nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2015‒12‒28
nineteen papers chosen by
Erik Thomson
University of Manitoba

  1. D'un siècle à l'autre : salaire minimum, science économique et débat public aux Etats-Unis, en France et au Royaume-Uni (1890-2015) By Jérôme Gautié
  2. Robert Lucas and the Twist of Modeling Methodology. On some Econometric Methods and Problems in New Classical Macroeconomics By Francesco Sergi
  3. Ambiguity and Long-Run Cooperation By Marco Rojas Olivares; Damián Vergara Domínguez
  4. Das Komplexitätssyndrom: Gesellschaftliche 'Komplexität' als intellektuelle und politische Herausforderung in den 1970er-Jahren By Leendertz, Ariane
  5. Veblen, economic policy and the present crisis By Paolo Ramazzotti
  6. Dynamics of Socio-Economic systems: attractors, rationality and meaning By Andrzej Nowak; Jørgen Vitting Andersen; Wojciech Borkowski
  7. The Tale of Two Great Crises By Michele Fratianni; Federico Giri
  8. Work and Consumption in an Era of Unbalanced Technological Advance By Benjamin M. Friedman
  9. J. Habermas et l’« Agir communicationnel » By Yvon Pesqueux
  10. Shared economic thought and the neglect of social costs. Why progressive economists often stick to conventional wisdom By Paolo Ramazzotti
  11. Le nouvel ordre écologique de Luc Ferry – « écosophie » ou éthique de la responsabilité ? By Yvon Pesqueux
  12. Colonial Virginia’s Paper Money Regime, 1755-1774: a Forensic Accounting Reconstruction of the Data By Farley Grubb
  13. Piketty's Book and Macro Models of Wealth Inequality By Mariacristina De Nardi; Giulio Fella; Fang Yang
  14. A History of U.S. Debt Limits By George J. Hall; Thomas J. Sargent
  15. Political capitalism: The interaction between income inequality, economic freedom and democracy By Krieger, Tim; Meierrieks, Daniel
  16. La corruption : Fondements microéconomiques et Déterminents macroéconomiques By Mtiraoui, Abderraouf
  17. Professors and Bankers: Russia’S State Bank Charters of 1860 and 1894, Economic Expertise and Public Opinion By Igor A. Khristoforov
  18. Stages of Diversification: France, 1836-1938 By Stéphane Becuwe; Bertrand Blancheton; Christopher M. Meissner
  19. Obstfeld and Rogoff's International Macro Puzzles: A Quantitative Assessment By Jonathan Eaton; Samuel S. Kortum; Brent Neiman

  1. By: Jérôme Gautié (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The recent revival of the minimum wage debates is an incentive to recall their long history, which started at the end of the XIXth century. Three levels of analysis are combined here. The first one is the study of both the empirical and theoretical contents of the economic controversies. The second one is the analysis of the methodological, and beyond, epistemological issues at stake. Eventually, the third one relies on an historical sociology of science, focusing on the relations and interactions of the academic field with three other fields: the political field, the administrative field, and the field of the actors from civil society and the economic and social world. The study focuses on three countries: the United-States, France and the United-Kingdom (and its Commonwealth). Three key periods are distinguished: around World War I, the period from the 1940s to the 1980s, and the present period starting in the mid-1990s. From the history of the minimum wage debates, one can also learn about the evolution of labour economics, and beyond, the history of economics as a scientific discipline.
    Abstract: L'actualité renouvelée des controverses autour du salaire minimum invite à restituer celles-ci dans une histoire longue qui commence à la fin du XIXème siècle. Cette histoire est abordée ici en articulant trois niveaux d'analyse. Les deux premiers portent respectivement sur l'étude des contenus empiriques et théoriques des controverses économiques, et sur celle de leurs enjeux méthodologiques et même, au-delà, épistémologiques. Un troisième niveau d'analyse, selon une approche de sociologie historique des sciences, vise à recontextualiser les débats économiques en tenant compte des modes d'articulation de la sphère académique à trois autres sphères : la sphère politique, la sphère administrative, et la sphère de la société civile et du monde économique et social. A partir de l'expérience des Etats-Unis, de la France et du Royaume-Uni (et de son Commonwealth), trois grandes périodes sont distinguées - autour de la première guerre mondiale, des années 1940 aux années 1980, et enfin, du milieu des années 1990 à nos jours. Au-delà de la question du salaire minimum, l'histoire de ces débats éclaire sur l'évolution de l'économie du travail au cours de cette période, et dans une certaine mesure, sur celle de la science économique dans son ensemble.
    Keywords: Minimum wage,history of economic thought,rhetoric of economics,rhétorique économique,salaire minimum,histoire de la pensée économique
    Date: 2015–11
  2. By: Francesco Sergi (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The purpose of this contribution to the epistemology and history of recent macroeconomics is to construct a clear understanding of econometric methods and problems in New Classical macroeconomics. Most historical work have focused so far on theoretical or policy implication aspects of this research program set in motion by Robert Lucas in the early seventies. On the contrary, the empirical and econometric works of New Classical macroeconomics have received little attention. I focus especially on the contributions gathered in Rational Expectations and Econometric Practice, edited in 1981 by Lucas and Thomas Sargent. The main claim of this article is that the publication of this book must be regarded as a turn in macroeconomics, that would bring macroeconometric modeling methodology closer to Lucas's conception of models. The analysis of the New Classical macroeconometrics through the Lucas methodology allow us to propose an original historical account of the methods presented in Rational Expectations and Econometric Practice, but also of the problems that flawed this approach.
    Abstract: L'objectif de cette contribution à l'épistémologie et à l'histoire de la pensée économique est de proposer une compréhension claire des méthodes et des problèmes économétriques de la nouvelle macroéconomie classique. La plupart des travaux historiques à ce sujet se sont focalisés sur les aspects théoriques ou sur les implications de politique économique de ce programme de recherche, lancé par Robert Lucas au début des années soixante-dix. En revanche, le travail empirique et économétrique de la nouvelle macroéconomie classique a reçu peu d'attention par les historiens. L'article s'intéresse plus particulièrement aux contributions rassemblées dans Rational Expectations and Econometric Practice, ouvrage collectif de 1981 dirigé par Lucas et Thomas Sargent. La principale thèse de l'article est que la publication de ce livre entérine un tournant dans la modélisation macroéconométrique, en étroite résonance avec la conception méthodologique de Lucas sur les modèles. L'analyse de la macroéconométrie des nouveaux classiques par le prisme de la méthodologie lucasienne nous permet de proposer une vision historique originale des méthodes présentées dans Rational Expectations and Econometric Practice, tout comme des problèmes qui ont entravé le développement de cette approche.
    Keywords: history of macroeconomics,macroeconometrics,modeling methodology,histoire de la macroéconomie,Lucas (Robert),Sargent (Thomas),macroéconométrie,méthodologie et modélisation
    Date: 2015–11
  3. By: Marco Rojas Olivares; Damián Vergara Domínguez
    Abstract: This paper studies the effects of ambiguity on long-run cooperation, by analyzing the infinitely repeated Prisoner’s Dilemma and its application to Cournot’s duopoly model. We show that ambiguity decreases the likelihood of cooperation in the infinitely repeated Prisoner’s Dilemma, regardless the level of optimism. In the economic application, we find that ambiguity is positively related with static equilibrium quantities and negatively related with the probability of sustaining a tacit collusion, i.e. positively related with competition. In fact, the critical discount factor associated with the probability of achieving a collusive equilibrium can be even higher than one for some parametric combinations. Nevertheless, depending on the level of optimism, a discontinuity can arise when ambiguity is too high, emerging a situation where collusion can be implemented as a short-run equilibrium. That is due to the fact that, for some parametric combinations, the economic application stops being a particular case of the Prisoner’s Dilemma and start behaving as different games in which cooperation can be achieved as a short-run pure Nash equilibrium. Finally, an alternative interpretation suggests an equivalence result: a Cournot’s duopoly with high ambiguity and relatively pessimist players behaves as a coordination game with exogenous payoffs.
    Date: 2015–12
  4. By: Leendertz, Ariane
    Abstract: In den 1970er-Jahren begannen Soziologen und Politikwissenschaftler, einen analytischen Begriff von Komplexität zu entwickeln, indem sie aus der allgemeinen Systemtheorie und Kybernetik entnommene Konzepte in die Gesellschaftstheorie, Policy-Forschung und Politikberatung übertrugen. Gesellschaftliche 'Komplexität' war jedoch nicht allein ein Problem sozialwissenschaftlicher Theoriebildung, sondern wurde im Übergang von den 1960er- in die 1970er-Jahre zugleich als intellektuelles und politisches Problem 'entdeckt' und diskutiert: Der Begriff verbreitete sich simultan in Sozialwissenschaften, Politik und öffentlich-intellektuellen Debatten. Auch in den theoretischen Überlegungen wurde Komplexität nicht allein in einem streng analytischen Sinn, sondern als zeitdiagnostisches Schlagwort und Metapher verwendet. Vor dem Hintergrund historiografischer Debatten über Entwicklungen im letzten Drittel des 20. Jahrhunderts untersucht der Aufsatz das Bedeutungskontinuum der Rede über gesellschaftliche Komplexität in den USA. Wieso gelangte das Thema in den 1970er-Jahren gleichzeitig zu wissenschaftlicher und zu politischer Prominenz? Was bedeutete es, Gesellschaft als 'komplex' zu denken? Welche Konsequenzen waren aus Komplexitätsdiagnosen zu ziehen und wie veränderten sie Konzeptionen und Selbstverständnisse politischen Handelns?
    Abstract: In the 1970s, sociologists and political scientists began to develop a notion of 'complexity' using concepts from general systems theory and cybernetics and applying them to the fields of social theory as well as to policy research and consultation. Social complexity was, however, not just an issue for social scientific theorists. During the period spanning the 1960s and 1970s, the term gained currency across the social sciences as well as across political and intellectual debates where it was used not only in its narrow analytical sense but also as an explanatory catchword and metaphor for the era. Against the background of historiographical debates on developments during the final third of the twentieth century, this paper examines epistemic and political implications of the discourse on social complexity in the USA. Why did the topic rise to both academic and political prominence in the 1970s? What did it mean to view society as 'complex'? What consequences emerged from the identification of social complexity as a problem, and what consequences did the associated ideas and concepts have for policy-makers?
    Date: 2015
  5. By: Paolo Ramazzotti (Università di Macerata)
    Abstract: <span lang="EN-US" style="mso-ansi-language:EN-US">There are two basic ways to provide a critical view of the economy we live in and of mainstream accounts of it. The first one is to assess whether and how it can meet the procurement requirement, i.e. whether it can achieve the material reproduction of society. It typically includes analyses of the economy’s ability to achieve goals such as full employment, real and financial stability, a decent income for all. The second one is to assess whether, quite independently of its performance, it meets a social requirement, i.e. whether its overall setup is consistent with a range of generally accepted values. The aim of the paper is to focus on this second approach by discussing Veblen’s views of how and why business requirements intrinsically contrast the livelihood of the community. It contends that, in so far as Veblen’s intuition about such a contrast is correct, it should be possible to envisage an appropriate policy to deal with it. Unfortunately, Veblen’s discussion of possible alternatives is not very helpful, in this respect. The paper argues that this has to do with theoretical shortcomings in Veblen’s treatment of profit. The paper is structured as follows. Following the Introduction, Section 2 briefly summarizes the basic features of the Veblenian dichotomy. Section 3 discusses how technology fits into the dichotomy and the unsolved issues in Veblen’s theory. Section 4 points out what appears to be a policy stalemate. It discusses Veblen’s treatment of what he thought could be an alternative to the existing state of affairs. It suggests that Veblen’s notion of pecuniary gain is either too restrictive or too broad to conceive of an economy that overcomes the profitability-serviceability dichotomy. Section 5 contends that a proper understanding of the dichotomy and of possible policies to contrast it has to situate the dichotomy within market relations. Markets are depicted not only as a choice mechanism based on relative prices but as one where important social categories are turned into commodities despite their incompatibility with such a role. This typically Polanyian approach provides some insights on how to conceive of a policy that takes account of the dichotomy but does not waver between the forced acquiescence to the status quo and the millenarian expectation of an all-encompassing change. Our emphasis on the extension of contracted exchange suggests that policy may act on the degree of commodification of the economy and, in particular, of its fictitious commodities. It suggests that other criteria - typically those concerning people’s civil, political and social rights - may prevail over those of relative prices. It goes without saying that this is only a guideline for policy, not a road map. To some extent a guideline such as this one prevailed in some countries during the post Second World War ”golden age”. Neoliberalism has changed this. It has reinstated the principle whereby everything should be conceived of as a commodity, so that markets – contracted exchange based on relative prices - are the ultimate criterion for whatever change. The paper does not aim to discuss the insurgence of neoliberalism. It does suggest, however, that the dichotomy occurs - and should be contrasted – in relation not only to how business chooses the amount and composition of output but also to how it manages labor relations, the creation and application of technology and, more generally, of knowledge.</span>
    JEL: O1 O11
    Date: 2014–11
  6. By: Andrzej Nowak (Institute for Social Studies, University of Warsaw - Institute for Social Studies, University of Warsaw,, Florida Atlantic University [Boca Raton]); Jørgen Vitting Andersen (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Wojciech Borkowski (University of Social Sciences and Humanities - University of Social Sciences and Humanities)
    Abstract: Gintis Helbing and go beyond the traditional boundaries of scientific disciplines and offer the integration of major theories of the main disciplines of the social and natural sciences. The theory captures many ideas of social psychology. Several assumptions of the model, however, can be questioned. The hypothesis that social systems are at equilibrium is too narrow, because social systems can also be out of balance. The concept of dynamic attraction shows that the systems may converge to different types of attractors in accordance with the value of control parameters. The notion of rationality of human behavior can be challenged on the basis of new data of psychology, decision sciences and behavioral economics. Often individuals do not process information, but rather copy the choices of others. Individuals interact by both direct and indirect means – if market mechanisms. More importantly, the social dynamic, unlike physical systems, are governed by a sense. Despite these limitations of the theory and Gintis Helbing is an important step in the integration of social sciences.
    Keywords: Complex system,adaptive system,general equilibrium
    Date: 2015–10
  7. By: Michele Fratianni (Indiana University, Kelly School of Business, Bloomington US, Univ. Plitecnica Marche and MoFiR); Federico Giri (Universit… Politecnica delle Marche, Dipartimento di Scienze economiche e sociali)
    Abstract: The great depression of 1929 and the great financial crisis of 2008 have been the two big events of the last 75 years. Not only have they produced serious economic consequences but they also changed our view of economics and policymaking. The aim of this work is to compare these two great crises and highlight similarities as well as differences. Monetary policy, the exchange rate system and the role of the banks are our fields of investigation. Our findings are that two big events have more similarities than dissimilarities.
    Keywords: Eurozone, Great Depression, Great Financial Crisis, gold standard, money multiplier, shadow banking
    JEL: E31 E42 E5 G21
    Date: 2015–12
  8. By: Benjamin M. Friedman
    Abstract: Keynes’s “Grandchildren” essay famously predicted both a rapid increase in productivity and a sharp shrinkage of the workweek – to fifteen hours – over the century from 1930. Keynes was right (so far) about output per capita, but wrong about the workweek. The key reason is that he failed to allow for changing distribution. With widening inequality, median income (and therefore the income of most families) has risen, and is now rising, much more slowly than he anticipated. The failure of the workweek to shrink as he predicted follows. Other factors, including habit formation, socially induced consumption preferences, and network effects are part of the story too. Combining the analysis of Keynes, Meade and Galbraith suggests a way forward for economic policy under the prevailing circumstances.
    JEL: E21 E24
    Date: 2015–11
  9. By: Yvon Pesqueux (LIRSA - Laboratoire Interdisciplinaire de Recherche en Sciences de l'Action - Conservatoire National des Arts et Métiers [CNAM])
    Abstract: Dans la mesure où le philosophe J. Habermas est couramment cité comme référence en sciences des organisations, principalement pour l'« Ethique de la discussion », c'est pourquoi il figure ici à titre de conclusion de ce chapitre. Se référer à l' « Ecole de Francfort » implique de devoir commenteraussi sa conceptualisation en termes d'« Agir communicationnel ». Ce qu'il est convenu d'appeler « Ethique de la discussion » recouvre l'oeuvre de plusieurs philosophes. Il s'agit, pour l'essentiel, d'auteurs allemands qui s'opposent entre eux sur certains points. L'« Ethique de la discussion », si elle ouvre des perspectives nouvelles, se réfère aussi à une tradition, celle de l'« Ecole de Francfort » dont la démarche s'est constituée autour d'une réflexion philosophique et politique sur la société allemande d'avant et d'après le nazisme qui mêle marxisme, hégélianisme, kantisme et aussi l'apport de certaines sciences humaines comme la sociologie. La dimension critique fondamentale de cette « école » conduisit certains de ces auteurs (T. W. Adorno et M. Hochkeimer) à une conception assez pessimiste de la société contemporaine. Ils voyaient les signes de l'inachèvement d'un projet fondamental, celui de la « modernité des Lumières » (échec qu'on peut constater à travers le triomphe passager mais tragique du nazisme). L'écroulement des valeurs que le nazisme entraîna, fit dire à beaucoup de penseurs de tous horizons qu'on ne pouvait plus penser après Auschwitz. A travers cette tragédie, il semblait désormais que l'irrationalisme fût le dernier mot en matière de pensée. De ce point de vue le génocide qui confirme l'effondrement de la vision rationnelle du monde entraîne aussi une conception morale pessimiste comme l'atteste la déclaration de M. Hochkeimer : « Nous ne pouvons plus dire où est la justice, mais seulement là où est le mal » 1. Cet écroulement de la raison est aussi interprété par certains auteurs comme la conséquence de la démarche et de la dérive nietzschéennes qui fonde, selon J. Habermas, les oeuvres de G. Bataille, M. Foucault et J. Derrida.Cette crise de la raison, de la métaphysique conduit aussi à un usage particulier, celui de la raison instrumentale, positiviste et scientiste, neutre sur le plan axiologique, au moins en apparence et qui ne reconnaît plus d'autres valeurs que celles de l'efficacité, de l'utilité, de la réussite pragmatique à l'oeuvre dans le domaine de la science et de l'économie ou dans une gestion technocratique de la société et des rapports entre les êtres humains. Face au paradoxe de l'éthique, les auteurs de l' « Ecole de Francfort » plaident pour le maintien d'une éthique rationnelle. Elle retrouve une telle alternative à travers ce qu'elledénomme les deux grands courants dominants dans les sociétés occidentales-la philosophie analytique d'une part et l'existentialisme de l'autre, s'opposant à travers 1 M. Horkheimer & T. W. Adorno, La dialectique de la Raison: fragments philosophiques, Gallimard,
    Keywords: Habermas, agir communicationnel, théorie des organisations
    Date: 2015–12–12
  10. By: Paolo Ramazzotti (Università di Macerata)
    Abstract: The paper deals with the lack of attention that many socially-minded economists pay to social issues, with social costs being a special case. It argues that while these economists acknowledge that social costs exist and are rooted in the way the economy functions, they do not frame their economic inquiries accordingly because they believe that scientific dialogue is possible only by accepting a commonly shared ground for scientific inquiry, which focuses on restricted but generally accepted goals. This behavior obscures a major implication of systemic openness, i.e. that the choice of goals and the way scientific inquiry is carried out do not depend on once and for all criteria but require the explicit formulation of a range of value judgments. The conclusion of the paper is that it is possible to deal with social issues and to carry out a scientific dialogue but this requires a two tier dialogue: one relates to the shared grounds of inquiry; the other to the specific issues to be investigated.
    JEL: O1 O11
    Date: 2013–12
  11. By: Yvon Pesqueux (LIRSA - Laboratoire Interdisciplinaire de Recherche en Sciences de l'Action - Conservatoire National des Arts et Métiers [CNAM])
    Abstract: Le nouvel ordre écologique de Luc Ferry – « écosophie » ou éthique de la responsabilité ? Dans cet essai sur l'écologie, L. Ferry remet en cause les fondements de la vision sympathique généralement associée à la perception courante de l'écologie. Revenant au Moyen-âge, il mentionne les signes d'un « contrat naturel » où les animaux étaient considérés comme des créatures de Dieu suivant la loi naturelle ou comme fléau envoyé par le diable, ils pouvaient être dédommagés ou excommuniés. L'action en justice reconnaissait à l'animalité des traits que l'on retrouve sous d'autres formes aujourd'hui. A titre du pendant à l'obscurantisme médiéval, l'auteur mentionne les droits légaux des arbres par une question soulevée en 1972 en Californie en relation avec les thèses de l'« écologie radicale ». Cette posture sert de référence à la genèse actuelle d'un droit de la nature du même ordre que les droits des personnes, par référence à un humanisme moderne. Le statut juridique de la nature est justifié de façon quasiment ontologique et recoupe la nature juridique déjà défendue durant la période pré-moderne. L'Homme n'a plus vocation à être le seul sujet de droit, en particulier par oubli de la biosphère à partir de l'hypothèse implicite de l'existence d'un ordre cosmique. Il est nécessaire de souligner les trois modalités de la mise en exergue de l'écologie :-celle bâtie sur l'idée que c'est toujours l'Homme qui doit être protégé (position humaniste, voire anthropocentriste), la nature ne restant que ce qui environne,-celle qui attribue une signification morale à certains êtres et reprend le principe utilitariste suivant lequel il faut chercher à diminuer l'ensemble des souffrances du monde (le mouvement de libération animale se trouve alors validé et ce mouvement est présent dans les pays anglo-américains),-celle bâtie sur l'idée que la nature, quelle que soit sa forme, est sujet de droit (position de l'écologie radicale à laquelle l'auteur ajoute Hans Jonas et position très présente aux États-Unis et en Allemagne). Les perspectives écologiques s'accompagnent toujours d'une critique de la modernité. C'est donc dans les pays les plus développés que la présence de la pensée écologique est la plus nette. Les démocraties libérales semblent susciter en elles-mêmes leur propre critique. C'est pourquoi la première critique adressée au monde moderne par l'écologie est celle de la techno-science. C'est ensuite celle de l'exigence d'un environnement sain. C'est enfin celle qui est formulée au nom d'une nostalgie et
    Keywords: écologie, développement durable, théorie des organisations
    Date: 2015–12–12
  12. By: Farley Grubb
    Abstract: I reconstruct the data on Virginia’s paper money regime using forensic accounting techniques. I correct the existing data on the amounts authorized and outstanding. In addition, I reconstruct yearly data on previously unknown aspects of Virginia’s paper money regime, including printings, net new emissions, redemptions and removals, denominational structures, expected tax revenues, and specie accumulating in the treasury for paper money redemption. These new data form the foundation for narratives written on the social, economic, and political history of Virginia, as well as for testing models of colonial paper money performance.
    JEL: C82 E51 N11
    Date: 2015–12
  13. By: Mariacristina De Nardi; Giulio Fella; Fang Yang
    Abstract: Piketty's book, Capital in the Twenty-First Century, discusses several factors affecting wealth inequality: rates of return on capital, output growth rates, tax progressivity, top income shares, and heterogeneity in saving rates and inheritances. This paper studies the role of various forces affecting savings in quantitative models of wealth inequality, discusses their successes and failures in accounting for the observed facts, and compares these model's implications with Piketty's conclusions.
    JEL: D14 E21 H2
    Date: 2015–11
  14. By: George J. Hall; Thomas J. Sargent
    Abstract: Congress first imposed an aggregate debt limit in 1939 when it delegated decisions about designing US debt instruments to the Treasury. Before World War I, Congress designed each bond and specified a maximum amount of each bond that the Treasury could issue. It usually specified purposes for which proceeds could be spent. We construct and interpret a Federal debt limit before 1939.
    JEL: E6 H6 N21 N41
    Date: 2015–12
  15. By: Krieger, Tim; Meierrieks, Daniel
    Abstract: In this contribution we study the relationship between income inequality and economic freedom for a panel of 100 countries for the 1971-2010 period. From a panel causality study we find that income inequality has a negative causal effect on economic freedom, while causation does not run in the opposite direction. We argue that the negative effect of inequality on economic liberty is due to the elite's political power stemming from its disproportionate control over a country's economic resources. The elite uses this power to curtail economic freedom to defend its economic interests by discouraging innovation, competition and protecting its rents. Running a series of dynamic panel estimations, we show that the negative effect of income inequality on economic freedom is robust to different sets of controls and estimation techniques. Finally, we show that the dynamics of the inequality-freedom nexus are to some extent conditional upon a country's political regime. When inequality is low, democracies enjoy comparatively higher levels of economic liberty, in line with the interests of a large middle-class. By contrast, economic freedom is lower in democracies (compared to strongly autocratic regimes with the same income distribution) when inequality is high. We argue that the latter finding corresponds to a system of political capitalism or captured democracy, where a powerful economic elite cooperates with politicians and bureaucrats for their mutual benefit.
    Keywords: income inequality,economic freedom,democratic institutions,political capitalism,middle-class,captured democracy
    JEL: D31 D72
    Date: 2015
  16. By: Mtiraoui, Abderraouf
    Abstract: The purpose of this article is to study the relationship between the economic sphere and the phenomenon of corruption was also seen by some economists as Leff (1964), Huntington (1968), Him (1985), Beck and Maher (1986) who say that the relationship is beneficial to the economy as it would improve economic efficiency. The work of Mauro (1995), which form the first empirical estimates on the same query. According to this author, the harmful nature of corruption on investment and economic growth and hence the vital role played by the state in the development of nations. We finally focus on the determinants of corruption i.e. the micro-economic determinants and macroeconomic determinants.
    Keywords: Corruption, fight against corruption, microeconomic, macroeconomic.
    JEL: P30
    Date: 2015–12–26
  17. By: Igor A. Khristoforov (National Research University Higher School of Economics)
    Abstract: The paper considers the role of public opinion and economic expertise in planning and realization of two important Russia’s financial reforms of the nineteenth century: the creation of the State Bank in 1860 and its reform in 1894. It aims at expanding the limits of institutional history and complimenting it with the analysis of ideological and political context. The focus on the images of «ideal» economic development that existed in public imagination as well as in expert opinion enables to look at the financial policy of the 1860s-1890s from a new prospective.
    Keywords: Russian Empire, banking system, reforms, economic expertise.
    JEL: Z
    Date: 2015
  18. By: Stéphane Becuwe; Bertrand Blancheton; Christopher M. Meissner
    Abstract: A large literature has documented an association between economic growth and export diversification. We study this question in France between 1836 and 1938. The period witnessed the onset of modern economic growth and sharp changes in the level of international competition. We use a new long term database on French foreign trade at a high level of disaggregation. At the dawn of the first Globalization, France appears to have specialized along Ricardian lines, exporting a handful of textile products in large quantities. There is a decrease in specialization from 1860 to World War I along the lines of modern studies. Changes in trade costs along with economic growth help explain the evolution of France’s comparative advantage. The decline of export concentration is associated with a chronic deficit in the balance of trade during the Belle Époque and the major part of the interwar period particularly after 1927.
    JEL: N23 N73
    Date: 2015–12
  19. By: Jonathan Eaton; Samuel S. Kortum; Brent Neiman
    Abstract: Obstfeld and Rogoff (2001) propose that trade frictions lie behind key puzzles in international macroeconomics. We take a dynamic multicountry model of international trade, production, and investment to data from 19 countries to assess this proposition quantitatively. Using the framework developed in Eaton, Kortum, Neiman, and Romalis (2015), we revisit the puzzles in a counterfactual with drastically lower trade frictions. Our results largely support Obstfeld and Rogoff's explanation. Most notably, with lower trade frictions, domestic investment becomes much less correlated with domestic saving, mitigating the Feldstein-Horioka (1980) puzzle. Nominal GDP becomes less variable while real GDP becomes much more closely tied to nominal GDP, mitigating the purchasing power parity and exchange rate disconnect puzzles. Lower trade frictions don't help resolve all of the puzzles, however. The correlation of consumption growth across countries, if anything, diminishes.
    JEL: E3 F17 F4
    Date: 2015–12

This nep-hpe issue is ©2015 by Erik Thomson. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.