nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2020‒07‒20
twelve papers chosen by
Erik Thomson
University of Manitoba

  1. Marx's Theory of Value: A Sympathetic Yet Critical Perspective. By Miguel D. Ramirez
  2. Sir Oswald Mosley’s contribution to the Interwar Policy Debate and Fascist Economics By Emilio Ocampo
  3. Exploring the trade (policy) narratives in economic elite discourse By Matthias Aistleitner; Stephan Puehringer
  4. Walter Euckens Weg zum Ordoliberalismus By Vanberg, Viktor
  5. Journal of the History of Economic Thought Preprints – Adam Smith and Economic Development in Theory and Practice: a rejection of stadial model? By Paganelli, Maria Pia
  6. Economic Crisis, General Laws, and the Mid-Nineteenth-Century Transformation of American Political Economy By Naomi R. Lamoreaux; John Joseph Wallis
  7. Interview with Emeritus Professor H.M. (Ted) Kolsen By Bruce Littleboy
  8. Statistical Equilibrium Methods in Analytical Political Economy By Ellis Scharfenaker
  9. Pandemics and protectionism: evidence from the "Spanish" flu By Sharp, Paul Richard; Pedersen, Maja Uhre; Lampe, Markus; Boberg-Fazlic, Nina
  10. Are Economists' Preferences Psychologists' Personality Traits? A Structural Approach By Jagelka, Tomáš
  11. Manuel Belgrano, según Ovidio Giménez By Juan Carlos de Pablo
  12. Art as an Asset: Evidence from Keynes the Collector By Chambers, David; Dimson, Elroy; Spaenjers, Christophe

  1. By: Miguel D. Ramirez (Department of Economics, Trinity College)
    Abstract: This paper critically analyzes the important notion of value or exchange-value from a Marxian perspective as opposed to a neoclassical one. It is argued that the value of a commodity is a historically determined social relation between producers, rather than a subjective relation between man and commodities á la Eugen von Böhm-Bawerk and Stanley Jevons. Value, in the Marxian scheme, tends to assume certain specific forms more often than others depending on the particular stage of economic history, reaching its fullest expression under capitalist production–the highest form of commodity production based on private property. In turn, exchange value–a quantitative relation--is the manner in which value expresses its character of being the product of social (abstract) labor. The paper highlights the classical view of value as expounded by David Ricardo, and focuses on how Marx develops and attempts to resolve key problems in Ricardo’s labor theory of value. It is argued that Ricardo dealt not only with the problem of relative value, but, like Marx, also grappled with the concept of positive (absolute) value. The paper also reviews important challenges to Marx’s theory of value, ranging from the role of the composition of aggregate demand in determining “socially necessary labor†to the issue of whether the transformation of labor values into prices of production is an unnecessary and irrelevant exercise. Finally, the paper turns its attention to the economic role of time from a Marxian perspective as it relates to the determination of interest-bearing (loan) capital and Adam Smith’s important distinction between productive and unproductive labor–one whose clear comprehension rests on viewing value as a social relation.
    JEL: B10 B14 B24
    Date: 2020–07
  2. By: Emilio Ocampo
    Abstract: After being dormant for decades, in the last two decades, right-wing populism resurfaced strongly in Europe and the US channeling a reaction against globalization. This resurgence has prompted economists to pay increasing attention to populist economics. Current versions of right wing populism share many elements with early fascism, particularly the type that developed by the British Union of Fascists (BUF) in the UK under the leadership of Sir Oswald Mosley. Less aggressive and racist than its continental counterparts, one of its pillars was isolationism, which figures prominently in the platforms of modern populist parties in Europe and North America. Although more sophisticated in his economic thinking than Hitler and Mussolini, Mosley’s was less successful politically. His stubborn obnoxiousness and inability to acknowledge his mistakes cemented his status as a political pariah and contributed to the academic neglect of his 1930 program of radical economic reform which he later incorporated into the BUF’s platform. The study of Mosleynomics also has historical value. Mosley’s proposals not only contributed to the interwar policy debate but also anticipated many key elements of the economic policies of fascist and non-fascist regimes on both sides of the Atlantic, not only in the US, Germany and Italy in the 1930s but also in the UK under the Labor Party and Argentina under Perón in the immediate postwar. This essay seeks to contribute to fill a gap in the literature, by tracing the intellectual roots and evolution of Mosley’s economic policy proposals.
    Keywords: Peronism, Fascism, Economic Policy, Argentina
    JEL: B00 B29 E60 E65 N14 N16 O23 P40 P47
    Date: 2020–06
  3. By: Matthias Aistleitner (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria); Stephan Puehringer (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)
    Abstract: Trade liberalization during the neoliberal era since the 1980s has been on the political agenda of many countries. However, in recent years and especially in the course of rising populist movements, protectionist measures seem to be gaining importance again. Nationalist economic policies challenge the overly positive view on economic integration and the reduction of trade barriers established by standard economic theory. In contrast to politicians, for quite a long time the great majority of economists explicitly publicly supported trade liberalization policies. In this paper, we show how trade and trade related policies are addressed and framed in professional economic discourses. Thus, we follow a mixed-method-approach and combine quantitative textual analysis with critical discourse analysis to highlight dominant narratives and imaginaries present in these debates. By analyzing more than 400 trade-related research articles published in high-impact economic journals we highlight three core trade narratives which constitute the elite economists trade discourse: First, “free trade cheerleading†describes a clear link between the alleged lopsidedness of economists in favoring free trade (policies) in the public and academic debate. Second, “Ignorance in a world full of nails†relates to particular methodological and conceptual leanings in the profession, which seem to deepen the dominance of an overall positive evaluation of trade. And third, “success breeds exporting breeds success†postulates a positive causal relation between a firm’s economic performance and its export orientation. We conclude that the narrow perspective in economic elite debates prevents a more comprehensive understanding of the multifaceted challenges related to international integration.
    Keywords: trade narratives, trade policies, discourse analysis, sociology of economics, textual analysis, top economic journals
    Date: 2020–06
  4. By: Vanberg, Viktor
    Abstract: Die in diesem Band versammelten Beiträge überbrücken eine Zeitspanne von drei Jahrzehnten im wissenschaftlichen Wirken Walter Euckens, von seiner 1921 gehaltenen Antrittsvorlesung "Zur Würdigung Saint Simons" bis zum letzten von ihm verfassten Beitrag "Unser Zeitalter der Misserfolge", den er für seine Gastvorlesungen im März 1950 an der London School of Economics vorbereitetet hatte. Die fünfzehn hier wieder abgedruckten Beiträge sind über die dazwischen liegenden Jahre nicht nur recht ungleichmäßig verteilt, sie unterscheiden sich auch deutlich in ihrem Charakter. Elf von ihnen erschienen zwischen 1925 und 1932 in der Zeitschrift des - sich an der Philosophie von Rudolf Eucken, Walter Euckens Vater, ausrichtenden - Euckenbundes, die zunächst unter dem Namen Der Euckenbund, ab 1925 als Die Tatwelt erschien. Dem Charakter der Zeitschrift entsprechend, richteten sich diese Beiträge an ein allgemein gebildetes Publikum. Die übrigen vier richten sich an ein Fachpublikum, wie die beiden bereits genannten Beiträge, der 1932 erschienene Aufsatz "Staatliche Strukturwandlungen und die Krise des Kapitalismus", der gemeinhin als Gründungsdokument der Freiburger Schule gilt, und der 1948 in der Zeitschrift Economica veröffentlichte Aufsatz "On the Theory of he Centrally Planned Economy", der sich mit den planwirtschaftlichen Erfahrungen im Nationalsozialismus befasst. Das Thema, das die in diesen Band aufgenommenen Beiträge verbindet, ist die Wahrnehmung der Gegenwart als Krisenzeit und die Frage danach, worin die Ursachen der Krise zu sehen sind und auf welchem Wege ihre Lösung gefunden werden kann. Einen Schwerpunkt bildet dabei die Auseinandersetzung mit dem Anspruch des Sozialismus, einen solchen Weg aufzeigen zu können. Von Bedeutung für die Einordnung der Beiträge in Euckens Gesamtwerk ist der Umstand, dass sich in seiner Antwort auf die Frage der Krisenursache und Krisentherapie und in seiner Sozialismus-Kritik im Verlauf der 1920er Jahre eine charakteristische Akzentverschiebung zeigt. In dieser Einleitung wird es darum gehen, die Veränderung in Euckens Krisenanalyse aufzuzeigen und die Bedeutung deutlich zu machen, die ihr für die Herausbildung des von ihm maßgeblich initiierten ordoliberalen Forschungsprogramms zukommt.
    Date: 2020
  5. By: Paganelli, Maria Pia
    Abstract: Adam Smith allegedly offers a model of economic development both in his Lectures on Jurisprudence and in the Wealth of Nations—the so called four stages of development model. The model presents a linear unfolding view of economic development from primitive to advanced stages. But Smith´s own historical examples systematically contradict this model. I thus question whether Adam Smith actually endorses and uses the four stages model of development to illustrate development and suggest that if he does, he does it to discredit it instead. For Smith history teaches that development is more accidental than fitting deterministic models.
    Date: 2020–06–13
  6. By: Naomi R. Lamoreaux; John Joseph Wallis
    Abstract: Before the middle of the nineteenth century most laws enacted in the United States were special bills that granted favors to specific individuals, groups, or localities. This fundamentally inegalitarian system provided political elites with important tools that they could use to reward supporters, and as a result, they were only willing to modify it under very special circumstances. In the early 1840s, however, a major fiscal crisis forced a number of states to default on their bonded debt, unleashing a political earthquake that swept this system away. Starting with Indiana in 1851, states revised their constitutions to ban the most common types of special legislation and, at the same time, mandate that all laws be general in their application. These provisions dramatically changed the way government and the economy worked and interacted, giving rise to the modern regulatory state, interest-group politics, and a more dynamic form of capitalism.
    JEL: K1 K2 N4 N41
    Date: 2020–06
  7. By: Bruce Littleboy (School of Economics, University of Queensland)
    Abstract: TThis interview is a partial biography of Ted Kolsen, who migrated to Australia after the Second World War. It is an oral history of an orphan boy sent to England to escape the Nazis. It touches on his time in a Barnado orphanage, his military service in post-War Germany, his work in Australia training as toolmaker, his undergraduate study, his time at the LSE doing a PhD, his work on transport economics, his ascent to a Chair at the University of Queensland, and his appointment onto the Interstate Commission to report to the Commonwealth government on transport policy. The interview illuminates both post-war social history and how economists strive to apply theory to complex practical problems.
    JEL: A11 H70 N77 R49
    Date: 2020–05–22
  8. By: Ellis Scharfenaker
    Abstract: Economic systems produce robust statistical patterns in key sate variables including prices and incomes. Statistical equilibrium methods explain the distributional proper- ties of state variables as arising from specific institutional and behavioral postulates. Two traditions have developed in political economy with the complementary aim of conceptualizing economic processes as irreducibly statistical phenomena but differ in their methodologies and interpretations of statistical explanation. These conceptual differences broadly mirror the methodological divisions in statistical mechanics, but also emerge in distinct ways when considered in the context of social sciences. This paper surveys the use of statistical equilibrium methods in analytical political economy and identifies the leading methodological and philosophical questions in this growing field of research.
    Keywords: Statistical equilibrium, Classical political economy, Maximum entropy, Information theory, Stochastic methods JEL Classification: B41, B51, C18, D30, E10
    Date: 2020
  9. By: Sharp, Paul Richard; Pedersen, Maja Uhre; Lampe, Markus; Boberg-Fazlic, Nina
    Abstract: The impact of COVID-19 on recent tendencies towards international isolationism has been much speculated on but remains to be seen. We suggest that valuable evidence can be gleaned from the "Spanish" flu of 1918-20. It is well-known that the world fell into a protectionist spiral following the First World War, but scholars have almost exclusively ignored the impact of the pandemic. We employ a difference-in-differences strategy on data for Europe and find that excess deaths had a significant impact on trade policy, independent of the war. A one standard deviation increase in excess deaths during the outbreak implied 0.022 percentage points higher tariffs subsequently, corresponding to an increase of one third of a standard deviation in tariffs. Health policy should aim to avoid the experience of the interwar period and consider the international macroeconomic impact of measures (not) taken.
    Keywords: Trade; Protectionism; Pandemics
    JEL: N74 I19 F13
    Date: 2020–07–03
  10. By: Jagelka, Tomáš (University of Bonn)
    Abstract: This paper proposes a method for empirically mapping psychological personality traits to economic preferences. Careful modelling of random components of decision making is crucial to establishing the long supposed but empirically elusive link between economic and psychological systems for understanding differences in individuals' behavior. I use factor analysis to extract information on individuals' cognitive ability and personality and embed it within a Random Preference Model to estimate distributions of risk and time preferences, of their individual-level stability, and of people's propensity to make mistakes. I explain up to 50% of the variation in both average risk and time preferences and in individuals' capacity to make consistent rational choices using four factors related to cognitive ability and three of the Big Five personality traits. True differences in desired outcomes are related to differences in personality whereas actual mistakes in decisions are related to cognitive skill.
    Keywords: economic preferences, personality traits, decision error, measurement error, stochastic discrete choice
    JEL: D91 D80 D01
    Date: 2020–05
  11. By: Juan Carlos de Pablo
    Abstract: Para recordar a Manuel Belgrano, en el 250 aniversario de su nacimiento, y 200 de su fallecimiento, la Academia Nacional de Ciencias Económicas había preparado un panel, que yo iba a integrar. El coronavirus le jugó una mala pasada al creador de la bandera, pero no impide que publique la versión escrita de lo que pensaba decir.
    Date: 2020–06
  12. By: Chambers, David; Dimson, Elroy; Spaenjers, Christophe
    Abstract: The risk-return characteristics of art as an asset have been previously studied through aggregate price indexes. By contrast, we examine the long-run buy-and-hold performance of an actual portfolio, namely, the collection of John Maynard Keynes. We find that its performance has substantially exceeded existing estimates of art market returns. Our analysis of the collection identifies general attributes of art portfolios crucial in explaining why investor returns can substantially diverge from market returns: transaction-specific risk, buyer heterogeneity, return skewness, and portfolio concentration. Furthermore, our findings highlight the limitations of art price indexes as a guide to asset allocation or performance benchmarking.
    JEL: B26 C43 G11 G12 G14 Z11
    Date: 2020–01

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