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on History and Philosophy of Economics |
| By: | A. D. Correia; H. T. C. Stoof |
| Abstract: | In nature and society problems arise when different interests are difficult to reconcile, which are modeled in game theory. While most applications assume uncorrelated games, a more detailed modeling is necessary to consider the correlations that influence the decisions of the players. The current theory for correlated games, however, enforces the players to obey the instructions from a third party or "correlation device" to reach equilibrium, but this cannot be achieved for all initial correlations. We extend here the existing framework of correlated games and find that there are other interesting and previously unknown Nash equilibria that make use of correlations to obtain the best payoff. This is achieved by allowing the players the freedom to follow or not to follow the suggestions of the correlation device. By assigning independent probabilities to follow every possible suggestion, the players engage in a response game that turns out to have a rich structure of Nash equilibria that goes beyond the correlated equilibrium and mixed-strategy solutions. We determine the Nash equilibria for all possible correlated Snowdrift games, which we find to be describable by Ising Models in thermal equilibrium. We believe that our approach paves the way to a study of correlations in games that uncovers the existence of interesting underlying interaction mechanisms, without compromising the independence of the players. |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1809.03860&r=hpe |
| By: | Mongin, Philippe (GREGHEC; CNRS & HEC Paris - Economics & Decision Sciences) |
| Abstract: | Whereas many others have scrutinized the Allais paradox from a theoretical angle, we study the paradox from an historical perspective and link our findings to a suggestion as to how decision theory could make use of it today. We emphasize that Allais proposed the paradox as a normative argument, concerned with "the rational man" and not the "real man", to use his words. Moreover, and more subtly, we argue that Allais had an unusual sense of the normative, being concerned not so much with the rationality of choices as with the rationality of the agent as a person. These two claims are buttressed by a detailed investigation – the first of its kind – of the 1952 Paris conference on risk, which set the context for the invention of the paradox, and a detailed reconstruction – also the first of its kind – of Allais's specific normative argument from his numerous but allusive writings. The paper contrasts these interpretations of what the paradox historically represented, with how it generally came to function within decision theory from the late 1970s onwards: that is, as an empirical refutation of the expected utility hypothesis, and more specifically of the condition of von Neumann-Morgenstern independence that underlies that hypothesis. While not denying that this use of the paradox was fruitful in many ways, we propose another use that turns out also to be compatible with an experimental perspective. Following Allais's hints on "the experimental definition of rationality", this new use consists in letting the experiment itself speak of the rationality or otherwise of the subjects. In the 1970s, a short sequence of papers inspired by Allais implemented original ways of eliciting the reasons guiding the subjects' choices, and claimed to be able to draw relevant normative consequences from this information. We end by reviewing this forgotten experimental avenue not simply historically, but with a view to recommending it for possible use by decision theorists today. |
| Keywords: | Allais Paradox; Decision Theory; Expected Utility Theory; Experimental Economics; Positive vs Normative; Rationality; 1952 Paris Conference; Allais; Von Neumann and Morgenstern; Samuelson; Savage |
| JEL: | B21 B31 B41 C91 D80 |
| Date: | 2018–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:1299&r=hpe |
| By: | Ugo Pagano (Department of Economics, University of Siena, Italy); Massimiliano Vatiero (Law Institute (IDUSI) and Institute of Economics (IdEP), Faculty of Economics, Università della Svizzera italiana, Switzerland) |
| Abstract: | People consume because others consume, maintained Veblen in 1899. More recently, theoretical, empirical and experimental articles have argued that people constantly compare themselves to their environments and care greatly about their relative positions. Given that competition for positions may produce social costs, we adopt a Law and Economics approach (i) to suggest legal remedies for positional competition, and (ii) to argue that, because legal relations are characterized in turn by positional characteristics, such legal remedies do not represent free lunches. |
| Keywords: | Positional good, Conspicuous consumption, Legal ordering, Legal relations |
| JEL: | B41 D01 D62 K00 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:lug:wpidep:1802&r=hpe |
| By: | John B. Davis (Department of Economics Marquette University) |
| Abstract: | This chapter examines the nature of ethics and economics as a single subject of investigation, and uses a complex systems approach to characterize the nature of that subject. It then distinguishes mainstream economic and social economic visions of it, where the former assumes that market processes encompass social processes, and the latter assumes that market processes are embedded in social processes. For each vision, string and weak theses are compared. Both visions are first explained in terms of their respective views of the positive-normative distinction, then in terms of a central normative principle, and then in terms of their policy strategies. The chapter closes with comments on the future status of ethics and economics as a single subject of investigation. |
| Keywords: | ethics and economics, complex systems, mainstream economics, social economics, positive-normative distinction, efficiency, externalities, cost-benefit, capabilities, 'off limits,' 'taming the market' |
| JEL: | A12 A13 B41 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:mrq:wpaper:2018-01&r=hpe |
| By: | Anwar Shaikh (Department of Economics, New School for Social Research); Kyle Glenn (Department of Economics, New School for Social Research) |
| Abstract: | The ability to accommodate heterogenous types of labor has presented a serious issue for the labor theory of value. Ever since Bohm-Bawerk's criticizism of Marx's theory as circular, Marxist's have contributed considerable e orts to prove the labor theory of value holds with the inclusion of heterogenous labor. This paper analyzes some of the more notable approaches to the problem. This paper proceeds in the following manner: Section 1 brie y introduces the topic of skilled labor within the labor theory of value as well as Bohm-Bawerk's theoretical critique. Section 2 presents the basic framework and notation used in the paper. Section 3 explores Hilferding's solution to the problem as formalized by Rowthorn. The well known contribution to the literature by Bowles and Gintis is also addressed here. Section 4 examines the extension to heterogenous labor within the \New Interpretation" of Dumenil and Foley. Section 5 introduces a method formalized by Shaikh which this paper refers to as a "cost of skilling" approach. Finally, section 6 discusses key implications of the varying approaches and situates the cost of skilling amongst them. |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:new:wpaper:1811&r=hpe |
| By: | Plata Arenas, Lizeth Daniela |
| Abstract: | : The present text, is a review of the first currents of the economic thought and its main postulates; things a: mercantilists, physiocrats and classics; in the latter, emphasis is placed on the propositions of Adam Smith and David Ricardo. All this in order to understand and differentiate their approaches, taking into account that some authors rely on the previous answers to complement or generate a new theory. |
| Keywords: | Pensamiento económico, mercantilistas, fisiócratas, clásicos |
| JEL: | B0 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:88670&r=hpe |
| By: | Claudius Graebner; Birte Strunk |
| Abstract: | This paper provides a taxonomy and evaluation of five common arguments against pluralism in economics: (1) the claim that economics is already pluralist, (2) the argument that if there was the need for greater plurality, it would emerge on its own, (3) assertion that pluralism means "anything goes" and is thus unscientific, (4) the claim that economics must have a single core paradigm to justify its role as a major science, and (5) the contention that pluralism is an ideological movement from the left, and should not be granted scientific attention. We provide counter-arguments to all these arguments. Based on the assesment of these critques we identify two main challenges to be faced by advocates of pluralism: first, the need to derive adequate quality criteria for a pluralist economics, and second, the necessity to propose strategies that ensure the communication across different research paradigms. The paper concludes with some suggestions to meet these challenges. |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:ico:wpaper:82&r=hpe |
| By: | Karras, Sotirios (Sam) |
| Abstract: | There are three impulses that form our approaches. By forming our approaches direct us to our findings and developments. We build things on this very “our own image” of our impulses. How do we know the impulses? By using other scientists’ findings or quotes, which I agree with, that built my case, especially in Methodology and Context/nature sections. Where do we locate those impulses? They inhabit in our nature. Which part in human’s nature? Inquiry (Babbie). How do those impulses work? In three types of approach: problematization, analyzation & systematization. In science those were known as conceptualization, operationalization & measurement (Babbie). |
| Keywords: | Human Impulses, Human Inquiry, Operators, Administrator Evaluator Implementor, System Dynamics, Tripartite Structure, Intuition |
| JEL: | A1 A2 B4 B5 D0 D2 D7 D8 H0 H1 M2 O1 O2 O3 P0 P4 P5 Y2 Y3 Y4 Y5 Y6 Y8 Y9 Z0 Z1 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:89078&r=hpe |
| By: | Oliver Kirchkamp (FSU Jena, School of Economics); Christina Strobel (FSU Jena, School of Economics) |
| Abstract: | Humans make decisions jointly with others. They share responsibility for the outcome with their interaction partners. Today, more and more often the partner in a decision is not another human but, instead, a machine. Here we ask whether the type of the partner, machine or human, affects our responsibility, our perception of the choice and the choice itself. As a workhorse we use a modified dictator game with two joint decision makers: either two humans or one human and one machine. We find no treatment effect on perceived responsibility or guilt. We also find only a small and insignificant effect on actual choices. |
| Keywords: | Human-computer interaction, Experiment, Shared responsibility, Moral wiggle room |
| JEL: | C91 D63 D80 |
| Date: | 2018–09–12 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2018-014&r=hpe |
| By: | Robson, Keith (HEC Paris); Dambrin, Claire (ESCP Europe - Management Control Department); Bottausci, Chiara (HEC Paris) |
| Abstract: | This study explores how morality is constituted into accounting objects and how accounting becomes a moral mediator. We retrace the moral practices that subtend the field-level construction of a Principal-Agent incentive algorithm in a Big Pharma company, with particular focus on the inscribing work through which different communities of knowledge, internal and external to the organization, try to realize particular moral principles for the performance measurement system in the making. The study draws upon Science and Technology Studies (Latour, 1989; Jasanoff, 2015) to explore performance measurement systems as existing in Moral Imaginaries, ethical visions that positions accounting devices, and their material features and technical functionalities, as embedding and enacting ‘moral’ and ‘just’ viewpoints. We show how performance measurement systems emerge as moral calculating devices that are shaped by, and struggle with, the contrasting moralities of heterogeneous designers, but also act as moral mediators that reshape human actors’ moral imaginaries as their algorithmic constructions and data outputs perform. In so doing, we contribute to Science and Technology Studies by highlighting how the constitution of who / what is an “Agent”, and its actantiality, is embedded upon movements in which morality circulates, is claimed by actors and attributed to others, and finally objectified in material technologies. |
| Keywords: | morality; accounting; imaginaries |
| JEL: | M41 |
| Date: | 2018–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:1301&r=hpe |
| By: | Luca Anderlini (Department of Economics, Georgetown University); Leonardo Felli (Department of Economics, London School of Economics); Alessandro Riboni (Département d'Économie, École Polytechnique) |
| Abstract: | We analyze the efficiency and consistency of courts’ decisions under common and civil law. As a motivating example, we study the enforcement of property rights in courts. Judges are of two types: some judges are conservative and mechanically follow the precedent or the statute, while others maximize social welfare. The civil law and common law traditions have different centers of authority (legislatures vs. judges), but they also differ with respect to the timing of legal decisions (ex-ante vs. ex-post). When legal decisions occur ex-post, law-makers are biased even if they are welfare-maximizers. Such an ex-post bias has implications on the relative efficiency and consistency of each legal system. If the economic environment is fixed, we find that legal certainty is lower under civil law than under common law. Common law achieves higher expected welfare than civil law regime when the proportion of conservative judges is neither too low nor too high, and judges are sufficiently forward-looking. In changing economic environments, civil law courts do not respond to economic shocks. Conversely, common law courts change the law only if shocks are persistent. Shock persistence is what makes common law more likely to dominate civil law because of its greater adaptability. |
| Keywords: | Property Right Protection, Legal Origin, Time-Inconsistency, Investment, Legal Adaptability. |
| JEL: | D23 D86 C79 K12 K13 |
| Date: | 2018–09–13 |
| URL: | http://d.repec.org/n?u=RePEc:geo:guwopa:gueconwpa~18-18-12&r=hpe |
| By: | Plutniak, Sébastien |
| Abstract: | From as early as the 1950s, J.C. Gardin's work spanned both archaeology and the emerging automation of numerical computation and documentation. In 1961, with P. Garelli, he published the first automated application of graph theory to historical materials, working from Assyrian cuneiform tablets documenting economic relations. This work was then widely ignored both in archeology and network analysis. However, in the past twenty years, socio-epistemic claims related to the growth of the Internet and computing (digital humanities, computational archaeology, etc.) have brought a surge of interest in Gardin's work, which is now regarded as pioneering. Working from archive materials and publications, this paper shows how a historical sociology of scientific writings can be relevant to the history of automation in historical sciences. The paper examines Gardin's recognition as an influential forerunner of computational archeology, showing that : 1) although Gardin had access to resources (financial, instrumental, etc.) that were rare at the time, and could have provided material for the foundation of a school or a specialty, he did not however pursue this ambition; 2) the demonstrative purposes pursued by Gardin with his study of 1961 economic networks varied between the 1960s (demonstrating the relevance of non-numerical computation) and the 1980s (legitimizing simulation in the social sciences), but were never concerned with network analysis as such. |
| Keywords: | History of Science, Quantitative Methods, Economic Networks, Assyriology |
| JEL: | B2 B23 B25 B4 C63 N75 N95 |
| Date: | 2018–09–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:89058&r=hpe |
| By: | Dathe, Uwe; Hedtke, Ulrich |
| Abstract: | In den Jahren 1939 und 1940 erschienen kurz nacheinander zwei Hauptwerke der theoretischen Nationalökonomie: Joseph Schumpeters 'Business Cycles' und Walter Euckens 'Grundlagen der Nationalökonomie'. Während Schumpeter (1883-1950) in den 'Business Cycles' seine Theorie der wirtschaftlichen Entwicklung mit seinen Forschungen zum langwelligen Konjunkturverlauf verband und einen regelmäßigen Verlauf langwelliger innovationsbezogener Wirtschaftszyklen von ca. 55 Jahren herausarbeitete, erklärte Eucken (1891-1950) zum Thema wirtschaftliche Entwicklung: "Es gibt keinen Normal-Zyklus der Konjunktur". Im Besondern übergeht er den von Schumpeter 1911 eingeführten Ansatz, ausdrücklich zwischen Wachstum und Entwicklung zu unterscheiden und reflektiert anstelle von Entwicklungen allgemein wirtschaftliche Veränderungen. Nimmt man noch seine konjunkturtheoretische Position hinzu, wonach wirtschaftlich endogene Faktoren konjunkturell genauso ausschlaggebend sind wie exogene, dann ist der Eindruck nicht abzuweisen, dass Eucken an der besonderen Entwicklungsvorstellung Schumpeters gleichsam vorbeigeht und er dessen Innovationstheorie nicht rezipiert. [...] |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:aluord:1810&r=hpe |
| By: | Gioavnni Di Bartolomeo; Martin Dufwenberg; Stefano Papa; Francesco Passarelli |
| Abstract: | Why do people keep their promises? Vanberg (2008) and Ederer & Stremitzer (2017) provide causal evidence in favor of, respectively, an intrinsic preference for keeping one’s word and Charness & Dufwenberg’s (2006) expectations-based account based on guilt aversion. The overall picture is incomplete though, as no study disentangles effects in a design that provides exogenous variation of both (the key features of) promises and beliefs. We present an experimental design that does so. |
| Keywords: | Promises, expectations, guilt aversion, moral commitment, causation |
| JEL: | A13 C91 D03 D64 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:baf:cbafwp:cbafwp1881&r=hpe |
| By: | Anita (A.G.) Kopanyi-Peuker (University of Amsterdam) |
| Abstract: | In many real-life situations people face a simple decision whether to volunteer or not to provide some benefit for themselves and also for others. This research investigates the effects of the group size and the magnitude of the volunteering cost in a controlled large-scale laboratory experiment, where subjects play the volunteer’s dilemma only once. The experiment varies group sizes ranging from groups of 3 to about 100, and 2 different cost/benefit ratios. Results show that high cost reduces volunteering probability only in the smallest groups, but not for other group sizes. Furthermore, non-monotonic group size effect is found on the individual volunteering decisions. These findings are not in line with the mixed-strategy Nash equilibrium prediction. Subjects volunteer more often in most treatments than the Nash prediction which benefits them on average compared to the Nash prediction. |
| Keywords: | Volunteer's dilemma; coordination; group size; large-scale experiment |
| JEL: | C72 C92 |
| Date: | 2018–07–04 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20180072&r=hpe |
| By: | Giorgos Galanis (The University of Warwick); Roberto Veneziani (Queen Mary University of London) |
| Abstract: | This paper analyses the temporal unit of egalitarian concern. In the intertemporal context, the differences between egalitarian views can be appreciated not only in inequality analysis but also as regards the ideal egalitarian distribution to be established. In this paper, three intergenerational egalitarian principles (Complete Lives Egalitarianism, Corresponding Segments Egalitarianism and Simultaneous Segments Egalitarianism) are analysed and CSE is argued to be the appropriate egalitarian bench-mark. The relations between the three principles and other moral ideals, namely maximin and utilitarianism, are also analysed. It is proved that CLE and CSE are compatible with a concern for the worst off and, partially, with a utilitarian concern, while the adoption of SSE implies a worse trade-off between egalitarianism and the other moral ideals. |
| Keywords: | Time, Inequality, Intertemporal setting, Difference principle |
| JEL: | D63 C61 |
| Date: | 2017–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:qmw:qmwecw:812&r=hpe |