nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2010‒04‒17
twelve papers chosen by
Erik Thomson
University of Manitoba

  1. Economics and Rationality of organizations: an approach to the work of Herbert A. Simon By Estrada, Fernando
  2. New Monetarist Economics: models By Stephen D. Williamson; Randall Wright
  3. New Monetarist Economics: methods By Stephen D. Williamson; Randall Wright
  4. What is sustainability economics? By Stefan Baumgärtner; Martin F. Quaas
  5. Experimental Practices in Economics: Performativity and the Creation of Phenomena By Dorothea Kübler
  6. Sequences of Arbitrages By Victor Kozyakin; Brian O'Callaghan; Alexei Pokrovskii
  7. Economic Dynamics as a Succession of Equilibria: The Path Travelled by Morishima By Massimo Di Matteo
  8. Some aspects of random utility, extreme value theory and multinomial logit models By Andersson, Jonas; Ubøe, Jan
  9. Economics and Religion By Chiswick, Carmel U.
  10. Normative foundations of scarcity By Zaman, Asad
  11. Policy Making with Reputation Concerns By FU, Qiang; LI, Ming

  1. By: Estrada, Fernando
    Abstract: One of the main achievements of Herbert A. Simon in organizational theory is analytically evaluating the psychology of individual and collective behavior thus opening the ground for further research D. Kahneman, and T. Schelling. This article provides an assessment of the contributions of Simon's theory of organizations with special emphasis on the criterion of bounded rationality. It is interpreted Simon's criticism of the orthodox version of organizational bureaucracy and extends his analysis to the new institutional economics.
    Keywords: Economic theory; organizations; Herbert Simon; bounded rationality; Kahneman; Schelling; decision theory.
    JEL: B10 A1 B4 G3 B15 L2 D8 C72 D81 B1 C7 A10 G30 D0 D7 B41
    Date: 2010–04–01
  2. By: Stephen D. Williamson; Randall Wright
    Abstract: The purpose of this paper is to discuss some of the models used in New Monetarist Economics, which is our label for a body of recent work on money, banking, payments systems, asset markets, and related topics. A key principle in New Monetarism is that solid microfoundations are critical for understanding monetary issues. We survey recent papers on monetary theory, showing how they build on common foundations. We then lay out a tractable benchmark version of the model that allows us to address a variety of issues. We use it to analyze some classic economic topics, like the welfare effects of inflation, the relationship between money and capital accumulation, and the Phillips curve. We also extend the benchmark model in new ways, and show how it can be used to generate new insights in the study of payments, banking, and asset markets.
    Date: 2010
  3. By: Stephen D. Williamson; Randall Wright
    Abstract: This essay articulates the principles and practices of New Monetarism, our label for a recent body of work on money, banking, payments, and asset markets. We first discuss methodological issues distinguishing our approach from others: New Monetarism has something in common with Old Monetarism, but there are also important differences; it has little in common with Keynesianism. We describe the principles of these schools and contrast them with our approach. To show how it works, in practice, we build a benchmark New Monetarist model, and use it to study several issues, including the cost of inflation, liquidity and asset trading. We also develop a new model of banking.
    Date: 2010
  4. By: Stefan Baumgärtner (Department of Sustainability Sciences, Leuphana University of Lüneburg, Germany); Martin F. Quaas (Department of Economics, University of Kiel, Germany)
    Abstract: While economists have been contributing to the discussion of various aspects of sustainability for decades, it is just recently that the term “sustainability economics” was used explicitly in the ecological, environmental, and resource economics community. Yet, the contributions that use the term “sustainability economics” do not refer to any explicit definition of the term, and are not obviously joined by common or unifying characteristics, such as subject focus, methodology, or institutional background. The question thus arises: What is “sustainability economics”? In this essay, we make an attempt at systematically defining and delineating what “sustainability economics” could be in terms of its normative foundation, aims, subject matter, ontology, epistemology, and genuine research agenda.
    Keywords: economics, efficiency, epistemology, fairness, future, justice, human-nature-relationship, ontology, philosophy of science, sustainability, uncertainty
    JEL: Q0 D63 B0
    Date: 2009–09
  5. By: Dorothea Kübler
    Abstract: This contribution provides a brief overview and discussion of the role of experiments in economics. It is argued that economic experiments have convinced economists and the public of the existence of phenomena that have been outside the scope of economics. The success of these experiments is partly due to the performative nature of experiments. To develop this argument, examples of experiments are provided, and two different sets of criticisms of experiments are discussed. The paper concludes with a discussion of which questions economists should address and how experiments can be used to study policy-relevant questions. <br> <br> <i>ZUSAMMENFASSUNG - (Experimentelle Praktiken in der Ökonomie: Performativität und die Erzeugung neuer Phänomene) <br>Der Beitrag beschäftigt sich mit der Rolle von Experimenten in der Ökonomie. Es wird argumentiert, dass Experimente dazu in der Lage sind, sowohl Ökonomen als auch eine breitere Öffentlichkeit davon zu überzeugen, dass bestimmte Phänomene existieren, die vorher nicht als relevant für die Ökonomie angesehen oder gar nicht wahrgenommen wurden. Diese Wirkung von Experimenten beruht zu einem wichtigen Teil auf ihrer Performativität. Um dieses Argument zu entwickeln, werden Beispiele für Experimente gegeben, verschiedene Kritikpunkte an Experimenten diskutiert sowie die Frage aufgeworfen, was die Grenzen der Ökonomie sind und wie Experimente zur Beantwortung wirtschaftspolitischer Fragen eingesetzt werden können.<i>
    Date: 2010–01
  6. By: Victor Kozyakin; Brian O'Callaghan; Alexei Pokrovskii
    Abstract: The goal of this article is to understand some interesting features of sequences of arbitrage operations, which look relevant to various processes in Economics and Finances. In the second part of the paper, analysis of sequences of arbitrages is reformulated in the linear algebra terms. This admits an elegant geometric interpretation of the problems under consideration linked to the asynchronous systems theory. We feel that this interpretation will be useful in understanding more complicated, and more realistic, mathematical models in economics.
    Date: 2010–04
  7. By: Massimo Di Matteo
    Abstract: In the paper I bring to the attention of the economists and historians of economic thought the idea of economic dynamics that one can found in the first book by Morishima published in 1950 but totally overlooked. It has a great interest not only because there it appears for the first time the application of new mathematical concepts ("structural stability") but also because he pursues a way of dynamizing general equilibrium theory that has been neglected in the postwar developments that appears to have been inspired by Samuelson. The paper has three parts. In the first and second parts I outline the development of economic dynamics and its applications to general equilibrium elaborated by Morishima; in the third part a comparison between the prevailing idea of economic dynamics as originally put forward by Samuelson and that elaborated by Morishima is developed and discussed.
    Keywords: dynamic general equilibrium; comparative statics and dynamics; dynamic and structural stability.
    JEL: B31 B21 B49
    Date: 2009–12
  8. By: Andersson, Jonas (Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration); Ubøe, Jan (Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration)
    Abstract: In this paper we give a survey on some basic ideas related to random utility, extreme value theory and multinomial logit models. These ideas are well known within the field of spatial economics, but do not appear to be common knowledge to researchers in probability theory. The purpose of the paper is to try to bridge this gap.
    Keywords: Random utility theory; extreme value theory; multinomial logit models; entropy.
    JEL: C50
    Date: 2010–01–15
  9. By: Chiswick, Carmel U. (University of Illinois at Chicago)
    Abstract: This paper provides an overview of the relationship between economics and religion. It first considers the effects of economic incentives in the religious marketplace on consumers’ demand for "religion." It then shows how this demand affects religious institutions and generates a supply of religious goods and services. Other topics include the structure of this religious marketplace and the related "marketplace for ideas" in a religiously pluralistic society. Empirical evidence is summarized for the effects on selected economic behaviors of religious affiliation and intensity of belief or practice.
    Keywords: economics, religion, human capital
    JEL: Z12
    Date: 2010–04
  10. By: Zaman, Asad
    Abstract: The elevation of scarcity to the fundamental economic problem rests on some unstated normative assumptions. These include a political commitment to private property, a methodological commitment to not inquire about taste formation, and the idea that human welfare is roughly equivalent to preference satisfaction.
    Keywords: Scarcity; Normative Positive Distinction; Fact Value Distinction; private property; welfare; revealed preference
    JEL: B41
    Date: 2010–03
  11. By: FU, Qiang; LI, Ming
    Abstract: We study the policy choice of an incumbent politician who is concerned with the public's perception of his capability. The politician decides whether to maintain the status quo or to conduct a risky reform. The success of the reform critically depends on the ability of the politician in oce, which is privately known to the politician. The public observes both his policy choice and the outcome of the reform, and forms a posterior on the true ability of the politician. We show that politicians may engage in socially detrimental reform in order to be perceived as more capable. Conservative institutions that thwart reform may potentially improve social welfare.
    Keywords: Reform, Reputation, Ability, Conservatism
    JEL: C72 D72 D82
    Date: 2010
  12. By: Irene Sotiropoulou (Dept. of Economics - University of Crete)
    Abstract: The paper is an attempt to use the idea of reflexivity in order to organise and set �ready for answers� the ethical issues which have arisen at the very beginning of the field research (on a topic in the economics area) and have been anticipated for later stages of the research project. While at the beginning, the ethical issues were well covered under the appearance of �everyday� research practical problems to be resolved, the interaction with research participants revealed the theoretical depth that those same issue can have and the extend to which they might affect the research project itself. The paper as well as the issues are divided for analysis purposes, into three categories: the first deals with ethics concerning the terminology, vocabulary and narratives during or after field research; the second, discusses the ethical issues connected the interaction with participants, especially two issues: their acceptance to participate in the project and the information exchange; and the third part, discusses the cases where the researcher faces petitions for assistance in constructing something, that according to the research proposal, belongs to the object of the research.
    Keywords: ethics, field research, reflexivity
    Date: 2010–02–24

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