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on History and Philosophy of Economics |
| By: | John H. Munro |
| Abstract: | Entrepreneurship, by its very essence, concerns the theory of the firm – the individual enterprise – which in turn is the essential core of micro-economics. A major theme of this study, however, is to demonstrate the interaction of micro- and macro-economic phenomena: to show how such firms or enterprises, and entrepreneurship itself, were often shaped by, and often helped shape, such macro-economic forces as demographic changes, monetary changes, price changes – in terms of both deflation and inflation – long distance trade, overseas exploration and expansion (colonialism), and indeed related changes in social institutions and socio-cultural values that were also influenced by such macro-economic changes. One generalization about macro-economic changes involving inflations and deflations has both general and considerable importance in the history of European business enterprises and entrepreneurship itself: for long-term inflations (when moderate) tend to cheapen or reduce the relative factor costs of labour, land (rent contracts), and capital (fixed interest rates in loan contracts). Similarly, long term deflations tend, in reverse fashion, in increase the real or relative factor costs of labour, land, and capital, especially with pronounced wage-stickiness, and related ‘stickiness’ in leasehold rent contracts (and more so with customary tenures), and with loan contracts -- even if the long-term trends in real interest rates was falling over this long period. At the same time, both inflations and deflations are accompanied by changes in the relative prices of key industrial inputs. The key question to be posed is this: how did entrepreneurs respond to such changes in their factor costs, both short term and long term? This study commences by demonstrating how deflation in mid-15th century Europe, in increasing the purchasing power of silver, provided the stimulus for two major technological innovations in silver-mining and smelting that led to the South German silver-copper mining boom of 1460-1540, which also meant major changes in commercial-industrial entrepreneurship and in industrial scales. That mining boom in turn laid the foundations for the 130 year inflation of the Price Revolution (1520-1650) – an inflation further fostered by a financial revolution in credit and banking institutions (from the 1520s), and then further fuelled by the influx of Spanish-American silver.. The heart of this study is on the role of inflation, and associated macro-economic changes, in producing the roots of modern capitalist entrepreneurship, during what is often called Tawney’s Century (1540-1640). We begin, however, with two famous related theses: Hamilton’s thesis of ‘Profit Inflation’ (in which wages lag behind consumer prices), a wrongly-constructed thesis that endures only because Keynes endorsed it; and Nef’s thesis of the ‘Tudor Stuart industrial revolution’ – a much ridiculed response to Hamilton – whose merit lies in revealing the capitalist entrepreneurship, major technological changes, and changes in industrial scale that resulted from the substitution of coal – the hear of modern industrialization – for every more costly wood charcoal. Tawney’s three theses themselves concern the origins of modern agrarian capitalist, the related ‘Rise of the Gentry’ debate (on the role of inflation in shifting land ownership from the aristocracy to the capitalist gentry landowners), and the Weber-Tawney thesis on Religion (Protestantism) and the Rise of Capitalism, which, I endeavour to show has its real relevance only from the late 17th century. Associated with the Price Revolution era is the Age of Overseas Expansion (involving one of the most momentous technological and entrepreneurial change of the early modern era: the development of the Full Rigged Atlantic ship, with heavy artillery). England joined that overseas commercial-colonial race rather late, in the 1550s, but in doing developed the foundations of modern capitalism in creating the joint stock company. The study ends with the following era of monetary scarcity and deflation provided another macro-economic challenge whose response was revolutionary changes in banking and financial institutions – i.e., in financial-commercial entrepreneurship. It also fostered the growth and spread of rent-seeking Mercantilist philosophies that also influenced the character of early-modern capitalist entrepreneurship. |
| Keywords: | Entrepreneurship; Inflation; Deflation; Factor Costs; Technological Innovations; Minind and Metallurgy; Coal-Burning Industries; Joint-Stock Company |
| JEL: | E31 E40 F10 G20 G21 J10 J30 L10 L71 L72 N13 N23 N33 N83 |
| Date: | 2006–10–09 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-257&r=hpe |
| By: | van den Hauwe, Ludwig |
| Abstract: | Criticizing and commenting upon a questionable thesis of Hayek biographer Hans Jörg Hennecke, the author of this article argues that Hayek´s methodological outlook at the time he engaged in business cycle research was actually closer to praxeological apriorism than to Popperian falsificationism. A consideration of the Duhem thesis highlights the fact that even from a mainstream methodological perspective falsificationism is more problematic than is often realized. Even if the praxeological and mainstream lines of argumentation reject the Popperian emphasis on falsification for different reasons and from a different background, the prospects for falsificationism in economic methodology seem rather bleak. |
| Keywords: | General Methodology; Austrian Methodology; Falsificationism; Popper; Hayek; Duhem; Duhemian Argument; Testing of Theories; Meaning and Interpretation of Econometric Results; Correlation and Causality; |
| JEL: | B53 A12 C10 B23 E32 B20 B40 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:322&r=hpe |
| By: | Martin Beckenkamp (Max Planck Institute for Research on Collective Goods, Bonn) |
| Abstract: | The puzzle about collective actors is in the focus of this contribution. The first section enters into the question of the adequateness and inadequateness of reductionist explanations for the description of entities. The considerations in this part do not draw on systems and hence not on principles of self-organisation, because this concept necessitates a systemic view. In other words, the first section discusses reductionism and holism on a very general level. The scope of these arguments goes far beyond self-organising systems. Pragmatically, these arguments will be discussed within the domain of corporative actors. Emergence is a concept embedded in system theory. Therefore, in the second part the previous general considerations about holism are integrated with respect to the concept “emergence”. In order to close the argument by exactly characterising self-organising systems and giving the conceptual link between self-organisation and emergence – which is done in the section four – the third section generally conceptualises systems. This conceptualisation is independent of whether these systems are self-organising or not. Feedback loops are specified as an essential component of systems. They establish the essential precondition of system-theoretic models where causes may also be effects and vice versa. System-theory is essential for dynamic models like ecological models and network thinking. In the fourth part mathematical chaos-theory bridges the gap between the presentation of systems in general and the constricted consideration of self-organising systems. The capability to behave or react chaotically is a necessary precondition of self-organisation. Nevertheless, there are striking differences in the answers given from theories of self-organisation in biology, economics or sociology on the question “What makes the whole more than the sum of its parts?” The fracture seems particularly salient at the borderline between formal-mathematical sciences like natural sciences including economy and other social sciences like sociology, for instance in the understanding and conceptualisation of “chaos” or “complexity”. Sometimes it creates the impression that originally well defined concepts from mathematics and natural science are metaphorically used in social sciences. This is a further reason why this paper concentrates on conceptualisations of self-organisation from natural sciences. The fifth part integrates the arguments from a system-theoretic point of view given in the three previous sections with respect to collective and corporative actors. Due to his prominence all five sections sometimes deal with the sociological system theory by Niklas Luhmann, especially in those parts with rigorous and important differences between his conception and the view given in this text. Despite Luhmann’s undoubted prominence in sociology, the present text strives for a more analytical and formal understanding of social systems and tries to find a base for another methodological approach. |
| Date: | 2006–07 |
| URL: | http://d.repec.org/n?u=RePEc:mpg:wpaper:2006_14&r=hpe |
| By: | Alain Béraud (THEMA - Théorie économique, Modélisation et Applications - [CNRS : UMR8184] - [Université de Cergy Pontoise]) |
| Abstract: | Les ingénieurs économistes français avaient accueilli avec beaucoup de réticences l'œuvre de Walras. Ils ne pensaient pas que l'emploi des mathématiques puisse constituer une méthode normale même en économie politique pure. Progressivement leurs réticences s'estompèrent quand ils reconnurent le rôle crucial de l'interdépendance dans l'analyse des phénomènes économiques. La théorie de l'équilibre général s'imposa alors comme le cadre nécessaire de référence. Dans cette évolution, la publication en 1928 de L'économique rationnelle marque une étape importante non seulement parce que Divisia propose, dans cet ouvrage, un nouvel exposé de la théorie de l'équilibre général mais parce qu'il met en évidence les difficultés que soulèvent les analyses que faisait Walras des choix intertemporels et de la formation des prix monétaires. C'est en s'appuyant sur ces critiques et sur les analyses de Fisher et de Pareto qu'Allais proposa, dans son Traité d'économie pure, un nouveau modèle d'équilibre général qui prend en compte de façon systématique le caractère temporel des phénomènes économiques. C'est à juste raison que ce modèle fut qualifié de néo-walrasien car c'est bien du modèle que Walras avait élaboré dans les Éléments d'économie politique pure que s'inspire Allais pour construire sa propre théorie de l'équilibre économique. |
| Keywords: | Walras, Divisia, Colson, Rueff, Roy, Allais, Théorie de l'équilibre général, histoire de la pensée économique |
| Date: | 2006–10–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00104574_v1&r=hpe |
| By: | Crowley , Patrick (College of Business, Texas A&M University) |
| Abstract: | Wavelet analysis, although used extensively in disciplines such as signal processing, engineering, medical sciences, physics and astronomy, has not yet fully entered the economics discipline. In this discussion paper, wavelet analysis is introduced in an intuitive manner, and the existing economics and finance literature that utilises wavelets is explored. Extensive examples of exploratory wavelet analysis are given, many using Canadian, US and Finnish industrial production data. Finally, potential future applications for wavelet analysis in economics are also discussed and explored. |
| Keywords: | statistical methodology; multiresolution analysis; wavelets; business cycles; economic growth |
| JEL: | C19 C65 C87 E32 |
| Date: | 2005–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bofrdp:2005_001&r=hpe |
| By: | Alfred Schüller (Faculty of Business Administration and Economics, Philipps Universitaet Marburg) |
| Abstract: | At the turn of the 18th century Saint-Simon und his disciples, the Saint-Simonists, developed ideas about centrally planned and directed humane societies. These ideas are still influential and are proposed by some as guiding principles for the development of an institutional structure for a peaceful united Europe. According to the constructional interventionist ideas of the Saint-Simonists, classical liberal philosophies are the root cause of many problems in society. They therefore disapprove of liberal methods of integration which rely on competitive markets such as the one successfully employed by the German Customs Union in the 19th century. Emanating from France, the ideas of the Saint-Simonists on integration have been disseminated in a wide range of variants. However, experiences of the 20th century demonstrate the disastrous failure of the Saint-Simonist’ concepts of integration. So far no successful alternatives to liberal methods of integration which rely on competitive markets have been developed. Never-the-less, since the second world war, French interventions, in particular, have allowed Saint-Simonist’ ideals to influence the process of European Integration. While the dominance of liberal methods of integration via competitive markets was initially not challenged, the wide reaching possibilities for market interventions contained in the Maastricht treaties give a clear indication of the resurgence and spread of influence of Saint-Simonist ideals since the 1990s. Should these become dominant the multicultural community of the EU member countries will be at risk to suffer from increasing in political bureaucracy and the loss of competitive performance incentives and entrepreneurial freedom. The EU would thereby mutate to an institution described by Wilhelm Röpke as a “roof without a house”. This article calls for a systematic readjustment of EU policies in favour of liberal methods of integration, which should reaffirm non-discriminatory competition as the leading principle of EU integration. This aims at ensuring that the EU will remain an attractive community for its citizens in the long-term |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:mar:volksw:200613&r=hpe |
| By: | Naoki Yoshihara |
| Abstract: | In this paper, we reexamine the mathematical analysis of Marxian exploitation theory. First, we reexamine the validity of the two types of Marxian labor exploitation, Morishima's (1974) type and Roemer's type (1982), in the argument of Fundamental Marxian Theorem (FMT). We show that the FMT does not hold true if we adopt the Roemer exploitation, and equilibrium notions are the reproducible solution [Roemer (1980)]. Also, we show that the FMT does not hold true for the Morishima exploitation if there exist heterogeneous demand functions among workers. Second, we reexamine the Class- Exploitation Correspondence Principle (CECP) [Roemer (1982)]. We show that the CECP does not hold true in the general convex cone economy even if we adopt the Roemer exploitation. Finally, we propose a new definition of Marxian labor exploitation, and show that all of the above difficulties can be resolved under this new definition. |
| Keywords: | reproducible solutions; the Fundamental Marxian Theorem; the Class-Exploitation Correspondence Principle; the Roemer (1982) definition of labor exploitation; the Morishima (1974) definition of labor exploitation |
| JEL: | B24 B51 D31 D46 |
| Date: | 2006–05 |
| URL: | http://d.repec.org/n?u=RePEc:hit:hituec:a481&r=hpe |
| By: | Eric Jones |
| Abstract: | This is the text of the Chancellor Dunning Trust Lecture as it was delivered on Oct. 4, 2006. |
| Keywords: | Culture, Nationalism, Protectionism, Collectivism |
| JEL: | A13 F10 |
| Date: | 2006–10 |
| URL: | http://d.repec.org/n?u=RePEc:qed:wpaper:1093&r=hpe |
| By: | Piñeiro, Erik |
| Date: | 2005–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhb:pinkwp:7&r=hpe |