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on History and Philosophy of Economics |
| By: | Bjerkholt, Olav (Dept. of Economics, University of Oslo); Qin, Duo (Department of Economics, Queen Mary, University of London) |
| Abstract: | This paper is prepared for the forthcoming publication of Frisch’s 1930 Yale lecture notes, A Dynamic Approach to Economic Theory: The Yale Lectures of Ragnar Frisch (details at: http://www.routledgeeconomics.com/books/A-Dynamic-Approach-to-Economic-Theory-isbn9780415564090). As the lecture series was given just as the Econometric Society was founded in 1930. We provide as background, a blow-by-blow story of how the Econometric Society got founded with emphasis on Frisch’s role. We then outline how the Yale lecture notes came into being, closely connected to Frisch’s econometric work at the time. We comment upon the lectures, relating them to Frisch’s later works and, more important, to subsequent developments in economics and econometrics. |
| Keywords: | history; econometrics |
| JEL: | B23 |
| Date: | 2010–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2010_005&r=hpe |
| By: | Kakarot-Handtke, Egmont |
| Abstract: | Standard economic models are based on an axiom set that epitomizes the fundamental behavioral assumptions. The present treatise moves these assumptions from the foreground to the background. The suggested change of perspective is guided by the question: what is the minimum set of foundational propositions for a consistent reconstruction of the evolving money economy? We start with four non-behavioral axioms. Subsequently their logical and factual implications are explored and the building blocks of the general axiomatic model are determined. The switch of the unifying principle resolves the profit conundrum – 'one of the most convoluted and muddled areas in economy theory'. Hence structural axiomatization has ramifications on larger parts of standard economics. By virtue of the axiom set evolution supersedes equilibrium as central organizing idea. |
| Keywords: | Framework of Concepts; Structure-centric; Axiom Set; Propensity Function; General Axiomatic Model; Stochastic Processes;Evolutionary Economics; Evolving Money Economy; e·Economics |
| JEL: | E00 |
| Date: | 2010–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24331&r=hpe |
| By: | Herrmann-Pillath, Carsten |
| Abstract: | Recently, the maximum entropy principle has been applied to explain the evolution of complex non-equilibrium systems, such as the Earth system. I argue that it can also be fruitfully deployed to reconsider the classical treatment of entropy in economics by Georgescu-Roegen, if the growth of knowledge is seen as a physical process. Relying on central categories of Peirce's theory of signs, I follow the lines of a naturalistic evolutionary epistemology. In this framework, the three principles of Maximum Entropy (Jaynes), Maximum Power (Lotka) and Maximum Entropy Production can be arranged in a way such that evolution can be conceived as a process that manifests the physical tendency to maximize information generation and information capacity. This implies that the growth of knowledge is the dual of the process of entropy production. This theory matches with recent empirical research showing that economic growth can be tracked by measures of the throughput of useful work, mediated by the thermodynamic efficiency of the conversion of exergy into useful work. -- |
| Keywords: | Peirce,Georgescu-Roegen,maximum entropy,maximum power,natural selection,semeiosis,physical inference devices,economic growth,useful work |
| JEL: | B52 D80 Q57 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fsfmwp:146&r=hpe |
| By: | Evers, Hans-Dieter; Yusoff, Anis; Shamsul, A.BB. |
| Abstract: | Biology and Anthropology/Sociology have dealt with issues of diversity for a long time, developing different concepts, theories and methods. In recent years there has been, if not a convergence, but at least a recognition that problems in nature and in society are interrelated. This paper attempts to use concepts and methods of biodiversity research and test their applicability for a study of ethnic relations. It is noted that the preservation of biodiversity ranks high on the agenda of researchers and politicians, whereas ethnic diversity is often associated with unrest, conflict and economic decline. We try to reverse this tendency by emphasizing social cohesion and the social and economic value of ethnic diversity. An “ethnic diversity index” is proposed and used in the analysis of Malaysia’s plural society. This index is based on Simpson’s diversity index, commonly used in biodiversity research. Further research on the interrelation of bio- and ethnic diversity is advocated. |
| Keywords: | Biodiversity; ethnic diversity; research methods; pluralism; ethnic conflict; cohesion; ethnoscape; Malaysia |
| JEL: | C10 D63 C43 C88 J15 A14 |
| Date: | 2010–08–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24429&r=hpe |
| By: | Eenkhoorn, P.; Einmahl, J.H.J. (Tilburg University, Center for Economic Research) |
| Abstract: | The famous political philosopher Hannah Arendt develops several arguments why truthfulness cannot be counted among the political virtues. This article shows that similar arguments apply to lying in business. Based on Hannah Arendt’s theory, we distinguish five reasons why lying is a structural temptation in business: business is about action to change the world and therefore businessmen need the capacity to deny current reality; commerce requires successful image-making and liars have the advantage to come up with plausible stories; business communication is more often about opinions than about facts, giving leeway to ignore uncomfortable signals; business increasingly makes use of plans and models, but these techniques foster inflexibility in acknowledging the real facts; businessmen fall easily prey to self-deception, because one needs to act as if the vision already materializes. The theory is illustrated by a case study of Landis that grew from a relative insignificant into a large organization within a short period of time, but ended with outright lies and bankruptcy. |
| Keywords: | Lying;deceit in business;Hannah Arendt;image-making;self-deception;accounting fraud;politics and business;Landis |
| JEL: | D89 M14 M41 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:201075&r=hpe |
| By: | Stefan Ambec; Mark A. Cohen; Stewart Elgie; Paul Lanoie |
| Abstract: | Twenty years ago, Harvard Business School economist and strategy professor Michael Porter stood conventional wisdom about the impact of environmental regulation on business on its head by declaring that well designed regulation could actually enhance competitiveness. The traditional view of environmental regulation held by virtually all economists until that time was that requiring firms to reduce an externality like pollution necessarily restricted their options and thus by definition reduced their profits. After all, if there are profitable opportunities to reduce pollution, profit maximizing firms would already be taking advantage of those opportunities. Over the past 20 years, much has been written about what has since become known simply as the Porter Hypothesis (“PH”). Yet, even today, there is conflicting evidence, alternative theories that might explain the PH, and oftentimes a misunderstanding of what the PH does and does not say. This paper provides an overview of the key theoretical and empirical insights on the PH to date, draw policy implications from these insights, and sketches out major research themes going forward. <P>Il y a bientôt vingt ans, Michael Porter, économiste et professeur de stratégie de la Harvard Business School, a remis en question le paradigme généralement accepté quant à l’impact des réglementations environnementales sur la performance d’affaires, en affirmant que des politiques environnementales bien conçues pouvaient en fait améliorer la compétitivité des entreprises. Jusqu’alors, le point de vue dominant, accepté par la quasi-totalité des économistes, stipulait que d’imposer aux entreprises de réduire une externalité comme la pollution réduisait nécessairement les options à leur disposition et, par définition, leurs profits. Après tout, s’il y a des opportunités profitables de réduire la pollution, les firmes qui maximisent leurs profits auraient dû les identifier par elles-mêmes. Depuis 20 ans, beaucoup de choses ont été écrites sur ce qu’il est convenu d’appeler l’Hypothèse de Porter. Aujourd’hui, il y a diverses théories pour expliquer l’Hypothèse de Porter. Les résultats empiriques ne sont pas concluants et il subsiste une certaine confusion sur ce que dit et ne dit pas l’Hypothèse de Porter. Ce texte présente un survol des grands enjeux théoriques et empiriques entourant l’Hypothèse de Porter, en tire les grandes implications en termes de politiques publiques et propose des avenues de recherche pour le futur. |
| Keywords: | Porter Hypothesis, environmental policy, innovation, performance , Hypothèse de Porter, politiques environnementales, innovation, performance |
| Date: | 2010–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2010s-29&r=hpe |
| By: | Bjerkholt, Olav (Dept. of Economics, University of Oslo) |
| Abstract: | The article presents an exchange of letters between Jakob Marschak and Trygve Haavelmo in May-July 1943. Marschak had from the beginning of 1943 become the research director of Cowles Commission at the University of Chicago. Trygve Haavelmo, who at the time worked for the Norwegian Shipping and Trade Mission in New York, had just published the article on the statistical implications of simultaneous equations, which would become his most quoted work. The content and the implications of the article was at the centre of the letter exchange. The introduction provides some background for the exchange. |
| Keywords: | history; econometrics |
| JEL: | B23 |
| Date: | 2010–08–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2010_007&r=hpe |
| By: | Andersson, O.; Argenton, C.; Weibull, J. (Tilburg University, Center for Economic Research) |
| Abstract: | We model a player’s uncertainty about other players’ strategy choices as smooth probability distributions over their strategy sets. We call a strategy profile (strictly) robust to strategic uncertainty if it is the limit, as uncertainty vanishes, of some sequence (all sequences) of strategy profiles, in each of which every player’s strategy is optimal under under his or her uncertainty about the others. We derive general properties of such robustness, and apply the definition to Bertrand competition games and the Nash demand game, games that admit infinitely many Nash equilibria. We show that our robustness criterion selects a unique Nash equilibrium in the Bertrand games, and that this agrees with recent experimental findings. For the Nash demand game, we show that the less uncertain party obtains the bigger share. |
| Keywords: | Nash equilibrium;refinement;strategic uncertainty;price competition;Bertrand competition;bargaining;Nash demand game |
| JEL: | C72 D43 L13 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:201070&r=hpe |
| By: | Harvey, James S. Jr. |
| Abstract: | In this paper I consider the question of whether ethical decision-making affects a personâs happiness. Using cross-country data from the World Values Survey, I find that people who agree that it is never justifiable to engage in ethically-questionable behaviors report that they are more satisfied with their life than people who are more tolerant of unethical conduct, even after controlling for other factors known to affect self-reported happiness. The size of the ethics effect is roughly similar to that of a modest increase in income, being married and attending church, while the effect is smaller than that of having poor health or being dissatisfied with oneâs personal finances. These results are robust across the four countries studied (the US, Canada, Mexico and Brazil), although there is variation in the ethics and happiness relationship across countries. One implication of this study is that a consideration of a societyâs ethical norms will improve our understanding of the subjective well-being of people. |
| Keywords: | Happiness, subjective well-being, ethics, World Values Survey, Labor and Human Capital, D63, D99, Z13, |
| Date: | 2009–12–02 |
| URL: | http://d.repec.org/n?u=RePEc:ags:umcowp:92617&r=hpe |
| By: | Alain Béraud (THEMA - Théorie économique, modélisation et applications - CNRS : UMR8184 - Université de Cergy Pontoise) |
| Abstract: | Pour Walras, l'économie politique est, à la fois, l'exposé de ce qui est et le programme de ce qui devrait être. Dans son analyse de l'équilibre général, la libre concurrence apparaît comme un mécanisme autorégulateur de la production des richesses. Mais cette démonstration, en montrant sous quelles hypothèses le marché conduit à une situation où la satisfaction des agents est maximale, met en évidence les situations où l'échec du marché rend nécessaire une intervention de l'état. |
| Keywords: | Walras, Dupuit, services publics, monopole naturel, optimum |
| Date: | 2010–09–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00508902_v1&r=hpe |
| By: | Geir B. , Asheim (Dept. of Economics, University of Oslo); Voorneveld, Max (Department of Economics, Stockholm School of Economics); W. Weibull, Jörgen (Department of Economics, Stockholm School of Economics) |
| Abstract: | This paper provides a definition of epistemic stability of sets of strategy profiles,and uses it to characterize variants of curb sets in finite games, including the set of rationalizable strategies and minimal curb sets. |
| Keywords: | Epistemic game theory; epistemic stability; rationalizability; closedness under rational behavior; mutual p-belief |
| JEL: | C72 D83 |
| Date: | 2009–12–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2010_001&r=hpe |