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on History and Philosophy of Economics |
| By: | Gul, Ejaz; Chaudhry, Imran Sharif; Faridi, Muhammad Zahir |
| Abstract: | For almost a century, the famous C-K paradigm (formally known as Classics – Keynesian Paradigm) has been the apex of economic debate and research. The paradigm represents two schools of thoughts which, somehow, have prevailed till now. Economists who believe in either of the two schools have been at loggerheads, and they still are, to prove one theory better than the other. Numerous economic scholars of present era believe that with the changes that have occurred in the economic system, the world is turning back to classical model. But, there are others who believe that Keynes theory is still alive and valid. In this paper, we have tried to draw a brief comparison that highlights the major differences between the two theories with specific reference to the economic, political and social environment prevailing at time when these theories were generated. Paper also discusses the relevance of unending policy debate about these theories in the current era with special emphasis on policy implications with a view to draw pertinent lessons for the present and future. |
| Keywords: | Classical, Keynesian, economics, theories, policy, debate, implications |
| JEL: | B10 B11 B12 B15 B2 B22 |
| Date: | 2014–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:53920&r=hpe |
| By: | Taylor, Leon |
| Abstract: | The theory of money supply is less developed than that of money demand, largely because 19th-century economists believed that money was unimportant and because they viewed the central bank as either an appendage to the economy or as a welfare-maximizing black box. The paper reviews each of these beliefs in turn. |
| Keywords: | money supply, history of economic thought, central bank |
| JEL: | B19 B22 |
| Date: | 2014–03–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:54208&r=hpe |
| By: | Taylor, Leon |
| Abstract: | Economists failed to forecast the Great Depression, perhaps because they had lacked reason to theorize enough about business cycles. Since theory is a public good, the market produces too little of it. The prospect of ex post fame may induce theory; but fame comes from explaining famous events, not from averting adverse events. Also, learning-by-doing induces theory by cutting its cost, favoring the first theories to be developed. These dealt with markets – not business cycles – in the decades before the Depression. |
| Keywords: | Great Depression, theory of business cycles, history of macroeconomic thought, marketplace of ideas, learning by doing. |
| JEL: | B10 E32 |
| Date: | 2014–03–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:54214&r=hpe |
| By: | Mark Setterfield |
| Abstract: | Beyond agreement on the basic principles of money’s endogeneity, the development of Post-Keynesian monetary theory has been characterized by considerable dissent and debate. One important aspect of this debate concerns the shape of the credit supply curve in quantity of credit/interest rate space. The argument in this chapter is that that there can be, and to an extent already is, agreement that the horizontal credit supply curve is not a special case, and that the existence of an indeterminate dynamic credit supply schedule provides a general framework capable of accommodating both horizontalist and structuralist arguments. These arguments rest on the distinction between logical and historical time and, in particular, the claim that any construct (including, for example, a credit supply schedule) that is akin to a determinate long run equilibrium relationship is anathema to the methodological foundations of Post-Keynesian economics. |
| Keywords: | Endogenous money, horizontalism, structuralism, historical time, supply of credit |
| JEL: | E12 E42 E43 E51 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:tri:wpaper:1402&r=hpe |
| By: | Bart J. Wilson (Chapman University, Economic Science Institute) |
| Keywords: | experimental economics, deception, professional ethics of economists |
| JEL: | C90 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:chu:wpaper:14-05&r=hpe |
| By: | Nicolas Barbaroux (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure (ENS) - Lyon - PRES Université de Lyon - Université Jean Monnet - Saint-Etienne - Université Claude Bernard - Lyon I); Michel Bellet (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure (ENS) - Lyon - PRES Université de Lyon - Université Jean Monnet - Saint-Etienne - Université Claude Bernard - Lyon I) |
| Abstract: | Myrdal's works are usually analysed with a dual and separated point of view : on the one hand the methodological papers concerning the value problem and based on a strong non neutrality thesis ; on the other part the theoretical analysis concerning monetary theory and policy, with a Wicksellian filiation. In fact both the dimensions are strongly connected by a common way : the application of the Hägerström's Swedish guillotine between is and ought, but also the construction of a bridge between economic science and political views on social engineering and economic policy. Myrdal wants to address this problem : how economic science can become politically relevant ? This paper analyses two stages of that unique project : the proposition of a "technology of economics" (1930), and the selection process for a "norm for monetary policy" (1939). It shows that Myrdal distorts an initial end and means scheme by proposing some intermediary concepts between positive and normative fields. From a theoretical and statistical framework and an explicit value judgment these concepts enable to elaborate an iterative tree of selection of a speci-c monetary policy. If the Myrdal's project encounters difficulties in conciliating a non-cognitivist thesis with economic prescriptions and in proposing a tractable method, it remains an important benchmark for the analysis of the links between positive and normative views concerning monetary policy. |
| Keywords: | value judgment; monetary policy; positive analysis; normative analysis |
| Date: | 2014–02–26 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00952009&r=hpe |
| By: | Stan Du Plessis |
| Abstract: | In 1967 Milton Friedman delivered “The Role of Monetary Policy’ as his presidential address to the American Economic Association (AEA). In its published version – Friedman (1968) – it has become, arguably, the most influential paper in modern monetary economics and was recently included in the AEA’s list of the twenty most influential papers published in the first century of the American Economic Review. But the influence of Friedman’s address is based on an interpretation that seriously distorts the content of his main argument. His emphasis on (i) the inadequacy of interest rate policy and (ii) the primacy of financial stability among the positive goals of monetary policy have been ignored or neglected. While balance sheet policies have become ‘unconventional’ in the modern consensus, these policies held a central position in Friedman’s work. I support this argument with a textual analysis of Friedman’s address, read in the light of his preceding scholarship on monetary policy. This reinterpretation is relevant in a world where the balance sheets of central banks have returned to centre stage as has the priority for financial stability. |
| Keywords: | Milton Friedman, Monetary policy, interest rate policy, balance sheet policies, Financial Stability |
| JEL: | B22 E52 E58 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:rza:wpaper:419&r=hpe |
| By: | Andrew E. Clark; Sarah Flèche; Claudia Senik |
| Abstract: | In spite of the great U-turn that saw income inequality rise in Western countries in the 1980s, happiness inequality has dropped in countries that have experienced income growth (but not in those that did not). Modern growth has reduced the share of both the “very unhappy” and the “perfectly happy”. The extension of public amenities has certainly contributed to this greater happiness homogeneity. This new stylized fact comes as an addition to the Easterlin paradox, offering a somewhat brighter perspective for developing countries. |
| Keywords: | Happiness, inequality, economic growth, development, Easterlin paradox |
| JEL: | D31 D6 I3 O15 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp633&r=hpe |
| By: | Sedlarski, Teodor |
| Abstract: | This article investigates the analytical line of reasoning in D. North’s, J. Wallis’ and B. Weingast’s research project “Violence and Social Orders”, which unifies in an institutional explanation scheme the control over violence in human societies, the equilibrium of interests among the ruling coalition that secures the peace, and the possible transition to impersonal exchange. As the market exchange isn’t a naturally given form of organizing social interaction, but requires erecting of specific institutional settings, this study demonstrates the new institutional approach to the explanation of the developments in economic history which made free markets and the democratic state organization possible during the European Renaissance. Research projects like Nort’s, Wallis’ and Weingast’s pave the way for creating a modern political economy, which - based on a contemporary analytical apparatus – synthesizes the achievements in the social sciences of the last decades with the tradition of the early economic thought. |
| Keywords: | new economic history, institutional economics, political economy, open access societies, limited access societies, rule of law, impersonal exchange, monopoly of organized violence |
| JEL: | A12 B23 B25 B52 O43 P16 Z10 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:52427&r=hpe |
| By: | van Suntum, Ulrich |
| Abstract: | 100 years after Böhm-Bawerks death and nearly 70 years after Keynes has died there is still fundamental controversy about the factors which determine the interest rate in the long run. While Economists in the Austrian tradition see it as solely driven by real phenomena, Keynesian authors mainly stress the monetary factors. Likewise, the current phase of low interest rates is explained in most different ways by prominent economists. While many blame the expansive monetary policy, others point to excess capital supply in ageing industrial states. The present paper seeks to combine these explanations by the use of a stock-flow-consistent macro-model. It is argued that theories in the tradition of Böhm-Bawerk and Keynes respectively do not at all preclude each other but, on the contrary, can nicely be combined. -- Auch 100 Jahre nach dem Tode Böhm Bawerks und nahezu 70 Jahre nach dem Tod von Keynes sind die langfristigen Bestimmungsgründe des Zinses noch immer umstritten. Den realwirtschaftlichen Theorien der österreichischen Schule stehen die vorwiegend monetären keynesianischen Erklärungsansätze nach wie vor scheinbar unversöhnlich gegenüber. Auch die aktuellen Niedrigzinsen werden von prominenten Ökonomen ganz unterschiedlich erklärt. Viele sehen sie als direkte Folge der expansiven Geldpolitik der Notenbanken, andere verweisen dagegen auf einen Kapitalangebotsüberschuss in den alternden Industriegesellschaften. Der vorliegende Beitrag versucht, diese Sichtweisen im Rahmen eines Strom-Bestandgrößen-konsistenten Makromodells miteinander zu kombinieren. Es wird gezeigt, dass sich die Erklärungsansätze in der Tradition von Böhm-Bawerks und Keynes keineswegs ausschließen, sondern gut gegenseitig ergänzen. |
| Keywords: | public debt,stock flow consistent model,monetary policy |
| JEL: | E10 E40 E50 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cawmdp:65&r=hpe |
| By: | Michel Bellet (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France, Université Jean Monnet, Saint-Etienne, F-42000, France) |
| Abstract: | L’antiphysiocratie des saint-simoniens peut paraître assez naturelle. En effet, une doctrine saint-simonienne réputée pour son industrialisme utopiste ne pouvait, semble t-il, que s’opposer à ce que Smith a appelé le "système agricole". Cette interprétation, sans être totalement erronée, est une réduction abusive du point de vue saint-simonien. En effet, si, au début du XIXème siècle, les saint-simoniens peuvent être rangés dans la catégorie des "néo-smithiens" qui réfutent la thèse selon laquelle la terre est à l’origine de la richesse, ils le font à partir d’une approche spécifique, opposant oisifs et travailleurs. Cette partition modifie les débats classiques concernant le rôle des diverses classes et des revenus qui y sont associés, tout en légitimant un programme anti-physiocrate, opposé au rôle économique et politique des propriétaires fonciers. Pour autant, les saint-simoniens ne se contentent pas de cette opposition : ils soutiennent la méthode de Quesnay et sa définition de l’économie politique. Selon eux, il faut raisonner à partir d’un système, et une philosophie générale des rapports sociaux doit précéder la science des richesses. Même si la nature de cette philosophie diffère (droit naturel vs évolutionnisme historique et physiologique), cette communauté de vue revendiquée concernant la méthode et le refus d’autonomie de l’économie politique conduit les saint-simoniens à une définition et un usage originaux de leur antiphysiocratie, dans le contexte du premier tiers du XIXème siècle. |
| Keywords: | Physiocracy, Quesnay, Saint-Simonism, Post-Smithian Theory, System |
| JEL: | B1 N5 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1409&r=hpe |
| By: | Brañas-Garza, Pablo; Rodriguez-Lara, Ismael |
| Abstract: | We report experimental data on expectations about generosity in a dictator game in which dictators first divide the pie and then make a guess about the donation of other dictators. In our experiment, recipients have to guess the donation that they are going to receive from their own dictator as well as the donation of other dictator, whose choice does not affect their own payoffs. Our findings indicate that property rights are important to explain guesses, as dictators predict a smaller donation from other dictators than recipients do. We also observe that the involvement in the game is crucial as recipients expect other dictators to be more generous than their own dictator. When we compare guesses with actual donations, we see that dictators' guesses are positively correlated with their own transfer and that recipients overestimate the kindness of other dictators, as they expect them to be more kind than what they actually are. |
| Keywords: | generosity, expectations, dictator game, fairness, property rights, involvement. |
| JEL: | C9 D63 D64 |
| Date: | 2014–02–26 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:53760&r=hpe |
| By: | EMMANOEL DE OLIVEIRA BOFF |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:013&r=hpe |
| By: | Sidartha Gordon (Département d'économie); Ying Chen |
| Abstract: | We introduce a “nestedness” relation for a general class of sender-receiver games and compare equilibrium properties, in particular the amount of information transmitted, across games that are nested. Roughly, game is nested in game if the players’s optimal actions are closer in game. We show that under some conditions, more information is transmitted in the nested game in the sense that the receiver’s expected equilibrium payoff is higher. The results generalize the comparative statics and welfare comparisons with respect to preferences in the seminal paper of Crawford and Sobel (1982). We also derive new results with respect to changes in priors in addition to changes in preferences. We illustrate the usefulness of the results in three applications: (i) delegation to an intermediary with a different prior, the choice between centralization and delegation, and two-way communication with an informed principal. |
| Keywords: | sender-receiver games, information transmission, nestedness, inter- mediary, delegation, informed principal. |
| Date: | 2014–04 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpecon:info:hdl:2441/5adcidkke9omt0s9p6m01j1rh&r=hpe |
| By: | Franz Dietrich; Christian List |
| Abstract: | "Reason-based rationalizations" explain an agent's choices by specifying which properties of the options or choice context he/she cares about (the "motivationally salient properties") and how he/she cares about these properties the "fundamental preference relation"). We characterize the choice-behavioural implications of reason-based rationalizability and identify two kinds of context-dependent motivation in a reason-based agent: he/she may (i) care about different properties in different contexts and (ii) care not only about properties of the options, but also about properties relating to the context. Reason-based rationalizations can explain non-classical choice behaviour, including boundedly rational and sophisticated rational behaviour, and predict choices in unobserved contexts, an issue neglected in standard choice theory. |
| JEL: | D01 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:cep:stitep:/2014/565&r=hpe |
| By: | Burkhard Schipper (Department of Economics, University of California Davis) |
| Abstract: | This article provides a brief survey of the literature on unawareness and introduces the contributions to the special issue on unawareness in Mathematical Social Sciences. First, we provide a brief overview both about epistemic models of unawareness and models of extensive-form games with unawareness. Instead of introducing the approaches in full detail, we illustrate the main differences and similarities with the help of examples. Finally, we discuss the contributions to the special issue on unawareness. |
| Keywords: | Unawareness, awareness, incomplete information, knowledge, belief, extensive-form games |
| JEL: | C70 D80 |
| Date: | 2014–02–27 |
| URL: | http://d.repec.org/n?u=RePEc:cda:wpaper:14-5&r=hpe |
| By: | Popov, Vladimir |
| Abstract: | Utopian socialists believed that socialism is inevitable because it is a more rational system to organize production and life, a system more in line with the “good” nature of human beings. Marxism rejected this reasoning replacing it with what is known as historical materialism: social systems, it argued, emerge, develop and die not because they correspond more or less to the “natural” aspirations of the people, but because they become more or less competitive in the process of historical evolution – a version of social Darwinism applied not to individuals, but to communities and countries. In particular, Marxism stated that capitalism develops productive forces up to the point when they can no longer be managed efficiently in societies with markets and private property; at this point social property of the means of production and centrally planned economy (CPE) become a more efficient way of managing productive forces, whose social nature has outgrown the narrow capitalist limits. This prediction did not come true – in the XX century socialism came to being not in most advanced capitalist countries, but in the periphery and semi-periphery (USSR, Eastern Europe, China, North Korea, Cuba), and only in North Korea and Cuba it survived into the XXI century. This paper explains why capitalism was competitive in recent 500 years, and why an attempt in the XX century to replace it by socialist CPEs did not succeed. But it argues that there are other reasons, not associated with “social nature of productive forces”, which are finally going to make socialism competitive: the costs of numerous negative consequences of high income inequalities, like greater social tensions, high crime and poor institutional capacity of the state, become larger than the benefits of high savings and investment rate that were making capitalism competitive for 500 years. This “new socialism” will not be necessarily mean a total elimination of markets and private property, but is likely to limit both substantially for the sake of achieving lower income inequality. |
| Keywords: | Socialism, inequalities, savings, growth, economic history |
| JEL: | N00 O1 O10 P0 P1 P2 |
| Date: | 2014–03–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:54294&r=hpe |
| By: | NISHIMURA Kazuo; HIRATA Junichi; YAGI Tadashi; URASAKA Junko |
| Abstract: | This paper aims to verify how discipline affects a person's value in the labor market by examining the effect of the discipline a person received in his/her childhood on the labor income he/she gets as an adult. The analysis shows that one's value in the labor market is greatly affected by four fundamental morals defined in this paper as follows: (1) Be honest, (2) Be kind to others, (3) Keep the rule, and (4) Keep learning. A comparison of the yearly income between an adult who was taught all four morals and an adult who was not taught either any or all of the four morals showed that the former earned about 570,000 yen more than the latter; in turn, those who were taught all of the four basic morals earned about 860,000 yen higher than those who were not taught any of them. Furthermore, this research analyzed the influence of discipline on ethics and value judgment and shows that adults who were taught the four morals tend to make value judgments that are better in terms of sociality. |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:14011&r=hpe |
| By: | Pavlina R. Tcherneva |
| Abstract: | It is common knowledge that John Maynard Keynes advocated bold government action to deal with recessions and unemployment. What is not commonly known is that modern "Keynesian policies" bear little, if any, resemblance to the policy measures Keynes himself believed would guarantee true full employment over the long run. This paper corrects this misconception and outlines "the road not taken"; that is, the long-term program for full employment found in Keynes's writings and elaborated on by others in works that are missing from mainstream textbooks and policy initiatives. The analysis herein focuses on why the private sector ordinarily fails to produce full employment, even during strong expansions and in the presence of strong government action. It articulates the reasons why the job of the policymaker is, not to "nudge" private firms to create jobs for all, but to do so itself directly as a matter of last resort. This paper discusses various designs of direct job creation policies that answer Keynes's call for long-run full employment policies. |
| Keywords: | Unemployment as a Monetary Phenomenon; Long-run Full Employment; John Maynard Keynes; Social Economy; Aggregate Demand Management |
| JEL: | B3 E2 E6 H1 H31 J68 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_789&r=hpe |
| By: | LAURA VALLADÃO DE MATTOS |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:001&r=hpe |
| By: | EMMANOEL DE OLIVEIRA BOFF |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:015&r=hpe |
| By: | FELIPE ALMEIDA |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:008&r=hpe |
| By: | MAURICIO C. COUTINHO |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:006&r=hpe |
| By: | Daron Acemoglu; Francisco A. Gallego; James A. Robinson |
| Abstract: | In this paper we revisit the relationship between institutions, human capital and development. We argue that empirical models that treat institutions and human capital as exogenous are misspecified both because of the usual omitted variable bias problems and because of differential measurement error in these variables, and that this misspecification is at the root of the very large returns of human capital, about 4 to 5 times greater than that implied by micro (Mincerian) estimates, found in some of the previous literature. Using cross-country and cross-regional regressions, we show that when we focus on historically-determined differences in human capital and control for the effect of institutions, the impact of institutions on long-run development is robust, while the estimates of the effect of human capital are much diminished and become consistent with micro estimates. Using historical and cross-country regression evidence, we also show that there is no support for the view that differences in the human capital endowments of early European colonists have been a major factor in the subsequent institutional development of these polities. |
| JEL: | I25 O10 P16 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19933&r=hpe |
| By: | DANILO FREITAS RAMALHO DA SILVA |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:009&r=hpe |
| By: | Eric Tymoigne |
| Abstract: | One of the main contributions of Modern Money Theory (MMT) has been to explain why monetarily sovereign governments have a very flexible policy space that is unconstrained by hard financial limits. Not only can they issue their own currency to pay public debt denominated in their own currency, but they can also easily bypass any self-imposed constraint on budgetary operations. Through a detailed analysis of the institutions and practices surrounding the fiscal and monetary operations of the treasury and central bank of the United States, the eurozone, and Australia, MMT has provided institutional and theoretical insights into the inner workings of economies with monetarily sovereign and nonsovereign governments. The paper shows that the previous theoretical conclusions of MMT can be illustrated by providing further evidence of the interconnectedness of the treasury and the central bank in the United States. |
| Keywords: | Modern Money Theory; Monetary Policy; Fiscal Policy |
| JEL: | E02 E42 E52 E62 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_788&r=hpe |
| By: | EDUARDO DA MOTTA E ALBUQUERQUE |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:002&r=hpe |
| By: | Pierre van der Eng |
| Abstract: | Macro-economic measurement goes back to the 17th century and became common practice in Western countries since the late-19th century. Since then, the growth and composition of some of the largest economies in Asia, particularly India and Japan, was also probed. And since the 1940s government agencies in many Asian countries were given responsibility for the development and implementation of consistent national accounting practices to assist in the planning of economic development. While this was in principle also the case in Indonesia in the 1950s, it took into the 1970s before consistent processes of macroeconomic measurement were put in place that facilitated the analysis of long-term economic growth. This paper asks why there was a delay. It finds that institutional discontinuities and limited resources prevented the establishment of consistent and well defined national accounting practices until the late-1970s. |
| Keywords: | national accounts, economic growth, Indonesia |
| JEL: | B41 E01 N15 O11 O47 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:auu:hpaper:024&r=hpe |
| By: | PEDRO GARCIA DUARTE |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:010&r=hpe |
| By: | Jordi Brandts; David J. Cooper; Roberto A. Weber |
| Abstract: | We study the effectiveness of leaders for inducing coordinated organizational change to a more efficient equilibrium, i.e., a turnaround. We compare communication from leaders to incentive increases and also compare the effectiveness of randomly selected and elected leaders. While all interventions yield shifts to more efficient equilibria, communication from leaders has a greater effect than incentives. Moreover, leaders who are elected by followers are significantly better at improving their group's outcome than randomly selected ones. The improved effectiveness of elected leaders results from sending more performance-relevant messages. Our results are evidence that the way in which leaders are selected affects their legitimacy and the degree to which they influence followers. Finally, we observed that a combination of factors- incentive increases and elected leaders-yield near universal turnarounds to full efficiency. |
| Keywords: | Leadership, Job Selection, Coordination Failure,Experiments, Communication |
| JEL: | C72 C92 D83 |
| Date: | 2014–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:aub:autbar:947.14&r=hpe |
| By: | Timothy N. Bond; Kevin Lang |
| Abstract: | We show that, without strong auxiliary assumptions, it is impossible to rank groups by average happiness using survey data with a few potential responses. The categories represent intervals along some continuous distribution. The implied CDFs of these distributions will (almost) always cross when estimated using large samples. Therefore some monotonic transformation of the utility function will reverse the ranking. We provide several examples and a formal proof. Whether Moving-to-Opportunity increases happiness, men have become happier relative to women, and an Easterlin paradox exists depends on whether happiness is distributed normally or log-normally. We discuss restrictions that may permit such comparisons. |
| JEL: | D6 I3 N3 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19950&r=hpe |
| By: | MARCO ANTONIO RIBAS CAVALIERI |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:016&r=hpe |
| By: | ROGÉRIO ARTHMAR |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:003&r=hpe |
| By: | MARCIO ALVARENGA JUNIOR; FERNANDO AUGUSTO MANSOR DE MATTOS |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:031&r=hpe |
| By: | Peter Koudijs; Hans-Joachim Voth |
| Abstract: | What determines risk-bearing capacity and the amount of leverage in financial markets? Using unique archival data on collateralized lending, we show that personal experience can affect individual risk-taking and aggregate leverage. When an investor syndicate speculating in Amsterdam in 1772 went bankrupt, many lenders were exposed. In the end, none of them actually lost money. Nonetheless, only those at risk of losing money changed their behavior markedly – they lent with much higher haircuts. The rest continued as before. The differential change is remarkable since the distress was public knowledge. Overall leverage in the Amsterdam stock market declined as a result. |
| JEL: | G01 G02 G12 G21 G32 N2 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19957&r=hpe |
| By: | LUIZ FELIPE BRUZZI CURI; ALEXANDRE MACCHIONE SAES |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:009&r=hpe |