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on Heterodox Microeconomics |
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Issue of 2026–04–27
fourteen papers chosen by Carlo D’Ippoliti, Università degli Studi di Roma “La Sapienza” |
| By: | Alok Yadav; Saroj Yadav |
| Abstract: | Traditional macroeconomic growth models rely on general equilibrium and continuous, frictionless institutional transitions, failing to account for the catastrophic structural collapses observed in empirical economic history. We propose the Stochastic Networked Governance (SNG) model, a discrete-time, agent-based framework that bridges econophysics, network science, and institutional economics. By defining jurisdictions through a binary institutional genome, the model formalizes institutional complementarity, endogenous growth, and the non-linear macroeconomic penalties of structural reform (the "J-Curve"). Using the CEPII Gravity Database and the IMF Systemic Banking Crises dataset, we move beyond theoretical topologies to execute an empirical historical simulation from 1970 to 2017 across the top 100 global economies. Through Monte Carlo ensembles, we demonstrate how scale-invariant exogenous shocks and spatial capital flight drive global phase transitions, exposing the mathematical mechanics of the 1989-1991 Soviet collapse, the Hub-Risk Paradigm, and the emergent resilience of spatially firewalled market networks. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.19968 |
| By: | IM, HYUN-NAM |
| Abstract: | This paper challenges the fundamental assumptions of mainstream economics, particularly the concept of Homo Economicus (the rational economic man) and the mathematical illusion of general equilibrium. By integrating Giambattista Vico’s cyclical philosophy of history with established economic theory, this treatise proposes a new ontological framework for understanding modern capitalism. First, this paper redefines human economic behavior not as rational choice, but as the dynamic interaction of an ontological triad structured around libido, anxiety, and sin. Second, it diagnoses the 21st century as the ‘Era of Grand Analogy’, in which physical imitation and administrative bureaucracy have given rise to a state of collective amorality (Søren Kierkegaard’s Åndløshed). Third, it deconstructs the ‘equal sign (=)’ of macroeconomics as a mere decalcomanic illusion created by densely aggregated data. Furthermore, it traces how this illusion solidified into a natural theory in tandem with the exponential expansion of currency, population, and administration, thereby exposing it as a mechanism that conceals the ‘legalized plunder’ perpetrated by vested interests. In particular, this paper rejects the conventional, dry mathematical style of academic writing, instead adopting a metaphorical and literary mode of exposition that embeds Vico’s cyclical philosophy of history into the very structure of the text itself. Ultimately, this paper argues that economics must be understood as fundamentally distinct from Platonic political idealism; rather, it is the immanent law of the masses—a living embodiment of Vico’s principle verum ipsum factum (the truth is what is made). It concludes that the resolution to the modern structural crisis lies not in the mechanical adjustment of economic variables, but rather in the restoration of Aristotelian ethics and authentic education. |
| Keywords: | Giambattista Vico, Legalized Plunder, Era of Grand Analogy, Aristotelian Ethics, Ontological Triad. Heterodox Economics, Macroeconomic Theory. |
| JEL: | B41 E32 K00 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128737 |
| By: | Simon Cottin-Marx (LISE - Laboratoire interdisciplinaire pour la sociologie économique - Cnam - Conservatoire National des Arts et Métiers [Cnam] - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | This article examines the autonomy of the French vocational training system through an analysis of the vocational training policies of "Uniformation", the skills operator for the social and solidarity economy. In the context of weakening joint bodies vis-à-vis the State, following the 2018 "Professional Future" law, the study highlights how the branches composing the OPCO build a degree of autonomy by collecting contributions established through collective agreements, enabling them to implement their own vocational training policies. The article analyses the factors behind this particularity, taking into account the nature of employers in the social and solidarity economy, the size of member organisations, sectoral contexts, and the role of public action within them. It concludes that while the social and solidarity economy remains subject to the norms of the dominant economy, labour relations are characterised by distinctive practices that differentiate them from the for-profit private sector. Without erasing the antagonism between labour and management, the study of industrial relations shows that the two sides are "in the same boat, " working to maintain their autonomy in order to develop sectoral policies despite a State that tends to take back control. |
| Abstract: | Cet article interroge l'autonomie du système de formation professionnelle français à travers l'étude des politiques de formation professionnelle de l'Opérateur de compétences (OPCO) de l'économie sociale et solidaire, nommé « Uniformation ». Dans un contexte d'affaiblissement des structures paritaires face à l'État, consécutif à la loi dite « Avenir professionnel » de 2018, l'étude met en lumière la manière dont les branches qui composent l'OPCO construisent leur autonomie en collectant des contributions conventionnelles leur permettant de conduire des politiques de formation professionnelle. Le texte analyse les raisons de cette particularité, en tenant compte de la nature des structures employeuses de l'économie sociale et solidaire, de la taille des structures adhérentes, des contextes sectoriels et du rôle de l'action publique au sein de ceux-ci. Il conclut que, si l'économie sociale et solidaire demeure soumise aux normes de l'économie dominante, les relations professionnelles se caractérisent par des pratiques distinctives qui les différencient du secteur privé lucratif. Sans effacer l'antagonisme salarial, l'étude des relations professionnelles révèle des acteurs paritaires « dans le même bateau », œuvrant à construire leur autonomie pour élaborer des politiques de branche malgré un État qui tend à reprendre la main. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05592143 |
| By: | Constantin Ghioanca (Baptist Theological Institute, Bucharest, Romania) |
| Abstract: | This paper aims to bring C. S. Lewis’s views on education into the contemporary arena of Posthumanist philosophy. The latest debates in the academic world and in Posthuman studies, in general, focus on the ‘Posthuman condition, ’ ‘Life’ as a non-essentialist form of contemporary vitalism, and ‘Life’ as a complex materialist system. According to this worldview, Posthuman education seeks to value various concepts such as Karen Barad’s ‘agential realism, ’ Luciana Parisi’s ‘theory of complexity, ’ Rosi Braidotti’s ‘Anthropocene studies, ’ or Katherine Hayles’s ‘digital posthumanist studies.’ As interesting and rich as these innovations may seem, we argue that they do not capture the complexity of reality or consider the human condition, including its metaphysical dimension. This is where C. S. Lewis comes onto the scene. His deep insights on the importance and value of education are more necessary than ever, especially as we interact with Posthuman Philosophy. |
| Keywords: | Posthumanist Education, C. S. Lewis, Posthumanism, New Materialism, Environmental Education, Virtue, Metaphysics |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:smo:raiswp:0645 |
| By: | Ethan Ratliff-Crain; Colin M. Van Oort; Matthew T. K. Koehler; Brian F. Tivnan |
| Abstract: | This study strengthens the foundations of multi-venue market modeling by attempting an independent replication of Wah and Wellman's 2016 model of latency arbitrage in a fragmented market. We find that faithful replication is hindered by missing implementation details in the original paper and limited quantitative reporting. We demonstrate that increasing the number of simulation runs beyond the original design allows for the creation of bootstrap confidence intervals to support rigorous tests of quantitative alignment, compensating for lacking distributional information (e.g. variance). We also demonstrate that increased complexity across the modeled scenarios corresponds with increased difficulty aligning to the original results. We draw on a codebase released by the original authors in connection with a later paper to recover additional implementation details; however, we reject quantitative alignment between that codebase and the published results. Combining information from the paper and the released code, we achieve relational equivalence for most metrics but reject quantitative alignment for model settings where latency is non-zero. We show that many of the qualitative takeaways from the original paper on the effects of market fragmentation and latency arbitrage are sensitive to the specifics of a `greedy strategy' extension given to the zero-intelligence (ZI) trader agents. Under an alternative interpretation of this strategy, we find that market fragmentation decreases execution times in all experiments and increases trader welfare in most experiments. Finally, to facilitate future replication, critique, and extension, we provide an ODD (Overview, Design concepts, Details) protocol for our implementations of the model. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.20067 |
| By: | Ewa Weychert (University of Warsaw, Faculty of Economic Sciences); Tomasz Kopczewski (University of Warsaw, Faculty of Economic Sciences) |
| Abstract: | Students of introductory economics courses pointed out that economic inequality the most significant challenge in the 21st century (Bowles & Carlin, 2020). However, there is limited research on how this issue is portrayed in introductory textbooks. Our study aims to investigate the presentation of economic inequality in economics textbooks compared to sociological ones. We conduct a mixed-method study to examine differences in how introductory economics and sociology textbooks portray economic inequality. By focusing on the comparison between economic and sociological textbooks, we aim to highlight the importance of an interdisciplinary approach to studying economic inequalities, as advocated by economist Thomas Piketty (Korom, 2019). Comparing textbooks across disciplines is essential for informing curriculum development, encouraging interdisciplinary learning, and enhancing the relevance of education to real-world issues. This comparison provides insights that help integrate diverse perspectives on economic inequality into educational practices in both disciplines. Our analysis includes twelve introductory economics textbooks and three introductory sociological textbooks. We find significant differences: top-selling economics textbooks focus on statistical measurements of inequality and the trade-off between equality and efficiency, while sociological textbooks consider economic inequality from historical, cultural, and philosophical perspectives. |
| Keywords: | income inequality, wealth inequality, textbook analysis, narrative economics, qualitative research |
| JEL: | A23 D63 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:war:wpaper:2026-10 |
| By: | Alberto Baccini; Carlo Debernardi |
| Abstract: | This paper investigates the evolution of self-referentiality and knowledge flows in economics journals before and after the 2008 financial crisis. Using a multi-level approach, we analyze patterns at the discipline, cluster, and journal levels, combining citational measures with a classification of journals based on intellectual similarity and social proximity. At the aggregate level, results suggest a general decline in self-referentiality, indicating increased openness across the discipline. However, this trend conceals substantial heterogeneity. At finer levels of analysis, two clusters - CORE and Finance - emerge as persistent outliers, exhibiting very high levels of self-referentiality. While Finance experienced a gradual reduction over time, the CORE shows increasing closure. By examining reference asymmetries, we uncover a hierarchical structure of knowledge flows. The CORE operates as a central hub and net exporter of knowledge to all other clusters, particularly to the traditional core fields of economics, whereas Finance acts as a net exporter only within its own domain and remains dependent on the CORE. These asymmetries are reinforced at the level of individual journals, where a small set of top journals occupies the apex of a hierarchically ordered system of knowledge transmission. We argue that these patterns reflect the interplay between intellectual dynamics and organizational structures, particularly the role of editorial networks in shaping access to publication and visibility. The findings suggest that, following the financial crisis, economics has experienced a process of increasing epistemic and organizational closure at its core, alongside greater openness in peripheral areas. This dual dynamic raises questions about the representativeness of top journals and the evolving structure of the discipline. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.18144 |
| By: | Maxime Saxena; Marco Pangallo; Fabio Caccioli; R. Maria del Rio-Chanona |
| Abstract: | As Large Language Models (LLMs) become increasingly integrated into financial systems, understanding their behavioural properties is crucial. Do LLMs conform to the rational expectations paradigm, do they exhibit human-like "animal spirits", or do they instead manifest distinct "machine spirits"? We investigate these questions with a simulated financial market, exploring the behaviour of 15 LLMs spanning a range of sizes, capabilities, and providers. Our results show that LLMs exhibit a spectrum of economic behaviours, from stable coordination on the fundamental value to human-like speculative bubbles. These behaviours are generally inconsistent with the rational expectations hypothesis. We also consider an ecology of heterogeneous agents, a more realistic setting compared to markets with identical LLM agents. These mixed markets can produce outcomes which vary substantially across repeated simulations. Even the most advanced models fail to consistently stabilise the market, with price bubbles sometimes forming despite only a minority of agents naturally forming bubbles. Instead, advanced models in mixed markets adapt their forecasting strategies to the behaviour of other agents. This adaptation can allow them to successfully exploit less sophisticated counterparts and achieve higher profits, but can also contribute to increased market volatility. These findings suggest that the introduction of AI agents into financial markets fundamentally reshapes their ecology. In particular, heterogeneous populations of LLMs can generate endogenous instability, while individual-level adaptation may amplify, rather than mitigate, market volatility. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.18602 |
| By: | Jan Kwakkel; Willem L. Auping; Jan Willem van den End |
| Abstract: | We introduce Exploratory Modelling and Analysis (EMA) as a framework for macroeconomic scenario analysis under deep uncertainty. EMA traces scenarios of interest from policy‑relevant outcomes. These outcomes are forecasted by a model, based on a large set of uncertain conditioning variables. This approach flips the conventional method of scenario analysis, by sampling many scenarios without imposing strong ex‑ante priors on the choice, combination, value, or distribution of the conditioning variables. Applying EMA with an interacted VAR model to financial stress scenarios for the euro area shows that scenarios of interest can be uncovered that may be overlooked by common approaches for scenario analysis. |
| Keywords: | Financial shocks; Scenarios; Exploratory modelling; Deep uncertainty |
| JEL: | E52 E58 G12 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:dnb:dnbwpp:860 |
| By: | Johan Fourie |
| Abstract: | Examines how political coalitions shape economic growth outcomes in South Africa, analysing the incentives and constraints facing key actors in the growth policy arena. |
| Keywords: | political economy, growth coalitions, South Africa, institutions |
| JEL: | O43 P16 D72 |
| Date: | 2026–03–17 |
| URL: | https://d.repec.org/n?u=RePEc:cxs:wpaper:202604 |
| By: | Mariko I. Ito; Hiroyuki Hasada; Yudai Honma; Takaaki Ohnishi; Tsutomu Watanabe; Kazuyuki Aihara |
| Abstract: | Market instability has been extensively studied using mathematical approaches to characterize complex trading dynamics and detect structural change points. This study explores the potential for early warning of market instability by applying the Dynamical Network Marker (DNM) theory to order placement and execution data from the Tokyo Stock Exchange. DNM theory identifies indicators associated with critical slowing down -- a precursor to critical transitions -- in high-dimensional systems of many interacting elements. In this study, market participants are identified using virtual server IDs from the trading system, and multivariate time series representing their trading activities are constructed. This framework treats each participant as an interacting element, thereby enabling the application of DNM theory to the resulting time series. The results suggest that early warning signals of large price movements can be detected on a daily time scale. These findings highlight the potential to develop practical DNM-based early-warning systems for large price movements by further refining forecasting horizons and integrating multiple time series capturing different aspects of trading behavior. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.21297 |
| By: | Fahd Zulfiqar (Pakistan Institute of Development Economics) |
| Abstract: | Within Development Studies, the relationship between Anthropology and Development, has been documented as uneven, inconsistent, and marred with conceptual complexity and pragmatic ambivalence. The complexity becomes more vivid when Anthropology is traced within Development Studies in the context of Pakistan wherein the theoretical and applied domains of Anthropology are singularly separated. The current knowledge brief is an attempt to articulate the normative and instrumental dimensions of development, position Anthropology within Development Studies, as a theoretical domain, as an analytical inquiry, and as a pragmatic space, and finally trace ways to engage both disciplines for social change that is needed, unforced, and comes from within. The contested definitions of development, the competing debates around Development-Anthropology articulation, and the application of anthropological knowledge for meeting incremental or normative needs of development practice have also been detailed in the write-up. |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:pid:kbrief:2026:141 |
| By: | Kundan Mukhia; Imran Ansari; Md. Nurujjaman |
| Abstract: | We identify a robust structural signature of stock markets during exogenous shock events by analyzing collective return dynamics across G5 countries. Using Random Matrix Theory, we introduce the complexity gap, defined as the difference between the normalized largest eigenvalue and the average pairwise correlation, to quantify changes in market structure. This measure reveals a consistent three-phase pattern across multiple shocks, including the 2025 U.S. tariff event, the COVID-19 crisis, and country-specific shocks in Japan and China during 2024. Before a shock, markets show a positive complexity gap, reflecting a rich structure with multiple interacting factors. During shocks, the gap collapses to near zero, signaling strong synchronization under a single dominant mode. Post-shock recovery follows a nonmonotonic path: an initial widening (a false recovery), a temporary recollapse, and final sustained restoration. This pattern holds at both market and sector levels and across global and local shocks. Ordinal entropy analysis confirms the same sequence of collapse and false recovery in directional diversity. We further demonstrate that lower complexity gap values predict higher future portfolio volatility, especially after shocks, establishing its value as a state-dependent risk indicator. For investors, initial gap widening may mislead, while sustained widening signals genuine structural stabilization. These findings reveal a robust structural signature governing financial market dynamics during crisis and recovery periods. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.19107 |
| By: | Nima Afsharhajari; Jonathan Yu-Meng Li |
| Abstract: | Sparsity or complexity? In modern high-dimensional asset pricing, these are often viewed as competing principles: richer feature spaces appear to favor complexity, while economic intuition has long favored parsimony. We show that this tension is misplaced. We distinguish capacity sparsity-the dimensionality of the candidate feature space-from factor sparsity-the parsimonious structure of priced risks-and argue that the two are complements: expanding capacity enables the discovery of factor sparsity. Revisiting the benchmark empirical design of Didisheim et al. (2025) and pushing it to higher complexity regimes, we show that nonlinear feature expansions combined with basis pursuit yield portfolios whose out-of-sample performance dominates ridgeless benchmarks beyond a critical complexity threshold. The evidence shows that the gains from complexity arise not from retaining more factors, but from enlarging the space from which a sparse structure of priced risks can be identified. The virtue of complexity in asset pricing operates through factor sparsity. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.17166 |