nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2020‒02‒24
fourteen papers chosen by
Erik Thomson
University of Manitoba

  1. We, You, I, and the Other By Shyam Gouri Suresh; Paul Studtmann
  2. Liquidity preference, capital accumulation and investment financing: Fernando Carvalho’s contributions to the Post-Keynesian paradigm By José Luis Oreiro; Luiz Fernando de Paula; João Pedro Heringer Machado
  3. A New Mechanism to Alleviate the Crises of Confidence in Science - With an Application to the Public Goods Game By Luigi Butera; Philip Grossman; Daniel Houser; John List; Marie-Claire Villeval
  4. Journal of the History of Economic Thought Preprints – Edmond Malinvaud's Criticisms of the New Classical Economics: Restoring the Nature and the Rationale of the Old Keynesians' Opposition By Renault, Matthieu
  5. Ethique et globalisation économique By Jacques Fontanel
  6. Classical Unified Growth Theory By Lueger, Tim
  7. Do people harness deliberate ignorance to avoid envy and its detrimental effects? By Lisa Bruttel; Werner Güth; Ralph Hertwig; Andreas Orland
  8. Culture cumulative, apprentissage social et réseaux sociaux By Claude Meidinger
  9. Critique du capitalisme et différend salarial : Lyotard lecteur kantien de Marx By Richard Sobel
  10. When efficient market hypothesis meets Hayek on information: beyond a methodological reading By Nathanael Colin-Jaeger; Thomas Delcey
  11. The Cost of Being Too Patient By Giuliano, Paola; Sapienza, Paola
  12. Tony Atkinson's New Book, Measuring Poverty around the World: Some Further Reflections By Brandolini, Andrea; Micklewright, John
  13. Robert J. Gordon and the introduction of the natural rate hypothesis in the Keynesian framework By Aurélien Goutsmedt; Goulven Rubin
  14. Diderot contre la physiocratie : une critique républicaine ? By Christopher Hamel

  1. By: Shyam Gouri Suresh; Paul Studtmann
    Abstract: To capture humans’ moral sense game theorists have introduced the Kantian counterfactual. The Nash counterfactual considers the question: what would happen were I to change my behavior on the assumption that no one else does. By contrast, the Kantian counterfactual considers the question: what would happen were everyone to deviate from some behavior? In this paper, we present a model that endogenizes the decision to engage in this type of Kantian reasoning. Our model thus differs from recent approaches to Kantian reasoning in the literature that appeal to exogenous features to explain the level of moral behavior. We show that our model allows one to identify playing a Kantian strategy with playing what we call a ‘we-strategy’, an identification that is made plausible by the inclusion of psychic payoffs. We go on to prove that agents playing our model optimally achieve weakly Pareto socially optimal outcomes. We end by discussing a theorem that places a constraint on agents who achieve positive expected material payoffs and in so doing explains patterns of giving that can be found in nature.
    Keywords: Kantian Morality, Game Theory, Deontology
    JEL: D91 D63 A12 C79
    Date: 2019–10
  2. By: José Luis Oreiro (None); Luiz Fernando de Paula; João Pedro Heringer Machado
    Abstract: This paper assesses the main theoretical contributions by Fernando Cardim de Carvalho to the Post-Keynesian Economics Paradigm: his elucidation of the fundamental principles that define the concept of a monetary production economy; his analysis of decision-making under non-probabilistic uncertainty; his development of a portfolio choice theory in which the decision to invest is regarded as one of possible wealth accumulation strategies; his liquidity preference theory, including its application to banks’ portfolio allocations under uncertainty; and finally his analysis of the finance-funding circuit and its implications for the functioning of monetary economies.
    Keywords: Post-Keynesian theory; Keynes; monetary economics
    JEL: B59 E12 E44
    Date: 2020–02
  3. By: Luigi Butera; Philip Grossman; Daniel Houser; John List; Marie-Claire Villeval
    Abstract: Creation of empirical knowledge in economics has taken a dramatic turn in the past few decades. One feature of the new research landscape is the nature and extent to which scholars generate data. Today, in nearly every field the experimental approach plays an increasingly crucial role in testing theories and informing organizational decisions. Whereas there is much to appreciate about this revolution, recently a credibility crisis has taken hold across the social sciences, arguing that an important component of Fischer (1935)'s tripod has not been fully embraced: replication. Indeed, while the importance of replications is not debatable scientifically, current incentives are not sufficient to encourage replications from the individual researcher's perspective. We propose a novel mechanism that promotes replications by leveraging mutually beneficial gains between scholars and editors. We develop a model capturing the trade-offs involved in seeking independent replications before submission of a paper to journals. We showcase our method via an investigation of the effects of Knightian uncertainty on cooperation rates in public goods games, a pervasive and yet largely unexplored feature in the literature.
    Date: 2020
  4. By: Renault, Matthieu
    Abstract: Unlike standard accounts, recent research in the history of macroeconomics has given increasing attention to the Old Keynesians’ criticisms of the New Classical Economics. In this paper, I address the case of Edmond Malinvaud, who began opposing the latter from the early 1980s and did so throughout the following thirty years. This study shows that his opposition was radical, i.e., multidimensional and systematic, and owes to the methodology and the practice of macroeconometric modeling. In turn, this twofold result sheds light on the nature and the rationale of the Old Keynesians’ opposition to the New Classical Economics from the 1970s onwards, which can be interpreted along the same lines.
    Date: 2019–12–31
  5. By: Jacques Fontanel (CESICE - Centre d'études sur la sécurité internationale et les coopérations européennes - UPMF - Université Pierre Mendès France - Grenoble 2 - UGA - Université Grenoble Alpes)
    Abstract: Summary: Economics calls no morals or ethics. It claims to be science and it affirms that the proper functioning of individual interest constitutes the best economic and social solution for all economic agents. Any measure aimed at modifying the relentless and fair game of the market leads to perverse effects, such as unemployment, public debt or capital transfers, which will strain the future horizons of collective well-being. In this context, economic globalization constitutes major social progress. Heterodox economists question this sketchy concept of man. Concretely, the deviations from hypotheses compared to reality are numerous, such as the existence of competitive monopolies or oligopolies, the necessary political, strategic and sovereign interventions of the States, economic crises, growing inequalities, all the problems collective pollution and the excessive exploitation of the Earth that the particular economic interests can easily neglect to the detriment of the world community.
    Abstract: Résumé : La science économique n'appelle aucune morale ou éthique. Elle se veut science et elle affirme que le bon fonctionnement de l'intérêt individuel constitue la meilleure solution économique et sociale pour l'ensemble des agents économiques. Toute mesure tendant à modifier le jeu implacable et juste du marché conduit à des effets pervers, comme le chômage, l'endettement public ou les transferts de capitaux, qui grèveront les futurs horizons du bien-être collectif. Dans ce contexte, la globalisation économique constitue un progrès social majeur. Les économistes hétérodoxes s'interrogent sur cette conception sommaire de l'homme. Concrètement, les entorses des hypothèses par rapport à la réalité sont nombreuses, comme l'existence de monopoles ou d'oligopoles concurrentiels, les interventions politiques, stratégiques et régaliennes nécessaires des Etats, les crises économiques, les inégalités croissantes, l'ensemble des problèmes de pollution collective, notamment le réchauffement climatique, et l'exploitation excessive de la Terre, notamment de l'oekoumène, que les intérêts économiques particuliers peuvent aisément négliger au détriment de la collectivité mondiale.
    Keywords: ethics,globalization,economic crises,monopolies,pollution,Earth exploitation,State.,Economics,monopoles,Science économique,globalisation,crises économiques,exploitation de la Terre,Etat
    Date: 2020
  6. By: Lueger, Tim
    Abstract: Throughout the history of economic thought, there have been numerous attempts to model an early era of "Malthusian" economic stagnation as well as the transition to an era of economic development in one coherent framework, or, in other words, a unified growth theory. In recent years, unified growth models have attracted a large readership among economists, challenging the conventional exogenous neoclassical growth theory. However, in most of these models, an important effect suggested by Malthus has been frequently omitted. By including what he had called "the great preventive check" in the conventional Malthusian trap model, which is based on the principle of population, the principle of diminishing returns and the principle of labor division, the transition can be modeled in a very simple dynamic macroeconomic framework. The correspondingly advanced theory suggests that increasing life expectancy tends to create a demographic structure that is much less prone to overpopulation. This new interpretation of the classical growth model is suggested to be capable of integrating the mechanisms of economic stagnation and economic development. Although the "vaguer intuitions" of the classical economists provided deeper and more profound insights than those of most modern unified growth theorists, the verbal form of their arguments has at the same time tended to be more favorable to misinterpretations. It is the intention of this work to identify these misinterpretations and to restore the main ideas of classical economics by building a basic classical unified growth model.
    Date: 2019–12
  7. By: Lisa Bruttel (University of Potsdam, Germany); Werner Güth (Max Planck Institute for Collective Goods, Bonn, Germany); Ralph Hertwig (Max Planck Institute for Human Development, Berlin, Germany); Andreas Orland (University of Potsdam, Germany)
    Abstract: Envy is an unpleasant emotion. If individuals anticipate that comparing their payoff with the (potentially higher) payoff of others will make them envious, they may want to actively avoid information about other people’s payoffs. Given the opportunity to reduce another person’s payoff, an individual’s envy may trigger behavior that is detrimental to welfare. In this case, if individuals anticipate that they will react in a welfare-reducing way, they may also avoid information about other people’s payoffs from the outset. We investigated these two hypotheses using three experiments. We found that 13% of our potentially envious subjects avoided information when they did not have the opportunity to reduce another participant’s payoff. Psychological scales do not explain this behavior. We also found that voluntarily uninformed subjects did neither deduct less of the payoff nor less frequently than subjects who could not avoid the information.
    Keywords: envy, emotion regulation, deliberate ignorance, punishment, experiment
    JEL: C91 D23 D63 D83 D91
    Date: 2020–02
  8. By: Claude Meidinger (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Discussions about the existence of a culture in non-human species is often concerned by the question whether these species could possess a cognitive complexity sufficient to allow them to imitate others. According to many authors, to imitate is a cognitively sohisticated process that depends on a functionally abstract representation of a problem and its solution, something that non human species do not seem to possess. However, the fast evolution of cognitive performances and of complex inventions in human beings could not be explained only by the improvement of the rate of innovation in individual learning and (or) the improvement of the process of imitation. Such a cumulative evolution depends also on a wider social organization characterized by an increase in the size of the social networks. The simulations displayed here show how such an increase, jointly considered with the diversity of learning processes, allow to better understand the major transitions noted in the cultural evolution of primates and human beings.
    Abstract: Les discussions concernant l'existence d'une culture chez les espèces non humaines ont eu tendance à se focaliser sur la question de savoir si, en dehors de l'espèce humaine, les espèces animales disposent d'une complexité cognitive suffisante pour imiter autrui. Imiter, chez beaucoup d'auteurs, est réservé à un processus cognitivement sophistiqué, dépendant d'une représentation fonctionnelle abstraite d'un problème et de sa solution, ce dont les espèces animales non humaines ne semblent pas disposer. Cependant, l'évolution rapide de performances cognitives et d'inventions complexes chez les êtres humains caractérisant une évolution culturelle cumulative ne saurait s'expliquer uniquement par une amélioration du taux d'innovation de l'apprentissage individual et (ou) de l'efficacité d'un processus d'imitation. Une telle évolution cumulative dépend également d'une organisation sociale plus étendue au sein de groupes d'individus se traduisant par une augmentation de la taille des réseaux sociaux. Les simulations présentées ici illustrent en quoi la prise en compte de la taille des réseaux sociaux jointe à celle de la diversité des modes d'apprentissage permettent de mieux comprendre les transitions majeures susceptibles de s'être produites lors de l'évolution culturelle des primates et des humains.
    Keywords: learning processes,cumulative cultural evolution,social networks,simulations,processus d'apprentissage,évolution culturelle cumulative,réseaux sociaux
    Date: 2018–09
  9. By: Richard Sobel (CLERSE - Centre Lillois d’Études et de Recherches Sociologiques et Économiques - UMR 8019 - Université de Lille - ULCO - Université du Littoral Côte d'Opale - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The present study aims at providing an analysis of Jean-François Lyotard's criticism of Marx theory of the wage-capital conflict, as it is presented in The Differend: Phrases in Dispute (1983). We uphold that Lyotard's analysis is important and original in many respects. First, it introduces into philosophical criticisms of Marx some considerations on the theory of language. Second, it deals with the wage-capital conflict as a Kantian Idea, made of some irreducible part—"an intractable wrong" done by one party (the Capital) to another (the Workers—, which cannot be expressed within a common language. The article reflects on the nature and consequences of Lyotard's criticism for Marxist studies.
    Abstract: Dans cet article, nous revenons sur la critique de la théorie marxiste du salariat par Jean-François Lyotard dans Le Différend(1983). Nous y soutenons que l'analyse de Lyotard est importante à plusieurs titres. D'abord parce que Lyotard introduit dans la critique philosophique du marxisme des considérations sur le langage. Ensuite parce que Lyotard théorise le rapport salarial comme «tort intraitable» infligé par une partie (le capital) sur une autre (le travail), identifiant donc le «différend» salarial à une Idée au sens kantien. L'article propose une réflexion sur la nature et les conséquences de la critique de Lyotard pour les études marxistes.
    Keywords: Lyotard (Jean-François),differend,post-modernism,language,wage labor,capitalism,différend,post-modernité,langage,salariat,capitalisme
    Date: 2019
  10. By: Nathanael Colin-Jaeger (TRIANGLE - Triangle : action, discours, pensée politique et économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UJM - Université Jean Monnet [Saint-Étienne] - IEP Lyon - Sciences Po Lyon - Institut d'études politiques de Lyon - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Thomas Delcey (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Hayek and the Efficient Market Hypothesis (EMH) are often seen as proposing a similar theory of prices. Hayek is seen as proposing to understand prices as information conveyer, incorporating information during the process of competition, while EMH is defined as the fact that all information in a market is integrated into assets prices. This paper explains how a lineage between Hayek and the EMH can be illustrated while taking into account these differences. We introduce in order to defend this claim a distinction between methodological and epistemological differences: methodological differences are seen as the way an author operationalizes his broader conceptions whereas epistemology is defined as the core concepts of his theory. We particularly want to shed light on the homogeneous shift that can be identified in the epistemology of Hayek and the EMH. We conclude that this shift fleshes out the understanding that some authors have of neoliberalism.
    Keywords: Efficient market hypothesis,Hayek,Neoliberalism,Information,Epistemology of economics
    Date: 2019
  11. By: Giuliano, Paola (University of California, Los Angeles); Sapienza, Paola (Northwestern University)
    Abstract: We study the cost of being too patient on happiness. We find that the relationship between patience and various measures of subjective well-being is hump- shaped: it exists an optimal amount of patience that maximizes happiness. Beyond this optimal level, higher levels of patience have a negative impact on well-being.
    Keywords: patience, happiness
    JEL: A10 D9 Z1
    Date: 2020–01
  12. By: Brandolini, Andrea (Bank of Italy); Micklewright, John (University College London)
    Abstract: A new book on measuring global poverty by the late Tony Atkinson was published in 2019 by Princeton University Press. We describe how we edited the incomplete manuscript that Atkinson left at his death, the additions we made (which include afterwords by François Bourguignon and Nick Stern), and the content and structure of the book. We then discuss what we believe Atkinson was trying to achieve, emphasising both the important insights of the book and where the gaps remain. We also review parallel developments in the World Bank's measurement of global poverty that were stimulated by the report of the Commission on Global Poverty, written by Atkinson, from which this book was developed. The new book is more than four hundred published pages. It remains unfinished yet it is a masterly guide to the nuances of poverty measurement and an invaluable source for future research.
    Keywords: global poverty, income, consumption, multidimensional poverty, cosmopolitanism
    JEL: C80 I32
    Date: 2020–01
  13. By: Aurélien Goutsmedt (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, UP1 - Université Panthéon-Sorbonne, Chaire Energie & Prospérité - ENS Paris - École normale supérieure - Paris - X - École polytechnique - ENSAE ParisTech - École Nationale de la Statistique et de l'Administration Économique - Institut Louis Bachelier); Goulven Rubin (LEM - Lille économie management - LEM - UMR 9221 - Université de Lille - UCL - Université catholique de Lille - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This article studies the dissemination of the Natural Rate of Unemployment Hypothesis (NRH) in macroeconomics during the 1970s, by studying the reaction of Robert J. Gordon to the argument of Milton Friedman (1968). In the early 1970s, Gordon displayed an empirical opposition to the NRH, arguing that the estimated parameter on expected inflation was below one, meaning that the adjustment of inflation in wages was not total. Confronting to new data and to the rise of inflation, Gordon adopted the NRH after 1973. Nevertheless the adoption anticipated any empirical proof of a parameter close to one. We explain that this conversion was due to Friedman's influence on Gordon, but also to the fact it did not prevent Gordon to support active stabilization policies. The article shows how a complex explanation of the 1960s and 1970s inflation was little by little replaced by the simpler accelerationist Phillips Curve. It enables to understand the dissemination of this particular Phillips Curve, relying on the NRH, as a process mainly led by economists close to the Keynesian framework.
    Keywords: Expectations,Natural rate of unemployment,Phillips curve,Stagflation
    Date: 2018–05
  14. By: Christopher Hamel (ERIAC - Équipe de Recherche Interdisciplinaire sur les Aires Culturelles - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université - IRIHS - Institut de Recherche Interdisciplinaire Homme et Société - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université)
    Date: 2019

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