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on History and Philosophy of Economics |
| By: | Milanovic, Branko |
| Abstract: | The paper provides a detailed review of Thomas Piketty's book"Capital in the 21st century."It focuses on the new contributions of the book, and in particular on its unified treatment of economic growth, functional income distribution, and concentration of personal income. It concludes that Piketty's reinvigoration of classical and empircally-drven approach is likely to have a profound impact on economics. |
| Keywords: | Economic Theory&Research,Political Economy,Emerging Markets,Inequality,Poverty Impact Evaluation |
| Date: | 2014–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6974&r=hpe |
| By: | Hugo E. A. da Gama Cerqueira (Cedeplar-UFMG) |
| Abstract: | This paper discusses the attempts to publish a historical-critical edition of the works of Karl Marx, the Marx-Engels Gesamtausgabe (MEGA): the first one, which was led by David Riazanov in the 1920s and 1930s, and the second one, the MEGA2 project which begun in the 1970s and is still in course of publication. The paper presents these two editions and discusses their impact on the interpretation of Marxs economic and philosophical thought. |
| Keywords: | Karl Marx (1818-1883); Friedrich Engels (1820-1895); MEGA; marxology. |
| JEL: | A31 B14 B24 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:cdp:texdis:td506&r=hpe |
| By: | Ian Gough |
| Abstract: | Since climate change threatens human wellbeing across the globe and into the future, we require a concept of wellbeing that encompasses an equivalent ambit. This paper argues that only a concept of human need can do the work required. It compares need theory with three alternative approaches. Preference satisfaction theory is criticised on the grounds of subjectivity, epistemic irrationality, endogenous and adaptive preferences, the limitlessness of wants, the absence of moral evaluation, and the non-specificity of future preferences. The happiness approach is found equally wanting. The main section shows how these deficiencies can be addressed by a coherent theory of need. Human needs are necessary preconditions to avoid serious harm, are universalisable, objective, empirically grounded, non-substitutable and satiable. They are broader than 'material' needs since a need for personal autonomy figures in all theoretical accounts. While needs are universal, need satisfiers are most often contextual and relative to institutions and cultures. The satiability and non-substitutability of needs is critical for understanding sustainability. The capability approaches of Sen and Nussbaum are compared but argued to be less fundamental. Finally, human needs provide the only concept that can ground moral obligations across global space and intergenerational time and thus operationalise 'sustainable welfare'. |
| Keywords: | Human needs, welfare theory, wellbeing, global justice, intergenerational justice, sustainability, preferences, capabilities |
| JEL: | B5 I00 P46 Z13 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sticas:/182&r=hpe |
| By: | Sergio Beraldo (Università di Napoli Federico II and CSEF); Robert Sugden (School of Economics and Centre for Behavioural and Experimental Social Science, University of East Anglia) |
| Abstract: | This paper offers a new and robust model of the emergence and persistence of cooperation when interactions are anonymous, the population is well-mixed, and the evolutionary process selects strategies according to material payoffs. The model has a Prisoner’s Dilemma structure, but with an outside option of non-participation. The payoff to mutual cooperation is stochastic; with positive probability, it exceeds that from cheating against a cooperator. Under mild conditions, mutually beneficial cooperation occurs in equilibrium. This is possible because the non-participation option holds down the equilibrium frequency of cheating. The dynamics of the model are investigated both theoretically and through simulations. |
| Keywords: | Cooperation; voluntary participation; random payoffs |
| JEL: | C73 |
| Date: | 2014–07–18 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:368&r=hpe |
| By: | Basu, Kaushik |
| Abstract: | Ponzis are among the most ubiquitous and least understood phenomena of economic life. They acquired a certain salience with the global financial crisis of 2008 and the crash of Bernie Madoff’s celebrated Ponzi scheme. This paper explains the structure of Ponzi schemes and goes on to argue that what makes this such a troubling phenomenon is its ability to be camouflaged amidst legitimate practices. It is shown, for instance, that the common practice of giving stock options to employees could be a potential Ponzi that allows corporations to flourish for a while by borrowing from its own future. The paper goes on to discuss the need for intelligent regulation to incise harmful Ponzis (not all Ponzis are harmful) while taking care not to damage other legitimate activities that surround them. |
| Keywords: | Debt Markets,Access to Finance,Emerging Markets,Markets and Market Access,Economic Theory&Research |
| Date: | 2014–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6967&r=hpe |
| By: | Elise van Nederveen Meerkerk |
| Abstract: | This paper investigates developments in labour policies and social norms on gender and work from the perspective of colonial entanglements. At the beginning of the nineteenth century, work was seen a means to morally discipline the poor, both in the Netherlands and the Netherlands Indies. A prime example are the initiatives by Johannes van den Bosch, who first in 1818 established 'peat colonies(!)' in the Netherlands, where the urban poor were transported to become industrious agrarian workers. In 1830, the same Van den Bosch introduced the Cultivation System in the Netherlands Indies, likewise, to increase Javanese peasants' industriousness. During the nineteenth century, ideals and practices of the male breadwinner started to pervade Dutch working-class households, and child and women's labour laws were issued. Instead, legislation in the Netherlands Indies was introduced very late and under heavy pressure of the international community. Not only did Dutch politicians consider it 'natural' that Indonesian women and children worked. What is more, they presented the inherent differences between Indonesian and Dutch women as legitimation for the protection of the latter: a fine example of what Ann Stoler and Frederick Cooper have called a 'grammar of difference'. |
| Keywords: | Social policy, Women's work, Child labour, Colonial history, Labour relations. |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:ucg:wpaper:0058&r=hpe |
| By: | Kehrwald, Bernie |
| Abstract: | This paper introduces a new monetary theory. A simple model is described in which a central bank sets the interest rate in a way that the excess demand for credits equals the preferred amount of money. It is compatible with the Keynesian liquidity preference theory and the neoclassical loanable funds theory and can be used to explain a series of phenomena. It is very suitable for introductory textbooks. |
| Keywords: | money, interest rate, credit, central bank, savings, investments |
| JEL: | E40 E50 E51 |
| Date: | 2014–07–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57603&r=hpe |
| By: | Keuschnigg, Marc; Wolbring, Tobias |
| Abstract: | Adding to the debate about the “broken windows” thesis we discuss an explanation of minor norm violation based on the assumption that individuals infer expected sanctioning probabilities from contextual cues. We modify the classical framework of rational crime by signals of disorder, local social control, and their interaction. Testing our implications we present results from three field experiments showing that violations of norms, which prevent physical as well as social disorder, foster further violations of the same and of different norms. Varying the net gains from deviance it shows that disorder effects are limited to low cost situations. Moreover, we provide suggestive evidence that disorder effects are significantly stronger in neighborhoods with high social capital. |
| Keywords: | broken windows theory; disorder; field experiment; low cost situations; norm violation; social capital |
| JEL: | C9 C93 K42 R23 Z13 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57534&r=hpe |
| By: | Currie-Alder, Bruce; Kanbur, Ravi; Malone, David M.; Medhora, Rohinton |
| Keywords: | International Development, Production Economics, |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cudawp:180073&r=hpe |
| By: | Ran Spiegler (Tel Aviv University, Eitan Berglas School of Economics; Centre for Macroeconomics (CFM)) |
| Abstract: | I present a framework for analyzing decision makers with an imperfect understanding of their environment’s correlation structure. The decision maker faces an objective multivariate probability distribution (his own action is one of the random variables). He is characterized by a directed acyclic graph over the set of variables. His subjective belief filters the objective distribution through his graph, via the factorization formula for Bayesian networks. This belief distortion implies that the decision maker’s long-run behavior may affect his perception of the consequences of his actions. Accordingly, I define a "personal equilibrium" notion of optimal choices. I show how recent models of boundedly rational expectations (as well as new ones, e.g. reverse causality) can be subsumed into this framework as special cases. Some general properties of the Bayesian-network representation of subjective beliefs are presented, as well as a "missing data" foundation. |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:cfm:wpaper:1417&r=hpe |
| By: | Giovanna d’Adda; Donja Darai; Roberto A. Weber |
| Abstract: | We study whether leaders influence the unethical conduct of followers. To avoid selection issues present in natural environments, we use a laboratory experiment in which we form groups and assign leadership roles at random. We study an environment in which groups compete, with dishonest behavior enhancing group earnings to the detriment of social welfare. We vary, by treatment, two instruments through which leaders can influence follower conduct—prominent statements to the group and the allocation of monetary incentives. In general, the presence of active group leaders gives rise to significantly more dishonest behavior. Moreover, appointing leaders who are likely to have acted dishonestly in a preliminary stage of the experiment yields groups with significantly more unethical conduct. The analysis of leaders’ strategies reveals that leaders’ statements have a stronger effect on follower behavior than the ability to distribute financial rewards, and that leaders’ propensity to act dishonestly correlates with their use of statements or incentives as a means for encouraging dishonest follower conduct. |
| Keywords: | Leadership, ethics, dishonesty, experiment |
| JEL: | C92 C72 D03 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:167&r=hpe |
| By: | Oana Borcan; Ola Olsson; Louis Putterman |
| Abstract: | All since the rise of the first civilizations, economic development has been closely intertwined with the evolution of states. In this paper, we contribute to the literature on state history and long-run economic development in four ways. First, we extend and complete the state history index from Bockstette, Chanda and Putterman (2002) by coding the experience with states from the first state origins, 3500 BCE, up until 2000 CE. Second, we explore empirically the relationship between time since transition to agriculture and state age, as well as subsequent state history. Our estimated unconditional correlation implies that a 1000 year earlier transition to agriculture is associated with a 470 years earlier emergence of state institutions. We show how this relationship differs between indigenously- and externally- originated states. Third, we show that the relationship between our extended state history index and current levels of economic development has the shape of an inverted u. The results reflect the fact that countries that were home to the oldest states, such as Iraq, Egypt and China, are poorer today than younger inheritors of their civilizations, such as Germany, Denmark and Japan. This pattern was already in place by 1500 CE and is robust to adjusting for migrations during the colonial era. Finally, we demonstrate a very close relationship between state formation and the adoption of writing. |
| Keywords: | State history, comparative development |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:bro:econwp:2014-8&r=hpe |