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on Heterodox Microeconomics |
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Issue of 2025–09–08
nine papers chosen by Carlo D’Ippoliti, Università degli Studi di Roma “La Sapienza” |
| By: | Carina Altreiter (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria); Theresa Hager (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; Socio-Ecological Transformation Lab, Johannes Kepler University Linz, Austria); Stephan Puehringer (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; Socio-Ecological Transformation Lab, Johannes Kepler University Linz, Austria) |
| Abstract: | Western societies face unprecedented interconnected crises—climate change, democratic instability, rising inequality, and growing science scepticism—that demand fundamental socio-ecological transformation within a compressed timeframe. However, current university systems, shaped by neoliberal restructuring and historically patriarchal logics, are structurally inadequate to support the critical research and societal engagement necessary for this transformation. This diminishes academia's relevance, exacerbating the post-truth crisis. We examine how competitive evaluation mechanisms, economic incentives and academic culture in contemporary academia hinder research conducive to socio-ecological transformations while perpetuating existing power structures and knowledge hierarchies. Through critical analysis of academic structures and knowledge production systems, drawing on existing literature across relevant fields, we build upon the concept of academic capitalism but extend it. We identify four interconnected pillars of what we term "capitalist academia": commodification of knowledge, publish-or-perish logic and competitization, social homogenization, and entrenched hierarchies. These structural features lead to a prioritization of individual competition over collaborative problem-solving, favor incremental research over transformative inquiry, and systematically exclude diverse perspectives essential for addressing complex socio-ecological challenges. Our analysis reveals how these structures of knowledge production not only fail to contribute meaningfully to societal transformation but actively contribute to reproducing the very systems that perpetuate ecological and social crises. We propose replacing these problematic pillars with four alternative principles—the "4Ds": Dialogue, Decommodification, Diversification, and Democratisation. This framework represents a pathway toward emancipatory academia that can meaningfully engage with socio-ecological transformation challenges while preserving scientific integrity. We also provide examples of existing initiatives and ideas where principles of the 4Ds are already in place, demonstrating practical pathways for reform and critically reflect on the adaptability of the current system of knowledge production. This research contributes to ongoing debates about academic reform while offering concrete directions for aligning higher education with sustainability imperatives and building the consensus needed for emancipatory socio-ecological transformation. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:ico:wpaper:164 |
| By: | Mateusz Wilinski; Juho Kanniainen |
| Abstract: | There are multiple explanations for stylized facts in high-frequency trading, including adaptive and informed agents, many of which have been studied through agent-based models. This paper investigates an alternative explanation by examining whether, and under what circumstances, interactions between traders placing limit order book messages can reproduce stylized facts, and what forms of interaction are required. While the agent-based modeling literature has introduced interconnected agents on networks, little attention has been paid to whether specific trading network topologies can generate stylized facts in limit order book markets. In our model, agents are strictly zero-intelligence, with no fundamental knowledge or chartist-like strategies, so that the role of network topology can be isolated. We find that scale-free connectivity between agents reproduces stylized facts observed in markets, whereas no-interaction does not. Our experiments show that regular lattices and Erdos-Renyi networks are not significantly different from the no-interaction baseline. Thus, we provide a completely new, potentially complementary, explanation for the emergence of stylized facts. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2508.20672 |
| By: | Alexandros Koskinas (Department of Economics, National and Kapodistrian University of Athens, Greece); Nikolaos Chatzarakis (Department of Economics, New School For Social Research, USA) |
| Abstract: | In the third volume of Capital (1894), Marx attempts to explain capitalist prices as a redistribution of an already created ‘wealth’ from the production process, along with profitability portraited as the ‘economic result’ of the exploitation of labor. To do so, he presented an algorithm for transforming the labor values into prices of production, which are defined in such a way as to follow the capitalist laws of exchange. Marx’s method was deemed inadequate, and attempts were made to ‘correct’ it, resulting to the well-known result of the impossibility of simultaneously satisfying the Marxian Equivalences (Bortkiewicz 1907). This shortcoming has led to a rich literature on the ‘transformation problem’, as well as to many different proposals for its solution; however, none of them has so far succeeded in being promoted as the undisputed solution to the ‘transformation problem’. In this paper, we argue that this limitation is not, as argued in the literature, a result of the futility of Labor Theory of Value to capture the exchange processes, but that of the identification of the (Sraffian) exchange prices with the (Marxian) prices of production. Moreover, we propose yet another solution to the ‘transformation problem’ by providing a new definition of prices of production, distinct from that of exchange prices, which consistently indicates a specific redistribution of the labor values in the process of circulation; under this definition, both equivalences posed by Marx are satisfied. Finally, we also present the main methods proposed to solve the (static) ‘transformation problem’ that are found in the literature, according to the interpretation they attribute to the transformation, and a numerical example, so as to distinguish them from the solution proposed in the paper. |
| Keywords: | Labor theory of value, transformation problem, prices of production |
| JEL: | B14 B24 B51 D46 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:new:wpaper:2513 |
| By: | Leiashvily, Paata |
| Abstract: | The monograph is devoted to a theoretical rethinking of the processes of simple, expanded, and contracted reproduction in a market economy and to a critique of the methodological foundations of the System of National Accounts (SNA). It shows that the inclusion of depreciation in gross product, as established in the SNA, is a methodological error that distorts macroeconomic indicators. As an alternative, the study substantiates the necessity of calculating gross product on the basis of net capital formation. On the basis of Smith’s Dogma and a reconstruction of K. Marx’s schemes, the conditions of equivalent exchange are formulated with clarifications: rent is treated as an independent form of income, profit is divided into consumed and saved parts, and depreciation is interpreted as redistribution rather than newly created value. Special attention is given to the problem of unfinished capital goods production. The key result of the research is the application of the Symmetric Model, which extends the principle of interaction between the two departments in Marx’s schemes to the entire set of branches, including households. The model is built on the methodological foundations of second-order dialectics, second-order cybernetics, and social constructivism. It helps explain the nature of cycles and crises as immanent forms of the reproduction process under the conditions of spontaneous self-regulation of a competitive economy. A separate chapter is devoted to reproduction under monopolization and financialization. It shows that the concentration of profit and the redistribution of resources in favor of the financial sector undermine the circular organization of the economy, distort the equivalence of exchange, and reinforce structural imbalances. Monopolization, inequality, and financialization are considered as factors that drive the market economy into systemic crisis. The concluding part of the monograph discusses the possibilities of mathematical formalization of reproduction processes. The Symmetric Model provides a foundation for constructing dynamic systems that describe interactions between sectors and factors of production. This enables stability analysis, the identification of endogenous sources of cycles, and the design of regulatory methods based on simulation modeling. The Appendices include AI Commentaries, which demonstrate new possibilities for analyzing and interpreting complex economic problems with the assistance of AI. This format combines rigorous theoretical argumentation with elements of additional verification and methodological validation provided by AI. The work is intended for researchers and practitioners in economic theory, macroeconomics, and institutional analysis, as well as all those interested in reproduction, crises, and the reform of the SNA. |
| Keywords: | economic reproduction; Smith’s Dogma; schemes of simple, expanded, and contracted reproduction; depreciation and capital consumption; System of National Accounts (SNA) methodology; Symmetric Model of economic equilibrium; operational closure of economic systems; mechanisms of economic self-regulation; cyclical dynamics of reproduction; monopolization processes; dynamics of financialization. |
| JEL: | C62 D3 E32 |
| Date: | 2025–08–31 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:125995 |
| By: | Martin Chalkley; Sakshi Mohan; Margherita Molaro; Bingling She; Wiktoria Tafesse |
| Abstract: | As health system modeling (HSM) advances to include more complete descriptions of the production of healthcare, it is important to establish a robust conceptual characterisation of the production process. For the Thanzi La Onse model in Malawi we have incorporated an approach to production that is based on a form of Leontief technology -- fixed input proportions. At first sight, this form of technology appears restrictive relative to the general conception of a production function employed in economics. In particular, the Leontief technology is associated with constant returns to scale, and level sets that are piecewise linear, both of which are highly restrictive properties. In this article we demonstrate that once incorporated into an all disease, agent-based model these properties are no longer present and the Leontief framework becomes a rich structure for describing healthcare production, and hence for examining the returns to health systems investments. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2508.21699 |
| By: | Claudius Graebner-Radkowitsch (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; Department of Pluralist Economics, Europa-University Flensburg, Germany); Birte Strunk (Department of Economics, Bard College, New York, USA;) |
| Abstract: | This paper is a first attempt to quantify the potential short-term effects on income and business profits that may occur in the Global South if the Global North were to implement policies to reduce and relocalize consumption and production. To this end, we use the EORA26 global inputoutput table to calculate dependency shares, which capture the share of incomes and profits in the Global South that manifests because of trade with the Global North. In the aggregate, we find that roughly a seventh of total incomes and profits in the South depends on trade in the North, although dependency varies significantly by region. We find that most of this dependency stems from trade of intermediate goods, not from exports for final demand. We also find that there is no single factor beyond trade-openness that clearly explains the differences in dependency among countries in the South, pointing to the importance of country-specific analyses. We therefore argue that a deeper understanding of the specific trade relations of any given country in the Global South with countries of the North is necessary for researchers interested in post-growth industrial policy as well as, more broadly, any type of policy-driven degrowth transitions in the Global North. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:ico:wpaper:163 |
| By: | Massimo Cervesato (Université Paris 1 Panthéon-Sorbonne, Centre d'Economie de la Sorbonne) |
| Abstract: | This article contrasts the ontological foundations of two major strands of the public choice tradition: the Virginia school, led by James M. Buchanan, and the Bloomington school, represented by Vincent and Elinor Ostrom. While their early collaboration was grounded in a shared ambition to apply economic reasoning to political analysis, the Bloomington school remained long marginalized. Its renewed visibility following Elinor Ostrom's Nobel Prize in 2009 has prompted efforts to reconcile the two schools. This article argues, however, that such reconciliations are only possible at the cost of simplification, which overlooks an ontological divide concerning the nature of collective action and the so-called 'constitutional moment'. Buchanan's framework, centered on exchange among rational individuals and the principle of unanimity, stands in sharp contrast to the Ostroms' institutionalist approach, which emphasizes reciprocity and the formation of "communities of shared understanding" as the foundation of collective action. These ontological differences underpin distinct methodological commitments and ultimately entail important nuances in their practical approaches to public sector governance. In highlighting this contrast, the article also advances the relevance of social ontology as a conceptual lens for the history of economic thought |
| Keywords: | Constitutional Choice; Ostrom (Elinor); Ostrom (Vincent); Buchanan (James, M); Social Ontology; Rules; Methodological Individualism |
| JEL: | B25 B31 B41 B52 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:mse:cesdoc:25017 |
| By: | Legrenzi, Demis; Ciola, Emanuele; Bazzana, Davide |
| Abstract: | This paper examines the macro-financial effects of alternative adaptation strategies in response to exogenous shocks in labor productivity caused by climate change. Using a Stock-Flow-Consistent Agent-Based model calibrated to U.S. data, we analyze two main scenarios: (i) a change in the conduct of monetary policy to account for climate-related damages, and (ii) a firm-level adaptation strategy that internalizes expected climate losses. We evaluate both scenarios under the assumption of either homogeneous or heterogeneous climate shocks. Our results indicate that both strategies can mitigate the adverse effects of climate change on output and wealth distribution. However, their performance is significantly worse in the presence of heterogeneous climate shocks, which also lead to a persistent increase in firms’ leverage. Moreover, while firm-level adaptation relies primarily on internal resources, monetary policy adjustments increase firms’ dependence on external debt financing, underscoring the need for closer monitoring of financial stability in such circumstances. |
| Keywords: | Climate Change, Labor and Human Capital |
| Date: | 2025–08–07 |
| URL: | https://d.repec.org/n?u=RePEc:ags:feemwp:369004 |
| By: | Charlier, Niels; Tideman, Nicolaus |
| Abstract: | We begin this essay with an analysis of the criticism of orthodox economics from a philosophy of science and methodological point of view. Rather than idealized models, a careless definition of ”capital” appears to be the problem. We owe this careless definition to John Bates Clark (1847–1938). Clark introduced a new paradigm that proposed that land is not a separate factor of production, but only a form of capital. His theory was a reaction to the American economist and philosopher Henry George (1839–1879) who sold millions of books and was exceptionally popular. George advocated a substantial land value tax and influenced political debate for several decades in the Anglo-Saxon world and elsewhere. We sketch George’s ideas in their historical context and give an overview of his unappreciated impact on global scientific, political and cultural history. Finally, we also show George’s relevance in today’s world and provide a scientific and social critique of the Clark paradigm. |
| Date: | 2025–08–17 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:ep2a6_v1 |