nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2008‒04‒21
nine papers chosen by
Erik Thomson
University of Chicago

  1. Causal Depth: Aspects of a Scientific Realist Approach to Causal Explanation contra Humean Empiricism By Khan, Haider
  2. Trevor Swan And The Neoclassical Growth Model By Robert W. Dimand; Barbara J. Spencer
  3. Choosing One’s Own Informal Institutions: On Hayek’s Critique of Keynes’s Immoralism By Berggren, Niclas
  4. Foundational Economic Theories for Political-Scientific Inter-Branch Studies By Yannis Karagiannis
  5. The Knowledge Economy/Society: The Latest Example of “Measurement Without Theory”? By Les Oxley; David Thorns; Paul Walker; Hong Wang
  6. The Cyclicity as Evolution Form of Economic Activities By UNGUREANU, Laura
  7. The two sides of command in organizations: reading Marx again By Bruno Tinel
  8. Play Money? Contemporary Perspectives on Monetary Sovereignty By Christoph Herrmann
  9. The Power of Positional Concerns By Benno Torgler; Sascha L. Schmidt; Bruno S. Frey

  1. By: Khan, Haider
    Abstract: The purpose of this note is to clarify how the idea of "causal depth" can play a role in finding the more "approximately true" explanation through causal comparisons. It is not an exhaustive treatment but rather focuses on a few aspects that may be the most critical in evaluating the explanatory strengths of a theory in the social sciences. It presents a general argument which is anti-Humean on the critical side and scientific realist on the positive side. It also elucidates how explanations in political economy and other social sciences can be judged by the scientific realist criterion of causal depth by an extensive example from research in the political economy of development. In this case, an "intentional" and methodologically individualist neoclassical explanation is contrasted with a "structural" dual-dual approach as rival theories purporting to explain the same set of phenomena.
    Keywords: Social Explanation; Causal Depth; Scientific Realism; Political Economy; Neoclassical Economics; Structuralism; Social Science Theories; Economic Models
    JEL: D02 D58 B00
    Date: 2008
  2. By: Robert W. Dimand; Barbara J. Spencer
    Abstract: Trevor Swan independently developed the neoclassical growth model, publishing Swan (1956) ten months later than Solow (1956), but analyzing technical progress before Solow (1957). These independent contributions are sometimes recognized by reference to the "Solow-Swan growth model", but more commonly reference is made only to the "Solow growth model". This paper examines the history of Swan's development of the growth model, the similarities and differences between the approaches of Swan and Solow and the reasons why Swan's contribution has been overshadowed. We draw on unpublished work to show that in 1950, Swan had set out a number of the basic ideas of his growth model in a verbal format. In 1956, Swan published only a simplified version of his model based on a Cobb-Douglas production function. Swan's original and more general model (circulated in July 1956), was published only posthumously in 2002. This reluctance to publish was consistent with his perhaps counterproductive modesty and perfectionism. His well known paper, "Longer run problems of the Balance of Payments" was circulated in 1955, eight years before publication in 1963. His pioneering work in 1945, developing the first macroeconomic model of the Australian economy, was published posthumously in 1989.
    JEL: B2 B3 B4 O41
    Date: 2008–04
  3. By: Berggren, Niclas (The Ratio Institute)
    Abstract: In the main, Hayek favored rules that apply equally to all and located such rules in tradition, beyond conscious construction. This led Hayek to attack Keynes’s immoralism, i.e. the position that one should be free to choose how to lead one’s life irrespective of the informal institutions in place. However, it is argued here that immoralism may be compatible with Hayek’s enterprise since Hayek misinterpreted Keynes, who did not advo-cate the dissolving of all informal rules for everybody. By avoiding this misinterpretation, immoralism can be seen as institutional experimentation at the margin, which Hayek himself favored.
    Keywords: Institutions; rules; traditions; morality; liberty; rule of law
    JEL: B25 O17 P48 Z13
    Date: 2008–04–14
  4. By: Yannis Karagiannis
    Abstract: Economic theories are increasingly popular in political science, and in particular in research on the relations between the legislative, the executive, and the judicial branches of government. Among these theories, principal-agent (´PA´) and transaction cost economics (´TCE´) feature particularly high in our research agenda. Yet, pushed by the view that "the content of ´science´ is primarily the methods and rules" (King et al. 1994: 9), and working with limited resources, political scientists have tended to neglect careful theorizing. PA and TCE are taken off-the-shelf without much prior scrutiny, and past conceptual mistakes are perpetuated. This paper aims at introducing and explaining the real PA, positive agency, TCE, and incomplete contracts theories for the purposes of political analysis. In a companion paper, I show the serious mistakes perpetuated by political scientists, and I argue that, faced with a choice between those four economic theories, we should place our bets on a revised version of TCE.
    Keywords: Theory of delegation, political science, principal-agent models, transaction costs economics
    Date: 2007–05–04
  5. By: Les Oxley (University of Canterbury); David Thorns; Paul Walker; Hong Wang
    Abstract: The world has embraced a set of concepts (knowledge driven growth) which are seen as the ‘core of future growth and wellbeing’ without any commonly agreed notion of what they are, how they might be measured, and crucially therefore, how they actually do (or might) affect economic growth and social wellbeing. The theory of how the mechanism works lacks important detail.
    Keywords: Knowledge Economy; Knowledge Society; Human Capital; Theory of the Firm
    JEL: D8 D21 L22 L23 O31
    Date: 2008–02–26
  6. By: UNGUREANU, Laura
    Abstract: The persistent of cycles was remark even to the 19th century economists and the rigorous theory of fluctuation or bussines cycle are take form past century. In the analyses dynamics macroeconomic area is can observe a big variety of method and techniques for research fluctuates from economy and financial date. A complex way for evidence the economic cycles is to determine limits cycles for the dynamical system which model the economic phenomenon.
    Keywords: cyclic evolution; dynamical modeling; nonliniarity
    JEL: C53 E32
    Date: 2008–04–17
  7. By: Bruno Tinel (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I)
    Abstract: In his chapter 13 of the Capital, Marx shows that cooperation involves coordination whatever the mode of production is. In his opinion, command in capitalist production has two sides: coordination and exploitation. The main features of command in a democratic organization of production are briefly drawn through this analysis.
    Keywords: democratic organization ; collective labourer ; command ; coordination ; cooperation ; subjection of labour
    Date: 2007–10
  8. By: Christoph Herrmann
    Abstract: Money has always been a difficult and complex concept and the views about what money actually is could hardly be more diverse. This is all the more true in the times of completely manipulated irredeemable paper currencies, the functioning of which is based almost completely on the extent to which people believe in its trustworthiness. The final abolition of Gold as a universal standard of currencies in the early 1970s at first glance seems to have strengthened the grip of governments on money. Nevertheless, it is often argued that "national currencies" are under threat. According to this view, "monetary sovereignty" is waning, as is sovereignty as a whole. The present paper takes a different view. It argues that "monetary sovereignty" understood as a legal concept remains intact and is not even significantly limited by obligations under public international law. This leaves governments significant leeway in taking decisions regarding the setup of their monetary regime ("sovereignty games") and empirical evidence shows the large number of different options that are actually chosen.
    Keywords: Sovereignty, Monetary Sovereignty, International Monetary Relations, Monetary Policy, Money
    Date: 2007–11–09
  9. By: Benno Torgler; Sascha L. Schmidt; Bruno S. Frey
    Abstract: People care a great deal about their relative economic position and not solely about their absolute economic position. However, behavioral evidence is rare. This paper provides evidence on how the relative income position affects professional sports performances. Our analysis suggests that if a player’s salary is below the average and this difference increases, his performance worsens. Moreover, the larger the income differences, the stronger positional concern effects are observable. We also find that the more the players are integrated, the more evident a relative income effect is. Finally, we find that positional effects are stronger among high performing teams.
    Keywords: Relative income; positional concerns; organizational justice; envy; social comparison; relative derivation; equity theory; prospect theory; loss aversion; performance
    Date: 2008–04

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