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on History and Philosophy of Economics |
| By: | Reinert, Erik S. |
| Abstract: | "As we look over the country today we see two classes of people. The excessively rich and the abject poor, and between them is a gulf ever deepening, ever widening, and the ranks of the poor are continually being recruited from a third class, the well-to-do, which class is rapidly disappearing and being absorbed by the very poor." Milford Wriarson Howard (1862-1937), in The American Plutocracy, 1895. This paper argues for important similarities between today’s economic situation and the picture painted above by Milford Howard, a member of the US Senate at the time he wrote The American Plutocracy. This was the time, the 1880s and 1890s, when a combination of Manchester Liberalism – a logical extension of Ricardian economics – and Social Darwinism – promoted by the exceedingly influential UK philosopher Herbert Spencer – threatened completely to take over economic thought and policy on both sides of the Atlantic. At the same time, the latter half of the 19th century was marred by financial crises and social unrest. The national cycles of boom and bust were not as globally synchronized as they later became, but they were frequent both in Europe and in the United States. Activist reformer Ida Tarbell probably exaggerated when she recalled that in the US “the eighties dripped with blood”, but a growing gulf between a small and opulent group of bankers and industrialists produced social unrest and bloody labour struggles. The panic on May 5, 1893 triggered the worst financial crisis in the US until then. |
| Keywords: | Capitalism; economic history; Thorstein Veblen |
| JEL: | N00 P10 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:47931&r=hpe |
| By: | Thomas Huth (Leuphana University Lueneburg, Germany) |
| Abstract: | The present paper on the now partly well known Russian mathematician and “amateur economist” v. Charasoff was originally written in 1987 together with H. Duffner three years after Charasoff’s remarkable contribution of 1910 “Das System des Marxismus” (The system of Marxism) had been rediscovered by the Italian economists Gilibert and Egidi. It was then the second mathematical formulation of Charasoff’s contribution on prominent but partly still unresolved topics in Marxian economics. However, though our paper circulated as mimeo it had not been published in a regular journal of economics. Meanwhile, several contributions on Charasoff appeared by such authors as Egidi, Gilibert, Kurz and Salvadori, Stamatis and Mori. But none of them seems to deal with Charasoff’s economics in an exhaustive manner. Therefore and nevertheless, the paper may be still of some interest to the, nowadays regrettably rather narrow, audience of economists specialized in linear models of production, Marxian economic theory and Neoricardianism. |
| Keywords: | Marxian economics, labor theory of value, transformation problem, prices of production |
| JEL: | B14 B51 C67 D24 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:279&r=hpe |
| By: | Esteban Pérez Caldentey; Matias Vernengo |
| Abstract: | Keynes had a profound influence on Prebisch in terms of the diagnosis about the main failures of market economies and the need to pursue pro-active and anti-cyclical policies. However, Prebisch was critical of some aspects of Keynes’ General Theory of Employment, Interest and Money, in particular on the theory of interest and the multiplier. His attitude can be explained by a difference in the object and method of analysis. Prebisch interests focused on dynamics and the cycle, themes that were peripheral to Keynes’ central message. Prebisch’s Keynesian influence and his rejection of some aspects of Keynes magnum opus explains why at the same time that Prebisch is often described as the Latin American Keynes, he is portrayed as concerned mainly with the long-run development problem of Latin America and without proper consideration to demand factors as fundamental determinants of output and employment. |
| Keywords: | Business Cycles, Interest Rate, Multiplier, Center-Periphery JEL Classification: B22, E32, E40, F55 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:uta:papers:2013_08&r=hpe |
| By: | Mosca, Manuela |
| Abstract: | Abstract: This paper analyses the economist Antonio de Viti de Marco’s collaboration with the daily press, in relation to his scientific work and in the context of early twentieth century Italy. It brings out De Viti’s proposals for free trade and fiscal policies intended to support the development of the southern regions of Italy, as well as his critical attitude towards the public sector and its decision making processes. It also highlights his political activities and commitment, an important aspect of his achievement, yet all but unknown outside Italy. |
| Keywords: | Antonio de Viti de Marco, history of economics, Italian marginalism, daily newspapers, economic policies |
| JEL: | B20 B31 D72 F13 H3 H30 R11 |
| Date: | 2013–07–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:47963&r=hpe |
| By: | Arie Krampf |
| Abstract: | During the 20th century, the institution called central bank was diffused globally. However, central banking practices differed significantly between European market-based economies and developing economies. This paper traces the ideas and norms that shaped and legitimized central banking practices in the two areas. The paper argues that during the period from the 1940s to the 1970s two central banking policy norms existed: the liberal norm, which emerged in Europe, and the developmental central banking norm, which emerged in Latin America and diffused to East Asia. The paper seeks to trace the life cycles of the two norms: to specify the ideational content of each norm and to identify the actors and networks that produced, promoted and diffused them. The paper makes two contributions. First, theoretically, on the basis of Finnemore and Sikkink’s theory of international norms’ dynamics, it introduces a mechanism that explains the emergence and internationalization of an alternative international norm in the periphery that challenges the standard international norm. Second, it contributes to the literature on comparative regionalism by historicizing the liberal/European standard of central banking practices and by identifying the existence of an alternative standard for central banking practices in developing countries. The paper covers the period from the 1940s to the 1970s. |
| Keywords: | regulations; European Central Bank; European Central Bank; economics; history |
| Date: | 2013–04–23 |
| URL: | http://d.repec.org/n?u=RePEc:erp:kfgxxx:p0049&r=hpe |
| By: | Martin Ravallion |
| Abstract: | How did we come to think that eliminating poverty is a legitimate goal for public policy? What types of policies have emerged in the hope of attaining that goal? The last 200 years have witnessed a dramatic change in thinking about poverty. Mainstream economic thinking in the 18th century held that poverty was necessary and even desirable for a country’s economic success. Today, poverty is more often viewed as a constraint on that success. In short, poverty switched from being seen as a social good to a social bad. This change in thinking, and the accompanying progress in knowledge, has greatly influenced public action, with heightened emphasis on the role of antipoverty policy in sustainable promotion from poverty, as well as protection. Development strategies today typically strive for a virtuous cycle of growth with equity and a range of policy interventions have emerged that aim to help assure that outcome. An expanding body of knowledge has taught us about how effective those interventions are in specific settings, although many knowledge gaps remain. |
| JEL: | B1 B2 I38 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19210&r=hpe |
| By: | Boldizzoni, Francesco |
| Abstract: | It is often said that history matters, but these words are often little more than a hollow statement. In the aftermath of the Great Recession, the view that the economy is a mechanical toy that can be fixed using a few simple tools has continued to be held by economists and policy makers and echoed by the media. The paper addresses the origins of this unfortunate belief, inherent to neoliberalism, and what can be done to bring time back into public discourse. -- Es heißt, dass Geschichte wichtig sei, aber oft ist dies nicht mehr als eine Redensart. Ökonomen und Politiker halten mit Unterstützung der Medien auch nach der Großen Rezession an der Ansicht fest, dass die Wirtschaft ein mechanisches Spielzeug ist, das mit ein paar einfachen Werkzeugen repariert werden kann. In dem vorliegenden Papier betrachtet der Autor die Ursprünge dieses dem Neoliberalismus innewohnenden Irrglaubens und untersucht, wie geschichtlich-zeitliche Zusammenhänge zurück in den öffentlichen Diskurs gebracht werden können. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:mpifgd:136&r=hpe |
| By: | Jason Shachat (Wang Yanan Institute for Studies in Economics (WISE) and the MOE Key Laboratory in Econometrics, Xiamen University, Xiamen, Fujian Province, 361005, China); J. Todd Swarthout (Department of Economics, Georgia State University, Atlanta, GA, 30303, USA) |
| Abstract: | We conduct an experiment in which we auction the scarce rights to play the Proposer and Responder positions in subsequent ultimatum games. As a control treatment, we randomly allocate these rights and then charge exogenous participation fees according to the auction price sequences observed in the auction treatment. With endogenous selection into ultimatum games via auctions, we find that play converges to a session-specific Nash equilibrium and auction prices emerge which support this equilibrium by the principle of forward induction. With random assignment and exogenous participation fees, we find play also converges to a session-specific Nash equilibrium as predicted by the principle of loss avoidance. The Nash equilibrium observed within a session results in low ultimatum game offers, but the subgame perfect Nash equilibrium is never observed. |
| Keywords: | Ultimatum Bargaining, Auction, Forward Induction |
| JEL: | C92 C78 D44 |
| Date: | 2013–03–28 |
| URL: | http://d.repec.org/n?u=RePEc:fee:wpaper:1301&r=hpe |
| By: | Anna Maffioletti; Agata Maida; Francesco Scacciati |
| Abstract: | In the literature of happiness economics individual subjective utility is measured by directly asking individuals to self-assess their level of utility, usually on a numerical scale, using various terms such as happiness, life satisfaction and well-being, most of the times taking for granted that they are synonymous. Despite the richness of happiness economics literature, several terminological and methodological issues still need to be investigated. This paper presents the results of a field survey conducted in the Region of Piedmont (Northern Italy) by means of 1250 face-to-face interviews, financed by Piedmont Government, in order to assess the level of happiness, life satisfaction and quality of life using three different scales: a verbal one (7 steps from, say, very unhappy to very happy, a unipolar cardinal scale (from 1 to 7) and bipolar cardinal scale (from -3 to 3). We have also examined the effects of wording and scales on those that turned out to be the main determinants of the three notions. We show that wording clearly matters: not only each subject (in most cases) self-reports differently her/his own happiness, life satisfaction and well-being and therefore they may be similar but not equivalent notions, but also their determinants turn out to be different. Moreover, we find that the use of different scales leads to different results. However, a clear pattern does not emerge: therefore we cannot state which numerical scale performs better in representing the verbal self-reported valuations. |
| Keywords: | Happiness, Satisfaction, Well-Being, Survey Design |
| JEL: | B21 B41 C83 D03 J28 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wplabo:131&r=hpe |
| By: | Oikonomou, V.K.; Jost, J |
| Abstract: | We define and study periodic strategies in two player finite strategic form games. This concept can arise from some epistemic analysis of the rationalizability concept of Bernheim and Pearce. We analyze in detail the pure strategies and mixed strategies cases. In the pure strategies case, we prove that every two player finite action game has at least one periodic strategy, making the periodic strategies an inherent characteristic of these games. Applying the algorithm of periodic strategies in the case where mixed strategies are used, we find some very interesting outcomes with useful quantitative features for some classes of games. Particularly interesting are the implications of the algorithm to collective action games, for which we were able to establish the result that the collective action strategy can be incorporated in a purely non-cooperative context. Moreover, we address the periodicity issue for the case the players have a continuum set of strategies available. We also discuss whether periodic strategies can imply any sort of cooperativity. In addition, we put the periodic strategies in an epistemic framework. |
| Keywords: | Game Theory;Rationalizability;Solution Concepts, Periodicity;Epistemic Game Theory |
| JEL: | C0 C02 C70 C72 |
| Date: | 2013–07–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:48117&r=hpe |
| By: | Dorian Jullien; Judith Favereau; Cléo Chassonnery-Zaigouche |
| Abstract: | This paper investigates how foundational and conceptual issues around economic rationality, which are usually discussed with respect to economic theory, materialize into recent applied microeconomics. We concentrate on three radically different subfield of microeconomics – the economics of discrimination, development economics and the economics of insurance – to look at how the recent rise of experimental methods and behavioral economics within mainstream economics have changed the conceptual relationship between economic rationality and economic efficiency, without changing the substance of these notions. The perspective of going from applied work of microeconomics in the field to conceptual and foundational issues on rationality reveals another issue that has not been much discussed in the reflexive literature yet: how warranted is the analytical distinction made in economics among interpersonal preferences, intertemporal preferences and preferences for risk and uncertainty? We show that this issue has straightforward consequences both on both economic theory and on the real world through the policy recommendations made by microeconomists. |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2013-21&r=hpe |
| By: | George J. Mailath (Department of Economics, University of Pennsylvania); Larry Samuelson (Department of Economics, Yale University) |
| Abstract: | This paper, prepared for the Handbook of Game Theory, volume 4 (Peyton Young and Shmuel Zamir, editors, Elsevier Press), surveys work on reputations in repeated games of incomplete information. |
| Keywords: | commitment, incomplete information, reputation bound, reputation effects, long-run relationships, reputations |
| JEL: | C70 C73 |
| Date: | 2013–06–27 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:13-034&r=hpe |
| By: | Mario Bravo (Instituto de Sistemas Complejos de Ingenieria (ISCI), Universidad de Chile); Mathieu Faure (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS) |
| Abstract: | Consider a 2-player normal-form game repeated over time. We introduce an adaptive learning procedure, where the players only observe their own realized payoff at each stage. We assume that agents do not know their own payoff function, and have no information on the other player. Furthermore, we assume that they have restrictions on their own action set such that, at each stage, their choice is limited to a subset of their action set. We prove that the empirical distributions of play converge to the set of Nash equilibria for zero-sum and potential games, and games where one player has two actions. |
| Keywords: | Reinforcement learning, fictitious play, Markovian procedures. |
| Date: | 2013–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1335&r=hpe |
| By: | Vorobyev, Oleg Yu. |
| Abstract: | Remaking the primary source of an old good idea of the “lattice expectation”, published by me in 1975 at the first time and subsequently, especially in the western literature on stochastic geometry and the theory of random sets, named from a light hand of Dietrich Stoyan [1994] “Vorob’ev expectation”; had an only historical and methodic value for eventology and probability theory once more reminding how and “...from what rubbish flowers grow, not knowing shame”. |
| Keywords: | Probability theory, random set, mean measure set, lattice expectation, Vorob’ev expectation, eventology. |
| JEL: | C02 C30 |
| Date: | 2013–04–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:48102&r=hpe |
| By: | Sébastien Courtin; Bertrand Tchantcho (THEMA, University of Cergy-Pontoise, France.; University of Yaounde I, Advanced Teachers’ Training College,) |
| Abstract: | The desirability relation was introduced by Isbell (1958) to qualitatively compare the a priori influence of voters in a simple game. In this paper, we extend this desirability relation to simple games with coalition structure. In these games, players organize themselves into a priori disjoint coalitions. It appears that the desirability relation defined in this paper is a complete preorder in the class of swap-robust games. We also compare our desirability relation with the preorders induced by the generalizations to games with coalition structure of the Shapley-Shubik and Banzahf-Coleman power indices (Owen, 1977, 1981). It happens that in general they are different even if one considers the subclass of weighed voting games. However, if structural coalitions have equal size then both Owen-Banzhaf and the desirability preordering coincide. |
| Keywords: | Voting games; Coalition structure; Power indices; Desirability relation |
| JEL: | C71 D72 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:ema:worpap:2013-30&r=hpe |
| By: | Giuseppe De Marco (Università di Napoli Parthenope and CSEF); Maria Romaniello (Seconda Università di Napoli) |
| Abstract: | In this paper we consider a model of games of incomplete information under ambiguity in which players are endowed with variational preferences. We provide an existence result for the corresponding mixed equilibrium notion. Then we study the limit behavior of equilibria under perturbations on the indices of ambiguity aversion. |
| Keywords: | Incomplete information games, multiple priors, variational preferences, equilibria |
| Date: | 2013–07–09 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:336&r=hpe |
| By: | Laurent Denant-Boèmont (CREM CNRS UMR 6211, University of Rennes 1, France); Olivier l'Haridon (CREM CNRS UMR 6211, University of Rennes 1, France) |
| Abstract: | Ces trente dernières années ont connu un formidable développement d’un nouveau champ de l’analyse économique, l’économie comportementale. Initiée et fondée en partie sur les méthodes de l’économie expérimentale, ce nouveau champ disciplinaire a profondément renouvelé la vision des décisions des agents économiques et celle du fonctionnement des marchés. Cet article propose un éclairage critique sur le renouvellement de la vision de la rationalité des agents économiques proposé par l’économie comportementale. Dans les faits, la démonstration de l’existence de déviations par rapport aux représentations traditionnelles de la rationalité est le résultat du croisement de deux littératures. La première concerne les décisions dans l’incertain. La seconde s’intéresse aux décisions prises en interactions avec d’autres agents économiques. Le cadre d’étude est celui des jeux, des marchés et des décisions de groupe. En regard du premier ensemble de travaux, la question de la rationalité se porte sur la réalité d’une norme de comportement purement individuelle, liée à l’introspection. Le contexte de choix apparaît comme primordial aux décisions prises par les individus et cette porosité aux circonstances semble être la manifestation la plus saillante de la rationalité limitée. Pour le second ensemble de travaux, les résultats sont nettement plus ambigus et peuvent laisser perplexe. Dans certaines situations d’interaction stratégique ou de marché, la rationalité collective observée est proche de celle prédite par la théorie microéconomique traditionnelle. Mais dans d’autres, il s’avère que des éléments absents de la modélisation économique s’avèrent essentiels : préférences sociales, émotions, processus d’apprentissage. Cet apparent paradoxe montre l’importance d’enrichir le domaine même de la rationalité afin d’améliorer le pouvoir prédictif des théories économiques des comportements et des marchés. |
| Keywords: | rationalité, économie comportementale, décisions, interactions sociales, théorie des jeux. |
| JEL: | D90 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:201323&r=hpe |
| By: | A.P.Thirlwall |
| Abstract: | Kaldor's 1970 paper 'The Case for Regional Policies' was republished in the sixtieth anniversary volume of the Scottish Journal of Political Economy. This paper reflects on the model after more than forty years, and argues that even though it has been criticised for its deterministic nature, it has lost none of its relevance. It predates the ideas of so-called 'new' growth theory, and the new economic geography of Krugman, and provides at least a partial explanation of why growth rates and levels of per capita income between regions and between countries can continue to persist and even widen in contrast to the predictions of orthodox equilibrium theory. |
| Keywords: | Regional Growth; Kaldor; Uneven Development; Cumulative Causation |
| JEL: | O18 R11 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:1311&r=hpe |