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on Heterodox Microeconomics |
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Issue of 2024–12–09
nine papers chosen by Carlo D’Ippoliti, Università degli Studi di Roma “La Sapienza” |
| By: | Jhordan Silveira Borba; Sebastian Gon\c{c}alves; Celia Anteneodo |
| Abstract: | We analyze inequality aspects of the agent-based model of capitalist economy named it Social Architecture of Capitalism that has been introduced by Ian Wright. The model contemplates two main types of agents, workers and capitalists, which can also be unemployed. Starting from a state where all agents are unemployed and possess the same initial wealth, the system, governed by a few simple rules, quickly self-organizes into two classes. After a transient, the model reproduces the statistics of many relevant macroeconomic quantities of real economies worldwide, notably the Boltzmann-Pareto regimes of the distributions of wealth and income. We perform extensive simulations testing the role of the model parameters (number of agents, total wealth, and salary range) on the resulting distribution of wealth and income, the social distribution of agents, and other stylized facts of the dynamics. Our main finding is that, according to the model, in an economy where total wealth is conserved and with a fixed average wage, the increase in wealth per capita comes with more inequality. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.22369 |
| By: | Villalba, Maria Luisa; Spinola, Danilo; Ruiz, Walter |
| Abstract: | This article explores the coevolutionary dynamics of immature innovation systems (IMIS), focusing on the role of marginalized agents often excluded from Conventional Innovation Systems (CIS). Marginalized agents, such as informal entrepreneurs or low-resource communities, are key actors in addressing local challenges but are typically overlooked in mainstream innovation processes, making it crucial to understand how they can be integrated into broader systems. Using an Agent-Based Model (ABM) based on Villalba (2023) and Ruiz et al. (2016), we examine how interactions between agents with different innovation and inclusion capabilities drive system evolution. The model integrates learning and unlearning processes, allowing agents to adapt and build capabilities over time. Through simulations that vary social thresholds, agent configurations, NOPI (Needs, Opportunities, Problems and Ideas) complexity, and the presence or absence of learning, we find that while higher social thresholds and complex NOPIs foster agent specialization, they can limit the inclusion of marginalized agents. Conversely, the absence of learning results in system stagnation despite increased short-term inclusion. By adopting a system-wide perspective, this paper contributes to the literature on innovation systems by analyzing how the relationships between marginalized and conventional actors influence inclusion dynamics. Our ABM captures the complex interplay of inclusion, coevolution, and capability complementarity within IMIS, offering deeper insights into how marginalized agents drive inclusive innovation and emphasizing the importance of fostering both innovation and inclusion capabilities for sustainable, equitable outcomes. |
| Keywords: | Coevolution; Heterogeneous agents; Immature innovation system; Developing countries; Excluded agents |
| Date: | 2024–11–08 |
| URL: | https://d.repec.org/n?u=RePEc:akf:cafewp:31 |
| By: | Obregon, Carlos |
| Abstract: | In social sciences there has been a long debate between the defenders of institutionalism and those of liberalism. The debate has centered around the relationship that exists between the individual (agent) and the social institutions (social structure). In general, liberalism defends that the individual ́s (agent ́s) preferences, choices, and behavior define the social institutions (social structure); while institutionalism argues that the social institutions define the individual ́s preferences, choices, and behavior. Some authors have attempted to solve the debate by proposing a dual feedback loop between the individual and the social institution, in which both mutually define each other. But the solution is not as simple as that. In this book, it is argued that liberalism is fully compatible with institutionalism, although only by following a pragmatic-scientific conception of both. It is ascertained that liberalism is an institution, that was born in a particular historical period of the Western societies. Therefore, since liberalism itself is an institution, it follows that liberalism is compatible with institutionalism. It is argued in here that although it is in general true that institutionalism defends that individual preferences, choices, and behaviors are defined by social institutions; once the society grants the individuals political and economic freedom, these individual preferences, choices, and behaviors become critical in defining the dynamics of the institutional arrangement in question – as liberalism has pointed out. |
| Keywords: | institutionalism, liberalism, individual, social institutions, social structure, preferences, choices, behavior, Western societies, society, political, politics, economic |
| JEL: | A10 A12 A13 A14 B00 B30 B31 G00 G01 G02 G20 G28 G29 H00 N00 P00 P20 P25 P26 P40 R00 |
| Date: | 2023–03–03 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:122455 |
| By: | Lyons, Benjamin Frederick; Levin, Michael |
| Abstract: | Collective intelligence refers to emergent problem-solving capacities that are different than those of the system’s subunits. Due to the plethora of multi-scale systems within nature and society, it is imperative to understand the interaction policies necessary and sufficient for subunits to form collective intelligences. The economy is a complex system consisting of autonomous elements at multiple scales and which exhibits adaptive problem-solving capabilities, suggesting that the economy offers an interesting and important example of collective intelligence. We identify the price system as the cognitive glue of the economy which works to coordinate the economy by acting as an affordance that allows members of the economy to use it to form plans that are mutually compatible with the plans of every other member of the economy. Using the existing collective intelligence framework of Watson and Levin [1] we elaborate on various aspects of the economy that make it useful to model the economy as a collective intelligence. We argue that any cognitive glue must solve the same kind of problem that the price system solves in broadly the same way that the price system solves it, and thus the price system serves as a generic template or abstract model for all cognitive glues. Finally, we describe some research ideas that combine concepts from biology and economics in the hopes of inspiring interdisciplinary collaboration. |
| Date: | 2024–11–07 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:3fdya |
| By: | Yihang Luo; R. S. MacKay; Nick Chater |
| Abstract: | In this paper, we test predictions of a new theory of macroeconomics, called "thermal macroeconomics." The theory aims to apply the mathematical structure of classical thermodynamics, including analogues of temperature and entropy, to predict aspects of the aggregate behaviour of populations of economic agents without analyzing their detailed interactions. We test the theory by comparing its predictions with the behaviour of a variety of simulated micro-economies in which goods and money can be exchanged between agents, confirming the predictions of the theory. The paper serves also to illustrate and make more tangible the predictions of thermal macroeconomics. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.20497 |
| By: | Mills, Stuart; Whittle, Richard |
| Abstract: | The UK Behavioural Insights Team transformed nudging and behavioural economics from nascent ideas to key policy tools for the UK Coalition Government. This article argues that political economic circumstances significantly contributed to the success of this ‘nudge’ programme. The Global Financial Crisis (GFC) created a ‘contest of authority’ over dominant policy approaches. By framing the crisis as a crisis of rationality, behavioural perspectives gained political support. The GFC also saw that the UK Government (from 2010) adopt a programme of fiscal austerity. Nudging complemented this programme by suggesting effective policy could be made cheaply. Using various accounts of nudging in the UK from those involved in its development, we demonstrate the role of the country’s political economy in the behavioural turn. We conclude by reflecting on the role of behavioural insights today, given a political–economic landscape much changed since 2010. |
| Keywords: | austerity; behavioural economics; nudge; political economy |
| JEL: | D90 |
| Date: | 2024–10–25 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:126042 |
| By: | Minh Tam Bui (Faculty of Economics, Srinakharinwirot University, THAILAND); Ivo Vlaev (Warwick Business School, University of Warwick, UK); Katsushi Imai (Department of Economics, The University of Manchester, UK and Research Institute for Economics and Business Administration, Kobe University, JAPAN) |
| Abstract: | Ageing society poses an increasing need for elderly care and the essential role of unpaid family care in developing countries where more care burdens are imposed on women. Literature on the driver of gender care gap is limited and its association with social gender norms is both understudied and hardly measured/quantified. Using time-use data in 2014-15 and Labor Force Survey data in 2013-15 from Thailand, we first construct an altruistic time ratio for the whole sample to measure the extent to which individuals spend time on unpaid activities for others than themselves. We found that significant gender gaps in providing eldercare are associated with gender differences in altruistic time ratio. To consider the non-random selection for the elderly care, we then estimate the Tobit model with propensity score matching (PSM) for both elderly carers and non-carers and found that the social gender norm, defined as the district-level gender difference in the modes of altruistic time ratio, explains why women are more burdened with elderly care than men. To examine the underlying mechanisms behind women's time burden, we estimate a simultaneous equation Tobit consisting of elderly care time, leisure time, and time for paid work. The results show that the social gender norm indirectly reduces elderly care time for women by significantly reducing leisure time and paid work time, while the direct effect is dominant for men. The trade-off between paid work time and elderly care time is similar for men and for women, while that between leisure time and elderly care time is greater for men. Associations between elderly care and altruism or peer pressure imply that behavioural changes with a focus on social norms and social policies inducing such changes are important to achieve more gender-equitable eldercare provision besides the state provision of long-term care. |
| Keywords: | Unpaid work; Time use; Elder care; Gender gaps; Altruism; Behavioral change |
| JEL: | D13 D64 D9 J14 J16 J22 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:kob:dpaper:dp2024-37 |
| By: | Alexa Orton; Tim Gebbie |
| Abstract: | We consider financial market regime detection from the perspective of deep representation learning of the causal information geometry underpinning traded asset systems using a hierarchical correlation structure to characterise market evolution. We assess the robustness of three toy models: SPDNet, SPD-NetBN and U-SPDNet whose architectures respect the underlying Riemannian manifold of input block hierarchical SPD correlation matrices. Market phase detection for each model is carried out using three data configurations: randomised JSE Top 60 data, synthetically-generated block hierarchical SPD matrices and block-resampled chronology-preserving JSE Top 60 data. We show that using a singular performance metric is misleading in our financial market investment use cases where deep learning models overfit in learning spatio-temporal correlation dynamics. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.22346 |
| By: | Xuewen Han; Neng Wang; Shangkun Che; Hongyang Yang; Kunpeng Zhang; Sean Xin Xu |
| Abstract: | In recent years, the application of generative artificial intelligence (GenAI) in financial analysis and investment decision-making has gained significant attention. However, most existing approaches rely on single-agent systems, which fail to fully utilize the collaborative potential of multiple AI agents. In this paper, we propose a novel multi-agent collaboration system designed to enhance decision-making in financial investment research. The system incorporates agent groups with both configurable group sizes and collaboration structures to leverage the strengths of each agent group type. By utilizing a sub-optimal combination strategy, the system dynamically adapts to varying market conditions and investment scenarios, optimizing performance across different tasks. We focus on three sub-tasks: fundamentals, market sentiment, and risk analysis, by analyzing the 2023 SEC 10-K forms of 30 companies listed on the Dow Jones Index. Our findings reveal significant performance variations based on the configurations of AI agents for different tasks. The results demonstrate that our multi-agent collaboration system outperforms traditional single-agent models, offering improved accuracy, efficiency, and adaptability in complex financial environments. This study highlights the potential of multi-agent systems in transforming financial analysis and investment decision-making by integrating diverse analytical perspectives. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2411.04788 |