nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2006‒08‒12
eleven papers chosen by
Erik Thomson
University of Chicago

  1. Sobre a filosofia moral de Adam Smith By Hugo E. A. da Gama Cerqueira
  2. Keynes among the Statisticians By Aldrich, John
  3. Becker’s Theories of Marriage and the Shrinking Role of Demand and Supply Models By Shoshana Grossbard
  6. "Banking, Finance, and Money: A Socioeconomics Approach" By L. Randall Wray
  7. Contemporary research in ecological economics: five outstanding issues By A. Batabyal
  8. Is Man Doomed to Progress? By Claudia Senik
  9. Wirtschaftliche Entwicklung und Demokratie: Ist Demokratie ein Wohlstandsmotor oder ein Wohlstandsprodukt? By Uwe Sunde
  10. What is fair? Experimental evidence By D. Dickinson; J. Tiefenthaler
  11. Consensual and Conflictual Democratization By Matteo Cervellati; Piergiuseppe Fortunato; Uwe Sunde

  1. By: Hugo E. A. da Gama Cerqueira (Cedeplar-UFMG)
    Abstract: This article examines Adam Smith’s Theory of moral sentiments. Taking as its point of departure the moral philosophy of the Scottish enlightenment, the paper presents the central argument of Smith’s Theory. It analyses the concepts of “sympathy” and “impartial spectator” and points to the originality of Smith’s argument on the relationship between morality and sociality.
    Keywords: Adam Smith; sympathy; impartial spectator; moral Newtonianism; Scottish enlightenment
    JEL: B30 B40
    Date: 2006–08
  2. By: Aldrich, John
    Abstract: This paper considers J. M. Keynes as a statistician and philosopher of statistics and the reaction of English statisticians to his critique of their work. It follows the development of Keynes's thinking through the two versions of his fellowship dissertation The Principles of Probability (1907/8) to his book A Treatise on Probability (1921). It places Keynes's ideas in the context of contemporary English and Continental statistical thought. Of the statisticians considered special attention is paid to the reactions of .four: Edgeworth, Bowley, Jeffreys and R. A. Fisher. Keywords; Keynes, Edgeworth, Bowley, Pearson, Jeffreys, Fisher, Lexis, Bortkiewicz. JEL Classification: B16 B23 B30
  3. By: Shoshana Grossbard (Department of Economics, San Diego State University)
    Abstract: This paper argues that Gary Becker has been a leader in the economics of marriage not only as a pioneer but also as a leader who influenced the work of other economists who entered this field over at least two decades. A comprehensive survey of economic research on marriage is presented for the years 1970-1993. A distinction is drawn between earlier entrants and later entrants, the dividing line being 1980, coinciding with the publication of Becker’s seminal Treatise on the Family. In his first article on marriage in the JPE in 1973, Becker gave more prominence to Demand & Supply [D&S] models than he later did in the Treatise. It appears that a similar movement away from D&S models is observed among later entrants. This is but one indication of Becker’s leadership in the economics of marriage in the period 1980-1993. Other indications are also discussed.
    Date: 2006–01
  4. By: Javier Ruiz-Castillo
    Abstract: This paper is a review of the literature on the ranking of centers of excellence in economics according to the papers published in specialized journals that have an anonymous evaluation procedure. There are two objectives: (1) to examine the evolution during the 1990’s of certain features of economic research, such as the gap that exists between the United States and the rest of the world, the dominant position of the United Kingdom within Europe, and the low productivity of economic scholars everywhere; and (2) to document the tremendous progress that Spanish research centers underwent during this period.
    Date: 2006–05
  5. By: Javier Ruiz-Castillo
    Abstract: En este trabajo se revisa la literatura sobre la ordenación de los centros de excelencia en economía en función de los artículos publicados en revistas especializadas que cuentan con un procedimiento de evaluación anónima. El objetivo es doble: (1) examinar la evolución durante los años 90 de algunos rasgos característicos de la investigación en economía, como son la brecha existente entre Estados Unidos y el resto del mundo, el predominio del Reino Unido dentro de Europa y la baja productividad de los economistas académicos en todos los ámbitos espaciales; y (2) documentar el enorme progreso experimentado por los centros de investigación españoles en esa época.
    Date: 2006–05
  6. By: L. Randall Wray
    Abstract: This paper briefly summarizes the orthodox approach to banking, finance, and money, and then points the way toward an alternative based on socioeconomics. It argues that the alternative approach is better fitted to not only the historical record, but also sheds more light on the nature of money in modern economies. In orthodoxy, money is something that reduces transaction costs, simplifying “economic life” by lubricating the market mechanism. Indeed, this is the unifying theme in virtually all orthodox approaches to banking, finance, and money: banks, financial instruments, and even money itself originate to improve market efficiency. However, the orthodox story of money's origins is rejected by most serious scholars outside the field of economics as historically inaccurate. Further, the orthodox sequence of “commodity (gold) money” to credit and fiat money does not square with the historical record. Finally, historians and anthropologists have long disputed the notion that markets originated spontaneously from some primeval propensity, rather emphasizing the important role played by authorities in creating and organizing markets. By contrast, this paper locates the origin of money in credit and debt relations, with the money of account emphasized as the numeraire in which credits and debts are measured. Importantly, the money of account is chosen by the state, and is enforced through denominating tax liabilities in the state’s own currency. What is the significance of this? It means that the state can take advantage of its role in the monetary system to mobilize resources in the public interest, without worrying about “availability of finance.” The alternative view of money leads to quite different conclusions regarding monetary and fiscal policy, and it rejects even long-run neutrality of money. It also generates interesting insights on exchange rate regimes and international payments systems.
    Date: 2006–07
  7. By: A. Batabyal
    Abstract: In recent times, ecologists and economists have drawn attention to the fact ecological and economic systems are jointly determined. Once this is recognized, it seems rather obvious that ecological-economic systems ought to be studied as one system. However, because this recognition has been very recent, a number of important issues in ecological economics remain poorly understood. Consequently, the purpose of this paper is to identify and discuss five of these outstanding issues.
    Keywords: Ecological-economic system, keystone species, natural capital, optimal management, persistence, resilience, substitutability
  8. By: Claudia Senik (Paris School of Economics, University Paris-IV Sorbonne, PSE and IZA Bonn)
    Abstract: This paper is dedicated to the empirical exploration of the welfare effect of expectations and progress per se. Using ten waves of the Russian Longitudinal Monitoring Survey, a panel household survey rich in subjective variables, the analysis suggests that for a given total stock of inter-temporal consumption, agents are more satisfied with an increasing time-profile of consumption: they seem to have a strong “taste for improvement”.
    Keywords: expectations, growth, subjective happiness, adaptation, panel data
    JEL: D31 D9 I31 Z13
    Date: 2006–07
  9. By: Uwe Sunde (IZA Bonn and University of Bonn)
    Abstract: Praktisch alle wirtschaftlich entwickelten Länder der Welt sind demokratisch. Sind demokratische Strukturen also kausal für wirtschaftlichen Wohlstand und Wachstum? Oder ist es vielmehr der wirtschaftliche Entwicklungsstand eines Landes, der eine Demokratie erst ermöglicht? Dieser Artikel gibt einen Überblick über die jüngere empirische Literatur zur Frage der Kausalität hinter der positiven Korrelation zwischen der Wahrscheinlichkeit demokratischer Strukturen und wirtschaftlichem Wohlstand und Wachstum. Die Evidenz lässt Zweifel an einem direkten kausalen Effekt in irgendeiner Richtung aufkommen. Allerdings deuten die Ergebnisse auf indirekte Effekte hin. So schaffen Demokratien offensichtlich bessere Rahmenbedingungen für die Akkumulation von Humankapital, insbesondere durch die Gewährleistung eines Rechtsstaats, und somit für wirtschaftliche Entwicklung. Andererseits scheint nicht Wohlstand an sich, sondern ein damit einhergehendes geeignetes gesellschaftliches Umfeld, wie etwa geringe Ungleichheit, demokratische Strukturen erst zu ermöglichen.
    Keywords: democracy, development, Lipset hypothesis, causal effect, growth, political institutions
    JEL: H10 N10 O10 E60
    Date: 2006–08
  10. By: D. Dickinson; J. Tiefenthaler
    Abstract: There has been growing interest within the economics discipline in the role of equity concerns in the distribution of resources. This paper presents empirical evidence from a series of controlled laboratory experiments where third-party decision-makers must allocate resources between two individuals. The experimental results indicate that subjects view a wide range of different allocations as the fair distribution of resources. However, regression analysis indicates that both treatment effects and a few demographic variables explain some of this variation in fairness concepts. Most significantly, decision-makers rewarded subjects who earned their favorable positions and the gender of the decision-maker was an important predictor of the allocation chosen.
    Keywords: Fairness, equity, experiments
    JEL: D63 C91 Z00
  11. By: Matteo Cervellati (University of Bologna, IAE Barcelona and IZA Bonn); Piergiuseppe Fortunato (University of Bologna); Uwe Sunde (IZA Bonn and University of Bonn)
    Abstract: We study the process of endogenous democratization from inefficient oligarchic systems in an economy where heterogeneous individuals can get involved in predation activities. The features of democracies are shown to be crucially related to the conditions under which democratization initially takes place. The political regime and the extent of redistribution implemented under it depend on the allocation of de facto political power across the different social groups. The cost of public enforcement of property rights depends on the extent of predation activities in the economy. The theory highlights the importance of inequality in natural resources and availability of human capital for endogenous democratic transitions. Multiple politico-economic equilibria can be sustained conditional on expectations about property rights enforcement. This generates history dependence. Democratic transitions supported by a large consensus serve as coordination device and lead to better protection of property and more stable political systems than democratic transitions imposed in conflictual environments. We test the novel predictions using available cross-country data. The link between the type of democratic transition and the outcomes under democracy is also investigated using novel data on constitutional principles. The findings support the theoretical predictions.
    Keywords: democratization, oligarchy, conflict, consensual democracy, inequality, commitment, constitutional principles
    JEL: H10 O20 N10
    Date: 2006–07

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