nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2007‒02‒17
seven papers chosen by
Erik Thomson
University of Chicago

  1. Appraising Schumpeter's 'Essence' after 100 Years: From Walrasian Economics to Evolutionary Economics By Esben Sloth Andersen
  2. "A Theory of Deep Democracy and Economic Justice in the Age of Postmodernism" By Haider A. Khan
  3. Perspectives from the Happiness Literature and the Role of New Instruments for Policy Analysis By Bernard M.S. van Praag
  4. Organization, evolution, cognition and dynamic capabilities By Nooteboom,Bart
  5. Beyond economic criteria: A humanistic approach to organizational survival By Rosanas, Josep M.
  6. The Jigsaw Puzzle of Economical Research in the Colombian Caribbean: A Balance from the Past Decade (1996-2005) (in Spanish) By Toro González, Daniel; Espinosa Espinosa, Aarón; Quintero Otero, Jorge
  7. Intellectual evolution of strategic management and its relationship with ethics and social responsibility By Melé, Domenec; Guillen, Manuel

  1. By: Esben Sloth Andersen
    Abstract: Schumpeter’s unique type of evolutionary analysis can hardly be understood unless we recognise that he developed it in relation to a study of the strength and weaknesses of the Walrasian form of Neoclassical Economics. This development was largely performed in his first book Wesen und Hauptinhalt der theoretischen Nationalökonomie. This German-language book - which in English might be called ‘Essence and Scope of Theoretical Economics’ - was published a century ago (in 1908). Different readings of Wesen provide many clues about the emergence and structure of Schumpeter’s programme for teaching and research. This programme included a modernisation of static economic analysis but he concentrated on the difficult extension of economic analysis to cover economic evolution. Schumpeter thought that this extension required a break with basic neoclassical assumptions, but he tried to avoid controversy by presenting it as only requiring the introduction of innovative entrepreneurs into the set-up of the Walrasian System. Actually, he could easily define the function of his type of entrepreneurs in this manner, but the analysis of the overall process of evolution required a radical reinterpretation of the system of general economic equilibrium. He thus made clear that he could not accept the standard interpretation of the quick Walrasian process of adaptation (tâtonnement). Instead, he saw the innovative transformation of routine behaviour as a relatively slow and conflict-ridden process. This reinterpretation helped him to sketch out his theory of economic business cycles as reflecting the waveform process of economic evolution under capitalism.
    Keywords: Economic statics; evolutionary dynamics; business cycles; Joseph A. Schumpeter; Léon Walras
    JEL: B31 E30 O31
    Date: 2006
  2. By: Haider A. Khan (GSIS , University of Denver)
    Abstract: The main purpose of this paper is to offer a somewhat novel theory of deep democracy and economic justice. Part of the novelty consists in considering radical uncertainty and indeterminacy under postmodern conditions. I claim that even under such conditions a plausible theory of deep democracy and economic justice can make sense. The theory of deep democracy presented here makes a distinction between formal aspects of democracy and the deeper structural aspects. In order for democracy to be deep, democratic practices have to become institutionalized in such a way that they become part of normal life ina democratic society. In this sense, ontologically, deep democracy overlaps with Barber's (1984) idea of "strong" democracy. There are, however, epistemological differences as well as differences of emphasis, particularly in the economic spere. I have tried to consider the postmodernist position with regards to democracy and economic justice by paying careful attention to the arguments of leading postmodernists. Barring a nihilism that rules out arguments entirely, such a procedure seems reasonable. Following this procedure, Lyotard's characterization of the discourse on morality and justice as phrase-regimes has been shown to lead to an ethical impasse. His appeal to the Kantian sublime, in this context, would seem to be a category mistake. The aesthetic category of sublime does not fit the requirements of moral judgments even in Kantian terms. Epistemologically, the postmodern dilemma arises from a correct critique of metaphysics and transcendentalism. However, the critique is partial and negative. It is partial in the sense that it does not take the challenge of Kant to develop normativity seriously enough to explore alternatives as Hegel did. It, therefore, pursues entirely the negative critical path leading to thoroughgoing skepticism and nihilism. Derrida's belated attempts to rescue philosophy from a linguistic nihilism may succeed. But it still falls far short of offering a positive account of normativity. A critical overcoming of modernism simply cannot be found in the postmodern turn. I have offered as an alternative to natural law and transcendental norms an account of Hegel's explorations. As Winfield and others have pointed out, this approach is also anti-foundational. However, by following the rational demands of self-determination, it is possible to break out of the vicious circle of skepticism. Instead a progressive structure starting with the minimum structure of freedom as self-determination can be built up. Following this alternative offers a way of exploring deep democracy and economic justice. A concrete set of institutions consistent with the development of self-determination can be seen as necessary for the idea of economic justice to have meaning. In the spheres of production, distribution, exchange, law and contracts among others, the development of appropriate economic institutions allowing this inter-subjective idea of freedom to unfold becomes the thematic development of economic justice. An important problem in this context is the coherence of the concept of the moral subject. By carefully considering poststructuralist psychoanalytical theory of Lacan and others a dynamically oriented approach to the question of the subject becomes possible. Pre-Freudian thinkers such as Hegel or Marx did not see the formation of the individual in all its deeply problematic aspects. However, the "speaking subject," though not innocent (as Helene Cixous wittily put it), is nevertheless capable of agency under specific social and economic conditions. A continuum of subjectivity ending with the fully liberated individual offers various possible levels of moral agency. In an economically and socially unjust setting radical analytic and social interventions will be necessary for these possibilities to materialize. Deep Democrfacy and economic justice, therefore, can be presented as a coherent set of positive requirements. It is part and parcel of the need for rational autonomy in our world. Reasonably enough, even if we choose to call such a world postmodern, a discourse on deep democracy and economic justice is both necessary and possible. It is encouraging to think that such discourses are not just phrase-regimes.
    Date: 2007–02
  3. By: Bernard M.S. van Praag (SCHOLAR, University of Amsterdam, DIW Berlin, CESifo and IZA)
    Abstract: After having been ignored for a long time by economists, happiness is becoming an object of serious research in 21st century economics. In Section 2 we sketch the present status of happiness economics. In Section 3 we consider the practical applicability of happiness economics, retaining the assumption of ordinal individual utilities. In Section 4 we introduce a cardinal utility concept, which seems to us the natural consequence of the happiness economics methodology. In Section 5 we sketch how this approach can lead to a normative approach to policy problems that is admissible from a positivist point of view. Section 6 concludes.
    Keywords: happiness economics, subjective well-being, equivalence scales, economic policy
    JEL: B21 B41 D63 I31 I38
    Date: 2007–01
  4. By: Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: Using insights from 'embodied cognition' and a resulting 'cognitive theory of the firm', I aim to contribute to the further development of evolutionary theory of organizations, in the specification of organizations as 'interactors' that carry organizational competencies as 'replicators', within industries as 'populations'. Especially, I analyze how, if at all, 'dynamic capabilities' can be fitted into evolutionary theory. I propose that the prime purpose of an organization is to serve as a cognitive 'focusing device'. Here, cognition has a wide meaning, including perception, interpretation, sense making, and value judgements. I analyse how this yields organizations as cohesive wholes, and differences within and between industries. I propose the following sources of variation: replication in communication, novel combinations of existing knowledge, and a path of discovery by which exploitation leads to exploration. These yield a proposal for dynamic capabilities. I discuss in what sense, and to what extent these sources of variation are 'blind', as postulated in evolutionary theory.
    Keywords: evolutionary economics;organization;cognition;dynamic capabilities
    JEL: D21 L22 O31 B52
    Date: 2007
  5. By: Rosanas, Josep M. (IESE Business School)
    Abstract: There are many, often mutually inconsistent, theories about organizations that explain organizational phenomena to the same, limited extent. Most of them ignore the ethical dimension completely. In this paper we propose the basic principles for a theory of decision-making in organizations that has ethics at its core. This theory is based on the work of Juan Antonio Pérez López (1991, 1993) and is essentially a humanistic view of the interrelationships between people and their implications for organizational decision-making. First, we show how, in any interrelationship between two people, what each person learns is crucial to the future of the relationship. We then consider the different aspects of what each person learns. Second, we apply the preceding analysis to the organizational context, as a guide to organizational decision making, and show how any decision in an organization needs to be analyzed in terms of three criteria: short-run effectiveness, development of distinctive competence, and unity and identification of employees with the organization.
    Keywords: business ethics; ethical foundations of organization; trust; management theory; learning;
    Date: 2006–10–13
  6. By: Toro González, Daniel; Espinosa Espinosa, Aarón; Quintero Otero, Jorge
    Abstract: In this article it is realized an inventory of the production of academic and scientific articles about economics in Colombian Caribbean Coast in the last 10 years. The document analyses the scientific production in economics realized in the Caribbean Coast and about the Caribbean Coast, in order to establish a map of the regional economic research and realize an approximation to the accumulated production and the general tendencies of the publications. To accomplish this goal, it was used the JEL (Journal of Economic Literature) Classification System as a platform for completing the puzzle by topics. Among other aspects, the study shows that three non-university institutions are responsible for the 67% of the regional academic production about economics. 40% of total considered production was realized by the 10% of the Caribbean Coast researches. 51% of the JEL Classifications have not being approached by region researches. Finally, there are few institutions with a systemic and deep job in a specific topic, which is why there are many possibilities of specialization for institution that have not defined its research lines and want to be pioneers in some economic analysis topic.
    Keywords: Regional Economy; Colombia; Caribbean coast; scientific article
    JEL: B00 A10 R10
    Date: 2005–12
  7. By: Melé, Domenec (IESE Business School); Guillen, Manuel (University of Valencia)
    Abstract: The main purpose here is to present an overview of the historical development of strategic management, through a critical review of the most relevant theoretical proposals, and to consider its links to ethics and corporate social responsibilities. From the very beginning of strategic management thought attempts have been made to fuse ethical aspects such as values of senior management or social values or social expectations to strategic management. More recently the stakeholder view of the firm has permitted the introduction of ethical theories into strategic management, and the resources-based view of the firm has lead to the consideration of competences, including moral virtues. Here it is argued that in spite of some advances, the integration of ethics into strategic management is not yet entirely satisfactory. Thus, it is suggested that new directions to focus the integration of ethics and strategic management are necessary.
    Keywords: Strategic management; Integrating ethics in management; Business ethics; Corporate social responsibility;
    Date: 2006–10–15

This nep-hpe issue is ©2007 by Erik Thomson. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.