économie du développement (Ignacy Sachs, François Perroux, Albert Otto Hirschman…) et du côté des pratiques (agroécologie, économie familiale et locale, communs locaux…). En parallèle, depuis plus de deux décennies, des travaux académiques se sont penchés sur la question des enjeux environnementaux par une autre porte d'entrée : celle de l'économie écologique et en particulier, de la socio économie écologique. Celle-ci entend renouer avec les fondements de l'économie écologique, qui s'était constituée dès la fin des années 1980 en rupture avec l'économie de l'environnement et des ressources naturelles, dans une perspective transdisciplinaire en soutenabilité forte, exprimant la volonté explicite de rompre avec le paradigme scientifique dominant en économie – fondé sur le marché et l'homo economicus comme concepts centraux, et sur la recherche de l'efficience comme finalité. En reprenant à son compte l'expression de « socio économie écologique », Clive Spash (2024) entend redonner à l'économie écologique des racines à la fois ontologiques, épistémologiques et méthodologiques, et une ouverture affirmée non seulement sur les sciences de l'environnement mais aussi sur les sciences humaines et sociales. De nombreux travaux de socio économistes écologiques portent sur les Suds (Martinez Alier 2003 ; Muradian et Martinez Alier 2001 ; Méral et Pesche, 2016 ; Froger, 2022). On peut ainsi considérer, aujourd'hui, qu'il existe une proximité entre au moins trois traditions de l'économie politique (AFEP, 2023) consacrée aux questions du développement dans les Suds en lien avec des enjeux environnementaux : l'approche des « anciens » économistes du développement hétérodoxes, qu'ils soient ou non classés chez les structuralistes ou les marxistes et qui ont toujours été critiques par rapport au modèle productiviste et financier du développement ; l'approche originale des penseurs critiques ayant proposé des notions nouvelles (écodéveloppement chez Sachs, décroissance ou post-croissance ou post-développement chez d'autres) ; enfin l'approche spécifique des socio économistes écologiques en rupture avec l'économie dominante. Problématique Cette communication cherche à établir des ponts entre ces différentes approches, partant du constat qu'elles sont rarement réunies ou comparées dans les travaux en économie politique, malgré leur proximité sur bien des points. En d'autres termes, nous proposons l'hypothèse selon laquelle Sachs, en tant qu'institutionnaliste du développement qui intègre systématiquement l'environnement (écodéveloppement) dès la fin des années 1960, pourrait constituer une « charnière » entre, d'une part, les institutionnalistes du développement qui s'intéressent à l'environnement, et d'autre part, les socio économistes écologiques qui s'intéressent au développement. Plus spécifiquement, nous cherchons à répondre à trois questions liées. 1/ Existe-t-il une socio économie écologique des Suds/du développement ? Si oui quelles sont ses particularités ? Cette question cherche à vérifier l'existence d'un corpus significatif de travaux mobilisant la démarche de la socio économie écologique dans les pays du Sud et à spécifier le cas échéant (voir question 3) les expériences qui constitueraient des objets privilégiés d'analyse dans cette approche. Sur ce point, Froger (2022) a déjà mis en évidence la pertinence d'une socio-économie écologique appliquée au développement dans les pays du Suds, et ce sillon mérite d'être creusé. 2/ Si elle existe, cette socio économie écologique des Suds présente-t-elle une proximité avec l'écodéveloppement d'Ignacy Sachs ? Boidin et Figuière (à paraître) estiment qu'Ignacy Sachs peut être rangé parmi les institutionnalistes du développement mais demeure original et en ce sens inclassable à plusieurs égards. Comme il a été souligné par Figuière et Metereau (2021), il existe une congruence certaine entre l'écodéveloppement et la socio économie écologique mais il conviendrait de pousser plus loin l'analyse en vérifiant cette conclusion sur les terrains de prédilection d'Ignacy Sachs (les « Suds » et pays émergents). 3/ Quelles sont ou quelles peuvent être les applications de la socio économie écologique dans les pays des Suds ? Plus précisément, il conviendrait de distinguer des études empiriques qui pourraient être qualifiées de « congruentes » avec les conclusions voire les préconisations de la socio économie écologique de celles qui seraient réalisées par les auteurs de la socio économie écologique à proprement parler dans une perspective de soutenabilité forte des politiques de développement. Quelles sont les convergences et les divergences de ces travaux avec ceux réalisés par les institutionnalistes du développement intéressés par les enjeux environnementaux ? Méthode En termes de méthode, la démarche de cette communication s'inscrit dans la continuité de travaux précédents des auteurs, en socio économie du développement, socio économie écologique et écodéveloppement (mise en perspective de l'œuvre prolifique mais parfois méconnue d'Ignacy Sachs). Le point de jonction entre ces différents éléments est l'inscription dans une approche institutionnaliste hétérodoxe. Cette démarche est fondée sur une revue de littérature préalable sur la socio économie écologique appliquée aux Suds (le volet le moins étudié à notre connaissance). Elle consistera à établir des critères de comparaison entre les institutionnalismes du développement, l'écodéveloppement d'Ignacy Sachs et la socio économie écologique appliquée aux Suds. Ces critères seront ensuite appliqués et permettront de détailler les grands traits de convergence et les différences entre ces trois socles, afin de proposer des réponses aux trois questions posées (cf. en annexe une première version des critères de comparaison). Organisation du propos Une première section portera sur l'élaboration des critères de comparaison (le tableau et sa construction), critères qui seront mobilisés dans un deuxième temps pour établir les congruences/convergences et différences entre les trois « groupes » de travaux. La troisième section comparera les objets des « pratiques dans les Suds » relevant de l'un ou l'autre des trois « corpus » (cette troisième section portera donc plus particulièrement sur des communs environnementaux). |
| Keywords: | écodéveloppement, socio-économie écologique, institutionnalismes, Suds, soutenabilité forte |
| Date: | 2025–06–04 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05000643 |