nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2015‒05‒16
fourteen papers chosen by
Erik Thomson
University of Manitoba

  1. Game theory: noncooperative games By van Damme, E.E.C.
  2. Socialist Calculation and Market Socialism By Jael, Paul
  3. Théorie des élites parétienne et moment machiavélien comme principes explicatifs de la dynamique sociale : les limites de la méthode des approximations successives By Claire Baldin; Ludovic Ragni
  4. Marx, the notebooks on the crisis of 1866 and structural changes in capitalism: investigating financial innovation and stock exchanges By João Antonio de Paula; Hugo Eduardo da Gama Cerqueira; Leonardo Gomes de Deus; Carlos Eduardo Suprinyak; Eduardo da Motta e Albuquerque
  5. Is Publication in the Hands of Outstanding Scientists? A Study on the Determinants of Editorial Boards Membership in Economics By Raffaele Miniaci; Michele Pezzoni
  6. Génesis, desarrollo e impacto de la eficiencia marginal del capital en teorías ecónómicas no keynesianas. By Cristhian Alejandro Cruz Moreno
  7. Changing Income Inequality and Panel Income Changes By Duval Hernández, Robert; Fields, Gary S.; Jakubson, George H.
  8. The Decimation and Displacement of Development Economics By Bengi Akbulut; Fikret Adaman; Yahya M. Madra
  9. The Career Effects of Scandal: Evidence from Scientific Retractions By Pierre Azoulay; Alessandro Bonatti; Joshua L. Krieger
  10. Making Sense of the Elusive Paradigm of Entrepreneurship By David, Audretsch; Donald, Kuratko; Albert, Link
  11. On the Relationship between Lifestyle and Happiness in the UK By Gschwandtner, Adelina; Jewell, Sarah L.; Kambhampati, Uma
  12. What Role Should Big Ideas Play in Science Curricula? By Richard S. Prawat
  13. Click'n'Roll: No Evidence of Illusion of Control By Filippin, Antonio; Crosetto, Paolo
  14. Financing the Capital Development of the Economy: A Keynes-Schumpeter-Minsky Synthesis By Mariana Mazzucato; L. Randall Wray

  1. By: van Damme, E.E.C. (Tilburg University, School of Economics and Management)
    Date: 2015
  2. By: Jael, Paul
    Abstract: This paper focuses on the debate held in the twenties and thirties of the last century between libertarian economists and socialist economists, following the denial by the first ones of the feasibility of a socialist economy. This controversy is well known to specialists and has been widely commented. It seemed to me useful to initiate non-specialists in an original way: by having the controversy speaking by itself. We review the main contributions and summarise their arguments with, initially, the bare minimum of personal comments. Walrasian general equilibrium serves as a reference for the defenders of market socialism in the controversy. But the concept of competition behind this theory is very incomplete; it is purely passive. It follows that the market socialism which emanates from it is not really a MARKET socialism. It is lacking the competition which innovates. Markets for capital goods are also lacking in theses models. Our paper then turns to a new generation of socialist models involving this real competition. We review two models proposed by Bardhan and Roemer and then exhibit a personal model. This type of model is facing a modern criticism whose central concept is the "soft budget constraint".
    Keywords: planning; market socialism; socialist calculation; soft budget constraint; Barone; von Mises; Hayek; Lange; Roemer
    JEL: P20 P21 P27
    Date: 2015–05
  3. By: Claire Baldin (University of Nice Sophia Antipolis, France; GREDEG CNRS); Ludovic Ragni (University of Nice Sophia Antipolis, France; GREDEG CNRS)
    Abstract: Cet article explique comment la dynamique de l’équilibre social chez Pareto repose sur le principe de rupture du moment machiavélien. Il resitue ce principe en termes d’équilibre entre virtù et fortuna puis en apprécie la transposition à l’étude de la dynamique de l’équilibre social parétien. Après avoir réévalué la méthode des approximations successives et de synthèse à laquelle Pareto recourt, nous montrons que le principe de rupture du moment machiavélien implique que l’explication de la dynamique sociale repose sur des lois tendancielles qui supposent de remettre en cause la synthèse des résultats de Pareto.
    Keywords: Pareto, Machiavel, méthodologie, histoire de la pensée économique
    JEL: B13 B15 B41 Z00
    Date: 2015–05
  4. By: João Antonio de Paula (Cedeplar-UFMG); Hugo Eduardo da Gama Cerqueira (Cedeplar-UFMG); Leonardo Gomes de Deus (UFOP); Carlos Eduardo Suprinyak (Cedeplar-UFMG); Eduardo da Motta e Albuquerque (Cedeplar-UFMG)
    Abstract: Marx's Notebooks prepared in 1868 and 1869 (excerpts from The Economist and The Money Market Review) are an investigation on the crisis of 1866. Beyond a broad study of that crisis, they are an investigation of an emerging transformation of capitalism. They focus on leading industrial sectors (railways), financial innovations (such as limited liability firms and new types of shares and titles), and follow political measures undertaken in response to that crisis - dynamic new features of a system in its drive for survival. Those Notebooks might be material for a deep revision of his unfinished manuscripts for Volume III.
    Keywords: Karl Marx; MEGA; financial innovation; phases of capitalism
    JEL: B14 B31
    Date: 2015–05
  5. By: Raffaele Miniaci (University of Brescia); Michele Pezzoni (University of Nice Sophia Antipolis, France; GREDEG CNRS)
    Abstract: This paper aims at casting light on editorial boards of leading journals in economics. This topic has been largely neglected by economists and sociologists of science, although the crucial role played by editors of prestigious journals in steering the discipline. We start our analysis by mapping the content specialization and the level of oligopoly of the contributing institutions within each journal. Then, we assess the impact of editorial boards’ interlocking and turnover on similarity between journals. In the second half of the paper we investigate the determinants of editorial board membership in leading economic journals during the decade from 1994 to 2004. We observe that the scientist’s past productivity is a strong predictor of membership. Nevertheless, other determinants are at play. Among others, we found a significant positive effect of scientist’s social connections with the members of the discipline who are entitled to decide for the appointment as editor.
    Keywords: Economic Journals, Journal interlocking and turnover, Social connection, Editor recruitment
    JEL: B21 B40 B53 C72 D01 D11 D50
    Date: 2015–05
  6. By: Cristhian Alejandro Cruz Moreno
    Abstract: Esta propuesta de ensayo contempla la posibilidad de contrastar la posición keynesiana sobre ciclos económicos con algunos contrapesos históricos. Particularmente se busca comprobar la aceptación, o no, del concepto de Eficiencia Marginal del Capital por parte de algunos pares teóricos de Keynes. Para ello se hará una revisión literaria que advierta la mayor cantidad de conexiones – ya sea a favor o en contra – entre la teoría keynesiana y otras escuelas económicas. La breve revisión histórica toma elementos de la economía clásica; luego se revisan otras posiciones teóricas contemporáneas a Keynes para terminar con algunos aportes neoclásicos. En ese orden de ideas, se podrán presentar algunos aportes de autores como Marshall, Mitchell, Hicks y Lucas. Se concluirá que no existe consenso, ni mucho menos beneplácito, sobre la teoría sobre ciclos de Keynes en las escuelas de pensamiento económico más modernas. Particularmente, se reconocerá y expondrá las diferencias entre unas teorías sobre ciclos donde prima la inestabilidad – caso de Keynes –, por otras donde se asegura la trayectoria hacia un equilibrio de parte del sistema económico.
    Keywords: keynesianismo, ciclo económico, Eficiencia Marginal del Capital, equilibrio.
    JEL: B12 B20
    Date: 2014–06–26
  7. By: Duval Hernández, Robert (University of Cyprus); Fields, Gary S. (Cornell University); Jakubson, George H. (Cornell University)
    Abstract: When economic growth (or economic decline) takes place, who benefits and who is hurt how much? The more traditional way of answering this question is to compare two or more comparable cross sections and gauge changing income inequality among countries or individuals. A newer way is to utilize data on a panel of countries or a panel of people and assess the pattern of panel income changes. How do these two approaches relate to one another? This paper shows, first, that it is possible to have all four combinations – rising or falling inequality and divergent or convergent panel income changes, and second, under what conditions, for various measures of rising/falling inequality and various measures of divergent/convergent income changes, each of the four possible combinations can arise.
    Keywords: income inequality, economic mobility
    JEL: J31 D63
    Date: 2015–04
  8. By: Bengi Akbulut; Fikret Adaman; Yahya M. Madra
    Date: 2015–01
  9. By: Pierre Azoulay; Alessandro Bonatti; Joshua L. Krieger
    Abstract: Scandals permeate social and economic life, but their consequences have received scant attention in the economics literature. To shed empirical light on this phenomenon, we investigate how the scientific community's perception of a scientist's prior work changes when one of his articles is retracted. Relative to non-retracted control authors, faculty members who experience a retraction see the citation rate to their articles drop by 10% on average, consistent with the Bayesian intuition that the market inferred their work was mediocre all along. We then investigate whether the eminence of the retracted author, and the publicity surrounding the retraction, shape the magnitude of the penalty. We find that eminent scientists are more harshly penalized than their less-distinguished peers in the wake of a retraction, but only in cases involving fraud or misconduct. When the retraction event had it source in "honest mistakes," we find no evidence of differential stigma between high- and low-status faculty members.
    JEL: O31 O33
    Date: 2015–05
  10. By: David, Audretsch (Indiana University); Donald, Kuratko (Indiana University); Albert, Link (University of North Carolina at Greensboro, Department of Economics)
    Abstract: The term “entrepreneurship” apparently means different things to different people including scholars and thought leaders. Because entrepreneurship is multifaceted, it is studied from many different perspectives, yet, that has fostered a multitude of definitions. Even the scholarly literature (where normally the deepest understanding would be found) is rife with disparities and even contradictions about what is and is not entrepreneurship. Some have suggested a narrower and more defined focus on entrepreneurship where only bona fide entrepreneurship research theories would explain entrepreneurial phenomena. We believe that constricting the field may the wrong approach. Our purpose then is to try and make sense of the disparate meanings and views of entrepreneurship prevalent in both the scholarly literature as well as among thought leaders in business and policy. We reconcile the seemingly chaotic and contradictory literature by proposing a coherent approach to structure the disparate ways that entrepreneurship is used and referred to in the scholarly literature. We examine three coherent strands of the entrepreneurship literature and identify an emerging eclectic view of entrepreneurship, which combines several of the views prevalent in the main approaches discussed.
    Keywords: Entrepreneurship; conceptual; behavioral; performance; eclectic
    JEL: L25 L26 L29
    Date: 2015–04–06
  11. By: Gschwandtner, Adelina; Jewell, Sarah L.; Kambhampati, Uma
    Abstract: In the present paper we attempt to analyse the relationship between ‘lifestyle’ and happiness in the UK using an instrumental variable approach. Our lifestyle variables have a significantly positive impact on happiness and the impact increases with the use of instruments. This suggests that a ‘healthy lifestyle’ has a positive impact on happiness and that any policy improving our lifestyle proxies would also make people happier in the UK.
    Keywords: Wellbeing, Life Satisfaction, Happiness, Nutrition, Exercise, Lifestyle, Instrumental Variables, Health Economics and Policy, Risk and Uncertainty, Teaching/Communication/Extension/Profession, D31, I31,
    Date: 2015–04
  12. By: Richard S. Prawat (Michigan State University)
    Abstract: This paper tells the story of the development of a science unit from a unique epistemological perspective—termed “realist constructivism.” The teacher in the realist constructivist approach is not expected to relinquish his or her expert status. Instead, that person adopts a stance, described in recent writings by one of the researchers as a “sage on the side” role that is mid-way between the traditional “sage on the stage” role and that of the inquiry-oriented “guide on the side” (Prawat, 2003). As this metaphor suggests, teachers in this approach play a more direct role than they do in the typical constructivist-oriented approach in science, social studies, and other disciplines. Reflecting this role, the approach can best be described as an “ideas first/inquiry second” variant on active teaching and learning. Data from implementation studies are presented that support this novel approach to science curricula development.
    Keywords: Education, Science, Technology
    JEL: I29
  13. By: Filippin, Antonio (University of Milan); Crosetto, Paolo (Université de Grenoble)
    Abstract: Evidence of Illusion of Control – the fact that people believe to have control over pure chance events – is a recurrent finding in experimental psychology. Results in economics find instead little to no support. In this paper we test whether this dissonant result across disciplines is due to the fact that economists have implemented only one form of illusory control. We identify and separately tests in an incentive-compatible design two types of control: a) over the resolution of uncertainty, as usually done in the economics literature, and b) over the choice of the lottery, as sometimes done in the psychology literature but without monetary payoffs. Results show no evidence of illusion of control, neither on choices nor on beliefs about the likelihood of winning, thus supporting the hypotheses that incentives crowd out illusion of control.
    Keywords: Illusion of Control, experiment, risk elicitation, hypothetical bias
    JEL: B49 C91 D81
    Date: 2015–04
  14. By: Mariana Mazzucato; L. Randall Wray
    Abstract: This paper discusses the role that finance plays in promoting the capital development of the economy, with particular emphasis on the current situation of the United States and the United Kingdom. We define both 'finance' and 'capital development' very broadly. We begin with the observation that the financial system evolved over the postwar period, from one in which closely regulated and chartered commercial banks were dominant to one in which financial markets dominate the system. Over this period, the financial system grew rapidly relative to the nonfinancial sector, rising from about 10 percent of value added and a 10 percent share of corporate profits to 20 percent of value added and 40 percent of corporate profits in the United States. To a large degree, this was because finance, instead of financing the capital development of the economy, was financing itself. At the same time, the capital development of the economy suffered perceptibly. If we apply a broad definition -to include technological advances, rising labor productivity, public and private infrastructure, innovations, and the advance of human knowledge- the rate of growth of capacity has slowed. The past quarter century witnessed the greatest explosion of financial innovation the world had ever seen. Financial fragility grew until the economy collapsed into the global financial crisis. At the same time, we saw that much (or even most) of the financial innovation was directed outside the sphere of production -to complex financial instruments related to securitized mortgages, to commodities futures, and to a range of other financial derivatives. Unlike J. A. Schumpeter, Hyman Minsky did not see the banker merely as the ephor of capitalism, but as its key source of instability. Furthermore, due to "financialisation of the real economy", the picture is not simply one of runaway finance and an investment-starved real economy, but one where the real economy itself has retreated from funding investment opportunities and is instead either hoarding cash or using corporate profits for speculative investments such as share buybacks. As we will argue, financialization is rooted in predation; in Matt Taibbi's famous phrase, Wall Street behaves like a giant, blood-sucking "vampire squid". In this paper we will investigate financial reforms as well as other government policy that is necessary to promote the capital development of the economy, paying particular attention to increasing funding of the innovation process. For that reason, we will look not only to Minsky's ideas on the financial system, but also to Schumpeter's views on financing innovation.
    Keywords: Banker as Ephor of Capitalism; Capital Development; Finance; Global Financial Crisis; Innovation; Minsky; Schumpeter
    Date: 2015–10–05

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