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on History and Philosophy of Economics |
| By: | Zsinka, László |
| Abstract: | Jenő Szűcs wrote his essay entitled Sketch on the three regions of Europe in the early 1980s in Hungary. During these years, a historically well-argued opinion emphasising a substantial difference between Central European and Eastern European societies was warmly received in various circles of the political opposition. In a wider European perspective Szűcs used the old “liberty topos” which claims that the history of Europe is no other than the fulfillment of liberty. In his Sketch, Szűcs does not only concentrate on questions concerning the Middle Ages in Western Europe. Yet it is this stream of thought which brought a new perspective to explaining European history. His picture of the Middle Ages represents well that there is a way to integrate all typical Western motifs of post-war self-definition into a single theory. Mainly, the “liberty motif”, as a sign of “Europeanism” – in the interpretation of Bibó’s concept, Anglo-saxon Marxists and Weber’s social theory –, developed from medieval concepts of state and society and from an analysis of economic and social structures. Szűcs’s historical aspect was a typical intellectual product of the 1980s: this was the time when a few Central European historians started to outline non-Marxist aspects of social theory and categories of modernisation theories, but concealing them with Marxist terminology. |
| Keywords: | liberty topos, eurocentrism, structure analysis |
| JEL: | N01 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:cvh:coecwp:2014/08&r=hpe |
| By: | Sanchari Goswami; Anirban Chakraborti |
| Abstract: | In this article, we briefly review the different aspects and applications of kinetic exchange models in economics and sociology. Our main aim is to show in what manner the kinetic exchange models for closed economic systems were inspired by the kinetic theory of gas molecules. The simple yet powerful framework of kinetic theory, first proposed in 1738, led to the successful development of statistical physics of gases towards the end of the 19th century. This framework was successfully adapted to modeling of wealth distributions in the early 2000's. In later times, it was applied to other areas like firm dynamics and opinion formation in the society, as well. We have tried to present the flavour of the several models proposed and their applications, intentionally leaving out the intricate mathematical and technical details. |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1408.1365&r=hpe |
| By: | Pintér, Miklós |
| Abstract: | Meier (2012) gave a "mathematical logic foundation" of the purely measurable universal type space (Heifetz and Samet, 1998). The mathematical logic foundation, however, discloses an inconsistency in the type space literature: a finitary language is used for the belief hierarchies and an infinitary language is used for the beliefs. In this paper we propose an epistemic model to fix the inconsistency above. We show that in this new model the universal knowledgebelief space exists, is complete and encompasses all belief hierarchies. Moreover, by examples we demonstrate that in this model the players can agree to disagree Aumann (1976)'s result does not hold, and Aumann and Brandenburger (1995)'s conditions are not sufficient for Nash equilibrium. However, we show that if we substitute selfevidence (Osborne and Rubinstein, 1994) for common knowledge, then we get at that both Aumann (1976)'s and Aumann and Brandenburger (1995)'s results hold. |
| Keywords: | Incomplete information game, Agreeing to disagree, Nash equilibrium, Epistemic game theory, Knowledge-belief space, Belief hierarchy, Common knowledge, Self-evidence, Nash equilibrium |
| JEL: | C70 C72 D80 D82 D83 |
| Date: | 2014–04–18 |
| URL: | http://d.repec.org/n?u=RePEc:cvh:coecwp:2014/02&r=hpe |
| By: | José Gabriel Palma |
| Abstract: | Latin America is a region whose critical social imagination has stalled, changing from a uniquely prolific period during the 1950s and 1960s — revolving around structuralism, ‘dependency analyses’, Baran and Sweezy’s-type analysis of ‘monopoly capitalism’, French structuralism, the German Historical School, Keynesian and macroeconomics, and the ideas of endogenous intellectuals (such as Mariátegui) — to an intellectually barren one since the 1982 debt crisis and the fall of the Berlin Wall. Although this has happened in most of the world, in Latin America both the process of re-legitimisation of capital, and the downswing of the cycle of critical thinking have been particularly pronounced as neo-liberalism has conquered the region, including most of its progressive intelligentsia, just as completely (and just as fiercely) as the Holy Inquisition conquered Spain — transforming critical thinkers into an endangered species. As pre-1980 critical analytical work had been characterised by an unremitting critique of the economy, once the mainstream left conceded the economy as the fundamental hub of the struggle, there seemed to have been little else left in terms of basic ideological principles to hold onto in a thoughtful way — i.e., it was as if the mainstream left had lost not just some but all its ideological relevance, making it particularly difficult for them to move forward in an innovative way. As a result, in terms of development strategies and economic policies both the traditional and the ‘new-left’ are in one way or another still stuck in the past. While in some countries the former basically wants to recreate the past, in others the latter seems to be unable to do anything more imaginative than to attempt to create a future which is simply the exact opposite of that past — the main guiding economic policy principle being to transform practically anything that before was considered “virtue” into “vice”, and vice-versa. This narrow ‘reverse-gear’ attitude of the ‘new-left’ has delivered not only a disappointing economic performance (particularly in terms of productivity-growth), but also rather odd political settlements characterised by a combination of an insatiable capitalist elite, a captured and unimaginative progressive political élite (the dominant classes are quite happy to let them govern as long as they do not forget who they are), passive citizens, and a stalled social imagination — a dull mélange that from time to time is sparked off by spontaneous outbursts of students’ discontent. Meanwhile, the world (with its new technological and institutional paradigms) moves on, and Asia forges ahead. |
| Keywords: | Latin America, Ideology, Critical Thinking, Structuralism, Dependency,Neoliberalism,Fundamentalism, ‘New Left’, Top 1%, Keynes, Foucault, Prebisch, Hirschman. |
| JEL: | B5 D3 E2 F13 F59 J20 L52 N16 N36 O16 O4 P5 |
| Date: | 2014–06–19 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1416&r=hpe |
| By: | Theodore R. Breton |
| Abstract: | In 1960 Theodore Schultz expounded a human capital theory of economic growth that includes three elements: 1) Countries without much human capital cannot manage physical capital effectively, 2) Economic growth can only proceed if physical capital and human capital rise together, and 3) Human capital is the factor most likely to limit growth. I specify Schultz’s theory mathematically and test it in periods when global financial capital was highly mobile. I find that in 1870, 1910, and 2000, the average schooling attainment of the adult population largely determined the stock of physical capital/capita and GDP/capita in 42 market economies. |
| Keywords: | Human Capital, Schooling, Capital Investment, Economic Growth, Solow Model, Market Economies |
| JEL: | E13 I21 O11 O15 O41 |
| Date: | 2014–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:col:000122:011999&r=hpe |
| By: | Jordi Brandts; Christina Rott; Carles Solà |
| Abstract: | We conduct a laboratory experiment to study how, after a history of decay, cooperation in a repeated voluntary contribution game can be revived in an enduring way. Simply starting the repeated game over - a simple fresh start - leads to an initial increase of cooperation, but to a subsequent new decay. Motivated by cooperation decay in organizations we study the potential of three interventions of triggering higher and sustained cooperation taking place at the same time as a restart. Surprisingly, we find that the detailed explanation of the causes of the decay in cooperation from Fischbacher and Gaechter (2010) combined with an advice on how to prevent decay do not have an effect beyond that of just starting over. In contrast, a one-way free form communication message sent by the leader to the followers strongly revives cooperation. Repeated free form communication by the leader further strengthens the reviving effect on cooperation. Combining the two previous interventions does not outperform the pure effect of communication. Our content analysis reveals that leader communication is more people oriented and less formal than the expert advice. |
| Keywords: | leadership, cooperation, communication |
| JEL: | C71 C73 C92 D83 J63 L20 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:775&r=hpe |
| By: | Barros, Gustavo |
| Abstract: | In February 1931, Getúlio Vargas delivered a well known speech in Belo Horizonte and made then one of his most important public interventions in the Brazilian steel-making debate. This speech made fortune in the historiography, above all for its incisive statement in favor of a national steel-making industry and, by extension, of industry in general, few months after the Revolution of 1930. We discuss and interpret here this speech, alongside with a comparison between what was defended in the speech and the steel-making policy which effectively followed it along the first Vargas government, but before the Estado Novo. We try to understand the reasons which led Vargas to state what he did about the steel-making problem, at that moment in Belo Horizonte, based on the history of the debate until then, on the position which the state of Minas Gerais occupied in it and on other propositions made by Vargas on the same occasion. Regarding the steel-making policy actually implemented by the government after the speech, we conclude that, if it was not nonexistent, we must at least consider it as disappointing, if compared to the expectations which the vehemence of his 1931 speech could give rise to. |
| Keywords: | Brazil; Getúlio Vargas; industrialization; steel-making; iron ore export; industrial policy |
| JEL: | N56 N66 O14 O25 |
| Date: | 2014–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57656&r=hpe |
| By: | Roy, Tirthankar (London School of Economics) |
| Abstract: | The historiography of the development and diffusion of technology in the modern world has grown as a collection of discourses, which differ in points of emphasis. The three common points of emphasis are state intervention, cultural makeup of societies, and economic calculations. The disjointedness characterizes the literature on colonial India (1857-1947) as well, complicated further by the need to understand the role that British colonial rule played in these processes. The present survey discusses, compares, and evaluates the diverse narratives. |
| Keywords: | Colonial India, Technology |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:198&r=hpe |
| By: | Piper, Alan T. |
| Abstract: | This investigation discusses and employs dynamic panel analysis to provide new insights into the concept of happiness, and particularly its dynamics. Arguments are advanced for its use both in terms of the advantages such analysis offers, and also because it takes into account dynamics omitted by more standard panel data estimation methods like fixed effects. Using the British Household Panel Survey, it is demonstrated that happiness is largely (but not wholly) contemporaneous. This helps to provide explanations for previous findings, inform the adaptation discussion, and generate new understanding regarding well-being. An event – no matter when entered into - must have a contemporaneous impact on either the life of an individual or an individual’s perception of their life (or both) for it to be reflected in self-reported life satisfaction scores. Similarly, this contemporaneous finding also explains other results in the literature about the well-being legacy of events. |
| Keywords: | Life Satisfaction, Dynamic Panel Analysis, GMM, Adaptation, Happiness |
| JEL: | I31 J12 J64 |
| Date: | 2014–08–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57778&r=hpe |
| By: | Sheremeta, Roman |
| Abstract: | The standard theoretical description of rent-seeking contests is that of rational individuals or groups engaging in socially inefficient behavior by exerting costly effort. Experimental studies find that the actual efforts of participants are significantly higher than predicted in the models based on rational behavior and that over-dissipation of rents (or overbidding or over-expenditure of resources) can occur. Although over-dissipation cannot be explained by the standard rational-behavior theory, it can be explained by incorporating behavioral dimensions into the standard model, such as (1) the utility of winning, (2) relative payoff maximization, (3) bounded rationality, and (4) judgmental biases. These explanations are not exhaustive but provide a coherent picture of important behavioral dimensions to be considered when studying rent-seeking behavior in theory and in practice. |
| Keywords: | rent-seeking, contests, experiments, overbidding, over-dissipation |
| JEL: | C72 C91 C92 D72 D74 |
| Date: | 2014–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57751&r=hpe |
| By: | Proto, Eugenio (The University of Warwick); Oswald, Andrew J. (The University of Warwick) |
| Abstract: | This paper examines a famous puzzle in social science. Why do some nations report such high happiness? Denmark, for instance, regularly tops the league table of rich nations’ well-being; Great Britain and the US enter further down; France and Italy do relatively poorly. Yet the explanation for this ranking one that holds even after adjustment for GDP and socio-economic and cultural variables remains unknown. We explore a new avenue. Using data on 131 countries, we cautiously document a range of evidence consistent with the hypothesis that certain nations may have a genetic advantage in well-being. |
| Keywords: | Happiness |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:196&r=hpe |
| By: | Zaifu Yang; Rong Zhang |
| Abstract: | We develop a new model of addictive behavior that takes as a starting point the classic rational addiction model of Becker and Murphy, but incorporates uncertainty. We model uncertainty through the Wiener stochastic process. This process captures both random events such as anxiety, tensions and environmental cues which can precipitate and exacerbate addictions, and those sober and thought-provoking episodes that discourage addictions. We derive closed-form expressions for optimal (and expected optimal) addictive consumption and capital trajectories and examine their global and local properties. Our theory provides plausible explanations of several important patterns of addictive behavior, and has novel implications for addiction control policy. |
| Keywords: | Rational Addiction; Stochastic Control; Uncertainty |
| JEL: | C61 D01 D11 I10 I18 K32 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:yor:yorken:14/12&r=hpe |
| By: | Jellal, Mohamed |
| Abstract: | We consider a model of open economy with a culture of spirit of capitalism. As a first step, we show that the entry of foreign capital flows can support an endogenous economic growth of the host country. Further, our model shows a positive correlation between the entry of foreign direct investment and economic growth. The entry of foreign capital depends on both the quality of institutions as the quality of education and national culture of the host country. In particular, we show that the countries with strong culture of wealth accumulation attract more foreign investments that accelerated the pace of economic growth leading to a self sustaining virtuous circle. Our theoretical model can explain the miracle of the economic success of some Asian countries |
| Keywords: | The Spirit of Capitalism ,Wealth Accumulation, Open Economy,Foreign Capital, Endogenous Growth, Asian Countries |
| JEL: | A13 F21 F23 F41 O43 Z1 Z12 Z13 |
| Date: | 2014–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57777&r=hpe |
| By: | Cordero, Jose M.; Salinas-Jiménez, Javier; Salinas-Jiménez, Mª Mar |
| Abstract: | In this paper we propose an innovative approach based on life satisfaction to estimate efficiency measures for individuals considering how they convert their resources into higher levels of happiness. We use an extension of the conditional nonparametric robust approach which allows us to consider a mixed set of individual and institutional variables that can affect the levels of life satisfaction. Our empirical analysis includes data about 31,854 individuals from 26 OECD countries participating in the last wave of the World Values Survey. Results obtained indicate that the most efficient individuals in achieving happiness tend to live in northern and central European countries whereas the less efficient individuals are found, in average, in Asian transitional economies. In addition, it is also found that most of the traditional determinants of wellbeing (e.g. age, marital status, religion or unemployment) also have a significant impact on efficiency measures. |
| Keywords: | Efficiency, Happiness, Cross-country analysis, nonparametric |
| JEL: | C14 I30 |
| Date: | 2014–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57784&r=hpe |
| By: | Christensen, Jens H.E. (Federal Reserve Bank of San Francisco); Krogstrup, Signe (Swiss National Bank) |
| Abstract: | In August 2011, the Swiss National Bank engaged in unconventional monetary policy through an unprecedented expansion of bank reserves. As these actions did not involve any outright long-term asset purchases, this unique episode allows for novel insights on the transmission mechanism of central bank balance sheet expansions to interest rates. Analysis of the response of Swiss bond yields to announcements regarding this program suggests that expansion of reserves by itself can lower long-term yields through a portfolio balance effect. |
| JEL: | E43 E52 E58 G12 |
| Date: | 2014–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2014-18&r=hpe |