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on History and Philosophy of Economics |
| By: | André Lapidus (PHARE - Philosophie, Histoire et Analyse des Représentations Économiques - UP1 - Université Panthéon-Sorbonne) |
| Date: | 2018–02–21 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01714256&r=all |
| By: | Hugh Rockoff |
| Abstract: | Although attempts to measure trends in prices, output, and employment can be traced back for centuries, in the main the origins of the U.S. federal statistics are to be found in bitter debates over economic policy, ultimately debates over the distribution of income, at the end of the nineteenth century and during the world wars and Great Depression. Participants in those debates hoped that statistics that were widely accepted as nonpolitical and accurate would prove that their grievances were just and provide support for the policies they advocated. Economists – including luminaries such as Irving Fisher, Wesley C. Mitchell, and Simon Kuznets – responded by developing the methodology for computing index numbers and estimates of national income. Initially, individuals and private organizations provided these statistics, but by the end of WWII the federal government had taken over the role. Here I briefly describe the cases of prices, GDP, and unemployment. |
| JEL: | A30 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25431&r=all |
| By: | Heckman, James J. (University of Chicago) |
| Abstract: | Understanding inequality and devising policies to alleviate it was a central focus of Jan Tinbergen's lifetime research. He was far ahead of his time in many aspects of his work. This essay places his work in the perspective of research on inequality in his time and now, focusing on his studies on the pricing of skills and the evolution of skill prices. In his most fundamental contribution, Tinbergen developed the modern framework for hedonic models as part of his agenda for integrating demand and supply for skills to study determination of earnings and its distribution and the design of effective policy. His lifetime emphasis on social planning caused some economists to ignore his fundamental work. |
| Keywords: | income inequality, hedonic models, general equilibrium, models of inequality |
| JEL: | B31 D31 D33 D63 I24 J20 P21 |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12046&r=all |
| By: | Claude DIEBOLT; Charlotte LE CHAPELAIN |
| Abstract: | The aim of this entry is (I) to undertake a critical reading of the seminal contribution of Lucas’ work to construct a model which represents the complexity of the links between human capital and economic growth (II) to review the empirical assessments of its endogenous nature. |
| Keywords: | Economic Growth, Human Capital. |
| JEL: | E13 I20 I25 N30 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2019-02&r=all |
| By: | Nitzan, Jonathan; Bichler, Shimshon |
| Abstract: | This paper clarifies a common misrepresentation of our theory of capital as power, or CasP. Many observers tend to box CasP as an ‘institutionalist’ theory, tracing its central process of ‘differential accumulation’ to Thorstein Veblen’s notion of ‘differential advantage’. This view, we argue, betrays a misunderstanding of CasP, Veblen or both. First, we are not Veblenians and certainly not institutionalists: Veblen’s theory was evolutionary, while CasP is deeply dialectical, and institutionalism, particularly its ‘new’ varieties, emphasizes and often promotes what holds capitalism together, whereas CasP critically examines both the underpinnings of capitalized power as well as the forces that threaten and undermine it. Second, CasP’s notion of differential accumulation is not only different from, but also diametrically opposed to Veblen’s differential advantage. Veblen, who wrote at the turn of the twentieth century, before the appearance of business indices and financial benchmarks, emphasized the absolute drive for ‘maximum profit’ and saw strategic sabotage merely as a power means to an economic end. By contrast, CasP, which was developed at the end of the twentieth century, sees power not only as a means of accumulation, but also – and perhaps more importantly – as its ultimate purpose. Accumulators, it argues, are conditioned and driven to augment not their profits and assets as such, but their relative power, and this means that, as symbolic bearers of power, these profits and assets should be measured not absolutely, but relatively to those of others – hence the imperative of differential accumulation. |
| Keywords: | capital as power,differential accumulation,differential advantage,evolutionary economics,institutionalism,power,Thorstein Veblen |
| JEL: | P16 B15 B25 B52 L P22 E23 D3 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:capwps:201901&r=all |
| By: | Vicente Ferreira |
| Abstract: | This paper addresses the evolution of evolutionary thought in economics as an alternative to the dominant static view of the economy. A short history of the earlier institutional approach, announced by Thorstein Veblen’s 1898 paper ‘Why is economics not an evolutionary science?’, is presented alongside a discussion of its key methodological and philosophical aspects. Veblen’s critiques of neoclassical economics are also discussed. Then the role of evolutionary concepts in economics throughout the twentieth century is analysed, from later institutionalists to recent complexity and chaos theories. It is argued complexity approaches are developed in line with Veblen’s institutional theory, and may be incorporated in an evolutionary theoretical framework which constitutes a necessary alternative to the neoclassical paradigm, as it better describes and studies real-world socio-economic phenomena. |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:ise:isegwp:wp012019&r=all |
| By: | Thomas Dohmen; Simone Quercia; Jana Willrodt |
| Abstract: | We show that the disposition to focus on favorable or unfavorable outcomes of risky situations affects willingness to take risk as measured by the general risk question. We demonstrate that this disposition, which we call risk conception, is strongly associated with optimism, a stable facet of personality and that it predicts real-life risk taking. The general risk question captures this disposition alongside pure risk preference. This enlightens why the general risk question is a better predictor of behavior under risk across different domains than measures of pure risk preference. Our results also rationalize why risk taking is related to optimism. |
| Keywords: | risk taking behavior, optimism, preference measures, risk conception |
| JEL: | D91 C91 D81 D01 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2018_023&r=all |
| By: | Gabriel Ziegler; Peio Zuazo-Garin |
| Abstract: | Economic predictions often hinge on two intuitive premises: agents rule out the possibility of others choosing unreasonable strategies (‘strategic reasoning’), and prefer strategies that hedge against unexpected behavior (‘cautiousness’). These two premises conflict and this undermines the compatibility of usual economic predictions with reasoning-based foundations. This paper proposes a new take on this classical tension by interpreting cautiousness as robustness to ambiguity. We formalize this via a model of incomplete preferences, where (i) each player’s strategic uncertainty is represented by a possibly non-singleton set of beliefs and (ii) a rational player chooses a strategy that is a best-reply to every belief in this set. We show that the interplay between these two features precludes the conflict between strategic reasoning and cautiousness and therefore solves the inclusion-exclusion problem raised by Samuelson (1992). Notably, our approach provides a simple foundation for the iterated elimination of weakly dominated strategies |
| Keywords: | Game theory, decision theory, ambiguity, Knightian uncertainty, incomplete preferences, Bayesian rationality, cautiousness, iterated admissibility |
| JEL: | C72 D82 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1630&r=all |
| By: | Pierpaolo Battigalli; Roberto Corrao; Federico Sanna |
| Abstract: | We consider multi-stage games with incomplete information and observable actions, and we analyze strategic reasoning by means of epistemic events within a total state space made of all the pro les of behaviors (paths of play) and possibly incoherent in nite hierarchies of conditional beliefs. Thus, we do not rely on types structures, or similar epistemic models. Subjective rationality is de ned by the conjunction of coherence of belief hierarchies, rational planning, and consistency between plan and on-path behavior. Since consistent hierarchies uniquely induce beliefs about behavior and belief hierarchies of others, we can de ne rationality and common strong belief in rationality, and analyze their behavioral and low-order beliefs implications, which are characterized by strong rationalizability. Our approach allows to extend known techniques to the epistemic analysis of psychological games where the utilities of outcomes depend on beliefs of order k or lower. This covers almost all applications of psychological game theory. JEL Classification Numbers: C72, C73, D82. Keywords: Epistemic game theory, belief hierarchies, consistency, subjective rationality, strong rationalizability, psychological games. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:igi:igierp:641&r=all |
| By: | Demeze-Jouatsa, Ghislain-Herman (Center for Mathematical Economics, Bielefeld University) |
| Abstract: | In this paper, we present a model of finitely repeated games in which players can strategically make use of objective ambiguity. In each round of a finite rep- etition of a finite stage-game, in addition to the classic pure and mixed actions, players can employ objectively ambiguous actions by using imprecise probabilistic devices such as Ellsberg urns to conceal their intentions. We find that adding an infinitesimal level of ambiguity can be enough to approximate collusive payoffs via subgame perfect equi- librium strategies of the finitely repeated game. Our main theorem states that if each player has many continuation equilibrium payoffs in ambiguous actions, any feasible pay- off vector of the original stage-game that dominates the mixed strategy maxmin payoff vector is (ex-ante and ex-post) approachable by means of subgame perfect equilibrium strategies of the finitely repeated game with discounting. Our condition is also necessary. |
| Keywords: | Objective Ambiguity, Ambiguity Aversion, Finitely Repeated Games, Subgame Perfect Equilibrium, Ellsberg Urns, Ellsberg Strategies |
| Date: | 2018–08–13 |
| URL: | http://d.repec.org/n?u=RePEc:bie:wpaper:585&r=all |
| By: | Walkowitz, Gari |
| Abstract: | Driven by methodological concerns, theoretical considerations, and previous evidence, we systematically test the validity of common dictator-game variants with probabilistic incentives. We include four approaches and compare them to a standard dictator game: involving fewer receivers than dictators; paying only some subjects or decisions; role uncertainty at the time of the transfer decision. We also relate the dictator-game variants to established complementary individual difference measures of pro-sociality: social value orientation, personal values, a donation to charity, and Big Five personality facors. Our data show that dictator behavior is quite sensitive to the applied methods. The standard version of the dictator game has the highest validity. Involving fewer receivers than dictators and not paying for all decisions yields comparably valid results. By contrast, when only some subjects are paid or where subjects face uncertainty about their final player role, the expected associations with complementary pro-sociality are distorted. Under role uncertainty, generosity is biased upwards. We conclude that the validity of the dictator-game outcomes is highly sensitive to the applied methods. |
| Keywords: | Dictator Game, Probabilistic Incentives, Social Value Orientation, Personal Values, Donation, Big Five Personality, Experiment, Methodology |
| JEL: | C72 C91 D3 |
| Date: | 2019–01–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:91541&r=all |
| By: | Bergantiños, Gustavo; Massó, Jordi; Neme, Alejandro |
| Abstract: | We consider a society whose members have to choose not only an outcome from a given set of outcomes but also the subset of agents that will remain members of the society. We study the extensions of approval voting, plurality voting, Borda methods and Condorcet winners to our setting from the point of view of their consistency and internal stability properties. |
| Keywords: | Internal Stability; Consistency; Efficiency; Anonymity, Neutrality; Participation |
| JEL: | C78 |
| Date: | 2019–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:91714&r=all |