nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2021‒09‒06
seventeen papers chosen by
Erik Thomson
University of Manitoba

  1. A Universally Translatable Explication of Adam Smith’s Famous Proposition on “The Extent of the Market” By Wilson, Bart J.; Marese, Gian Marco
  2. The Edifying Discourses of Adam Smith: Focalism, Commerce, and Serving the Common Good By Matson, Erik W.
  3. Adam Smith and The Roots of Populism By Roberto Censolo; Massimo Morelli
  4. Chronist der Banken: Alfred Lansburgh (1872-1937) By Greitens, Jan
  5. Introduction to Symposium: Celebrating the Centenary of Keynes’s Treatise on Probability By Bateman, Bradley W.
  6. Reading Keynes’s policy papers through the prism of his Treatise on Probability: information, expectations and revision of probabilities in economic policy By Rivot, Sylvie
  7. Frank Plumpton Ramsey and the Politics of Motherhood By Marouzi, Soroush
  8. The Econometric Society European meetings 1931-1939: Influences on economics By Schilirò, Daniele; Young, Warren
  9. Non-Proletarianization Theories of the Jewish Worker (1902-1939). By Vallois, Nicolas
  10. The life and work of a South African economist: Desmond Hobart Houghton, 1906-76 By Maylam, Paul
  11. Benjamin Graham on Buffer Stocks By Woods, John E
  12. Expectations in Past and Modern Economic Theory By Richard Arena; Muriel Dal Pont Legrand; Roger Guesnerie
  13. Sur l'anthropologie économique de Bourdieu et la sociologie de la consommation de Simon Langlois By François Gardes
  14. Review of “ Scientific History: Experiments in History and Politics from the Bolshevik Revolution to the End of the Cold War” by Elena Aronova By Klein, Ursula
  15. Pluralist Economics as a Democratizing Force: A Review Essay about The Routledge Handbook of Heterodox Economics and Democratizing the Economics Debate: Pluralism and Research Evaluation By Eichacker, Nina
  16. Universal social welfare orderings and risk By Marc Fleurbaey; Stéphane Zuber
  17. Sophistication about Self-Control By Deborah A. Cobb-Clark; Sarah C. Dahmann; Daniel A. Kamhöfer; Hannah Schildberg-Hörisch

  1. By: Wilson, Bart J.; Marese, Gian Marco
    Abstract: Following Adam Smith’s line of argument, we examine the semantics of four economic principles in Chapter III of the Wealth of Nations that compose his famous proposition “that the division of labour is limited by the extent of the market.” We apply the Natural Semantic Metalanguage framework in linguistics to produce a series of explications that are clear and plain, cross-translatable into any language, intelligible to twenty-first century readers, and faithfully close to the original text. Our paper explicates Smith’s logical argument in Chapter III and demonstrates how his ideas can be shared among speakers with different linguacultural backgrounds in line with the truly global view of economics that, we argue, Adam Smith had in mind: economics intended as the science of all people living and doing things together with other people to live well and to feel good.
    Date: 2021–08–24
  2. By: Matson, Erik W.
    Abstract: Smith’s discourses aim to encourage mores, practices, and public policies in service to the common good, or that which a universally benevolent spectator would approve of. The Wealth of Nations illustrates how in pursuing our own happiness within the bounds of prudence and commutative justice we may be said, literally or metaphorically, to cooperate with God in furthering the happiness of humankind. The Theory of Moral Sentiments elaborates an ethic, here called “focalism,” that instructs us to proportion our beneficent efforts to our knowledge and ability. The relationship between political economy and focalism is bidirectionally reinforcing. In one direction, the ethic of focalism contributes to the moral authorization of self-love, thereby invigorating and dignifying honest commercial activities. In the other direction, the insights of political economy reinforce the ethic of focalism by elaborating how through prudent commerce and focal beneficence we cooperate, even if only metaphorically, in a grand social enterprise.
    Date: 2021–08–24
  3. By: Roberto Censolo; Massimo Morelli
    Abstract: Industry, frugality and prudence can foster growth, and, in turn, growth can sustain individual beliefs that these virtues are the right recipe for the pursuing of happiness. This virtuous circle is an often emphasized contribution of Adam Smith. Equally important but neglected, is the Adam Smith's fear that the opposite vitious cycle can meterialize, especially at stages of development of commercial society characterized by stagnation, alienating working conditions and growming inequality: stagnation of wages, and the frustration coming from the perceived impossibility of trickle down effects from the growing wealth of the few, can degenerate moral sentiments, in ways that we can now associate to may of the current features of populism.
    Keywords: Adam Smith; Moral Sentiments; Secular Stagnation; Inequality
    JEL: B12 E71
    Date: 2021–09–03
  4. By: Greitens, Jan
    Abstract: Jeder, der sich mit Geld und Banken im Deutschen Reich in der ersten Hälfte des 20. Jahrhunderts beschäftigt, kennt den Namen Alfred Lansburgh. Die Frankfurter Allgemeine Zeitung nannte ihn "in Sachen des Geldes vielleicht einen der klügsten Menschen, die in Deutschland je gelebt und gearbeitet haben." Seine bekannteste Schrift "Vom Gelde" erfährt bis heute immer wieder Neuauflagen. Er hinterließ ein umfangreiches Werk, das ihn als langjährigen Beobachter, Analytiker und Kommentator aller Entwicklungen von Geld und Banken im späten Kaiserreich und in der Weimarer Republik ausweist. Allerdings ist wenig über seine Person und über seine theoretischen und politischen Ansichten bekannt. Die vorliegende Arbeit rekonstruiert die Biographie Alfred Lansburghs. Lansburgh war sein Leben lang ein überzeugter liberaler Publizist. Nach einer nicht besonders erfolgreichen Karriere im Bankwesen wurde er zunächst Wirtschaftsjournalist und dann Herausgeber einer der wichtigsten Wirtschaftszeitschriften seiner Zeit. Früher als kaum ein anderer hat er die während des Ersten Weltkriegs einsetzende Zerrüttung der Währung erkannt und dagegen angeschrieben. Aufgrund seiner jüdischen Abstammung wurde er ein Opfer des Nationalsozialismus, dessen Unterdrückung ihn in den Selbstmord trieb. Der Vorgang der "Arisierung" seines Verlages zeigt aber auch die Ambivalenz, in der sich die Akteure der damaligen Zeit befanden.
    Keywords: Lansburgh,Die Bank,Arisierung,Mellinger,Bank-Akademie
    JEL: B26 B31 N14
    Date: 2021
  5. By: Bateman, Bradley W.
    Abstract: Introduction to Symposium: Celebrating the Centenary of Keynes’s Treatise on Probability
    Date: 2021–08–24
  6. By: Rivot, Sylvie
    Abstract: When scholars investigate the legacy of Keynes’s Treatise on Probability (1921) for the development of Keynes’s thinking, the attention usually focuses on the connections between Keynes’s probability theory, his conception of decision-making under uncertainty and the theory of the functioning of the macroeconomic system that derives from it - through the marginal efficiency of capital, the preference for liquidity and the self-referential functioning of financial markets. By contrast, the paper aims to investigate the connections between Keynes’s probability theory on the one hand, and his economic policy recommendations on the other. It concentrates on the policy recommendations defended by Keynes during the Great Depression but also after the General Theory. Keynes’s economic policy can be understood as a framework for decision-making in situations of uncertainty: fiscal policy aims to induce private agents to change their “rational” probability statements, while monetary policy aims to allow more weight to these statements.
    Date: 2021–08–24
  7. By: Marouzi, Soroush
    Abstract: This paper is an attempt to historicize Frank Plumpton Ramsey’s Apostle talks delivered from 1923 to 1925 within the social and political context of the time. In his talks, Ramsey discusses socialism, psychoanalysis, and feminism. Ramsey’s views on these three intellectual movements were inter-connected, and they all contributed to his take on the then policy debates on the role of women in economy. Drawing on some archival materials, biographical facts, and the historiographical literature on the early inter-war politics of motherhood, I show that Ramsey held a positive view of the feminist campaign for family endowment. He demanded government financial support for motherhood in recognition of the economic significance of women’s domestic works and as what could bring economic independence to them. In addition, he found such economic scheme compatible with the kind of maternalism endorsed by Freudian psychoanalysis – his favorite theory of psychology.
    Date: 2021–08–23
  8. By: Schilirò, Daniele; Young, Warren
    Abstract: This paper analyzes the Econometric Society European Meetings (ESEMs) over the period 1931-39, highlighting the research programs produced by the meetings to show the influence that these meetings had on economics in that period and thereafter. The examination of the European Meetings in the 1930s highlights the range of topics discussed in these meetings, connections with ideas of the past economists such as Cournot, Pareto, and Walras among others, and the interest in relevant social and economic issues that characterized the decade. Also, the paper points to the emphasis placed on the quantitative approach to economic analysis taken by the European members of the Econometric Society, and their efforts to establish new lines of research accordingly.
    Keywords: Econometric Society; European meetings 1931-1939; quantitative approach; new lines of research
    JEL: B20 B23
    Date: 2021–08
  9. By: Vallois, Nicolas
    Abstract: In the early twentieth century, an economic doctrine known as “non-proletarianization theory” became influential among left-wing Zionists in Russia. According to this theory, Jewish workers were unable to “proletarianize”—that is, to integrate large-scale industry; hence, Jewish territorial autonomy was required, whether in Palestine or elsewhere. This article analyzes this theory’s historical development, focusing on the works of three authors: Khaim Dov Horovitz, Yakov Leshchinsky, and Ber Borochov. I claim that discussions of Jewish non-proletarianization can be considered a specific and coherent intellectual tradition in the history of economic thought. I also discuss these theories’ relation to the anti-sweatshop campaign of the Progressive Era, particularly John R. Commons’s writings on Jewish immigrants that were recently debated in this journal.
    Date: 2021–08–24
  10. By: Maylam, Paul
    Abstract: For forty or so years, from the 1930s to the mid-1970s, Desmond Hobart Houghton was one of South Africa’s most prominent economists, based throughout his academic career at Rhodes University. He belonged to the liberal school of economists who believed in the free market and modernization theory, being particularly influenced by W. Rostow’s stages of growth model which he applied to South Africa. The rural economy, migrant labor and regional development, with a particular focus on the Eastern Cape, were his major research interests. He authored a standard text on the South African economy. This article charts his career and thinking.
    Date: 2021–08–24
  11. By: Woods, John E
    Abstract: Surprisingly, Benjamin Graham, the acknowledged “Father of Value Investing”, considered his most important work to be the invention of the Commodity Reserve Currency Plan during the 1930s and 1940s. Previous studies of the Plan have overlooked the fact that, of its three main components (buffer stocks, price stability and currency–backing), Graham regarded the first as the most important and the other two as “secondary” or “subsidiary”. By focusing on the buffer–stock aspect, we demonstrate, first, the breadth and depth of Graham’s overall conception in terms of both micro– and macro-economics and, second, the considerable overlap with Keynes’s ideas developed around the same time, which are manifested particularly in their common conclusion that the inefficiency of commodity markets could be rectified only by government intervention. We also comment on Mehrling’s assessment of Graham as “not any kind of economist at all” (JHET, 2011).
    Date: 2021–08–24
  12. By: Richard Arena (Université Côte d'Azur, France; GREDEG CNRS); Muriel Dal Pont Legrand (Université Côte d'Azur, France; GREDEG CNRS); Roger Guesnerie (Collège de France)
    Date: 2021–08
  13. By: François Gardes (Centre d'Economie de la Sorbonne & Université Catholique de l'Ouest)
    Abstract: L'examen critique du cours de Pierre Bourdieu sur les fondements sociaux de l'action économique et sa comparaison à la méthodologie suivie par Simon Langlois dans ses analyses des choix de consommation des ménages, engendrent une discussion des méthodologies de test des hypothèses et des conclusions des analyses théoriques dans les diverses sciences sociales et l'exposé succinct de nouveaux modèles qui élargissent la théorie économique des choix individuels, répondant ainsi partiellement aux critiques de Bourdieu
    Keywords: Don; marché; rationalité; test; consommation
    JEL: A14 C52 C62 D11 D41 J52
    Date: 2021–01
  14. By: Klein, Ursula
    Abstract: Book Review of “ Scientific History: Experiments in History and Politics from the Bolshevik Revolution to the End of the Cold War” by Elena Aronova
    Date: 2021–08–25
  15. By: Eichacker, Nina
    Abstract: The Routledge Handbook of Heterodox Economics and Democratizing the Economics Debate: Pluralism and Research Evaluation, two recently published books about heterodox economics and its role in broader academic and policy discourses, serve as an antidote to some recent popular narratives equating economics and economists with policies that are inherently pro-market, anti-regulation, and based in neoclassical theories. These texts illuminate challenges in current economic discourse about (1) the place of economic pluralism, (2) the role economics and economists should play in guiding policy relative to other social science disciplines, and (3) the consequences of the reliance of policy-makers on economists that train at the most elite institutions that are likely to recommend a narrow band of policies informed by a restricted range of economic theories. The Routledge Handbook of Heterodox Economics, edited by Tae-Jee Ho, Lynne Chester, and Carlo D’Ippoliti, presents positive visions for new questions that heterodox economists are researching, alternative explanations for global economic dynamics, and a counter-narrative to the notion that economists are bound to propose neoliberal policies based on neoclassical and new classical economic theories, and that economic analysis must demonstrate causality using different statistical methodologies to validate its rigor. Carlo D’Ippoliti’s Democratizing the Economics Debate examines the dialectical process by which economic rankings prioritize economic work informed by a narrow range of theories, and serve as a springboard for economists studying and working at the most elite institutions to land in powerful government advisory positions. D’Ippoliti highlights the stakes for governments that continue to hire economic policymakers from these top-tier programs with limited demonstrated curiosity in theories that might be considered heterodox, and the benefits for the economics discipline as a whole for better engagement with pluralist economics writ large.
    Date: 2021–08–26
  16. By: Marc Fleurbaey (Paris School of Economics); Stéphane Zuber (Centre d'Economie de la Sorbonne, Paris School of Economics)
    Abstract: How to evaluate and compare social prospects when there may be a risk on i) the actual allocation people will receive; ii) the existence of these future people; and iii) their preferences? This paper investigate this question that may arise when considering policies that endogenously affect future people, for instance climate policy. We show that there is no social ordering that meets minimal requirements of fairness, social rationality, and respect for people's ex ante preferences. We explore three ways to avoid this impossibility. First, if we drop the ex ante Pareto requirement, we can obtain fair ex post criteria that take an (arbitrary) expected utility of an equally-distributed equivalent level of well-being. Second, if the social ordering is not an expected utility, we can obtain fair ex ante criteria that assess uncertain individual prospects with a certainty-equivalent measure of well-being. Third, if we accept that interpersonal comparisons rely on VNM utility functions even in absence of risk, we can construct expected utility social orderings that satisfy of some version of Pareto ex ante
    Keywords: Fairness; social risk; intergenerational equity
    JEL: D63 D81
    Date: 2021–06
  17. By: Deborah A. Cobb-Clark; Sarah C. Dahmann; Daniel A. Kamhöfer; Hannah Schildberg-Hörisch
    Abstract: We propose a broadly applicable empirical approach to classify individuals as time-consistent versus native or sophisticated regarding their self-control limitations. Operationalizing our approach based on nationally representative data reveals that self-control problems are pervasive and that most people are at least partly aware of their limited self-control. Compared to naifs, sophisticates have higher IQs, better educated parents, and are more likely to take up commitment devices. Accounting for both the level and awareness of self-control limitations has predictive power beyond one-dimensional notions of self-control that neglect awareness. Importantly, sophistication fully compensates for self-control problems when choices involve immediate costs and later benefits. Raising people’s awareness of their own self-control limitations may thus assist them in overcoming any adverse consequences.
    Keywords: self-control; sophistication; naiveté; commitment devices; present bias
    JEL: D91 D01
    Date: 2021

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