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on History and Philosophy of Economics |
| By: | Campagnolo, Gilles |
| Abstract: | Carl Menger is remembered less for his analysis of entrepreneurship (which in the following analysis refers to his fundamental notions related to the nature of business practice) than for his views on matters like money, individualism or the nature of institutions (there are exceptions to this subdued interest, such as Kirzner 1978). However, these issues are related and a long-debated notion among Austrians, namely time, relates investment, entrepreneurship, uncertainty and Menger’s tentative quasi-anthropology (kept in his notes). This paper conscientiously investigates those issues through Menger’s views on the notion of time. |
| Keywords: | Böhm-Bawerk (Eugen von); entrepreneurship; innovation; Menger (Carl); time |
| JEL: | B13 B31 O31 |
| Date: | 2022–09–03 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:117195&r=hpe |
| By: | Bernard Gazier (Centre d'Economie de la Sorbonne) |
| Abstract: | This text aims at identifying and discussing the content and present meaning of Blaise Pascal's contribution to the understanding of justice in economic matters: which inequalities in terms of wealth, status and power are acceptable or not in a country or a community? Such a project faces a difficulty and a paradox. The difficulty is that economics as a separate discipline does not exist in Pascal's times; the paradox lies in the fact that while Pascal was politically conservative, his heirs in the XXth century converge in a strongly critical stance against capitalism and established order. Our analysis proceeds in three steps. In the first step, we briefly situate Pascal's approach in its historical context, by comparing it to the views of other authors of his time who are considered as forerunners of political economy. In the second, we discuss the content of the legacy as identified and used in the XXth century, by comparing Pascal's statements on justice to the conceptions of his heirs, in order to pinpoint convergences and divergences. The last step adopts an epistemologic and genealogic stance. We take into consideration the long-terme changes in knowledge modalities leading to the "human sciences" and among them to "positive" and "normative" economics, in order to set and discuss the meaning of the references to Blaise Pascal in contemporary debates on economic and social justice |
| Keywords: | Blaise Pascal; social justice; normative economics |
| JEL: | B11 B50 B55 D60 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:24003&r=hpe |
| By: | Khan, Haider |
| Abstract: | What does a deep structural causal explanation for uneven development deliver ? To answer this question, we must ask: How are relatively deeper scientific explanations to be distinguished from superficial or shallower ones? Furthermore, what roles can counterfactual analysis play in social sciences and policy making which can help overcome uneven and unequal development? For a competent, morally motivated scientific policy maker in Development Economics, it is important to avoid inflicting harm and promote the common good. The purpose of this paper is to clarify how the idea of depth can play a role in finding the more "approximately true" explanation through causal comparisons and counterfactual conditionals that are scientifically salient in principle. In doing so, we must also be able to avoid inflicting harm and promote the common good. It is not an exhaustive treatment but rather focuses on a few aspects that may be the most critical in evaluating the explanatory strengths of a theory in the social sciences. It presents on the critical side a general argument which stresses the need for going beyond the Humean focus on just constant conjunction and temporal succession. On the positive side---and in contradistinction with Hume--- it develops a scientific realist argument for deep causality in development studies and social sciences in general on the epistemological, ontological and ethical side. It attempts to elucidate via an extensive example from research in the political economy of development how these ends can be achieved in a topic-specific manner when explanations in political economy and other social sciences can be judged by the scientific realist criterion of causal depth. In this particular case, an "intentional" and methodologically individualist neoclassical explanation is contrasted with a "structural" dual-dual approach as rival theories purporting to explain the same set of phenomena. Finally, avoiding harmful policies and aiding in making policies for advancing the common good are more likely if the methodological approach advocated here is adopted for responsible practice. Ultimately, following the methodology advanced here , it will be possible to drive further the tendencies towards the creation of an ethically efficacious economics(EEE) for ecologically sustainable humane policy making. |
| Keywords: | Uneven Development, Structural Dual-Dual Development Model, Scientific Explanations, Social and Economic Explanations, Causal Depth, Critical Scientific Realism, Political Economy, Neoclassical Economics, Structuralism, Social Science Theories, Economic Models, Ethics and Economics, Counterfactuals and Causal Efficacy, Common Good. Economic Justice, Ethically Efficacious Economics(EEE or Triple E) |
| JEL: | C3 O1 O2 |
| Date: | 2024–02–29 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120348&r=hpe |
| By: | Foster, Gigi; Frijters, Paul |
| Abstract: | In 2020 and 2021, the world witnessed policies that caused enormous net damage to most countries. We demonstrate the usefulness of the new WELLBY currency in gauging the costs and benefits of COVID policies and review the contributions of Australian economists to the scholarly and public debates about these policies. Our analysis documents the value of what was destroyed, the weak resistance mounted by the Australian economics profession during this period, and the role played by many Australian economists as apologists for what we view as Australia's most catastrophic peacetime economic policy failure. We close with ideas for working towards a better future. |
| Keywords: | Australia; Covid-19; economics profession; health policy; welfare; WELLBY; coronavirus |
| JEL: | N0 |
| Date: | 2024–03–06 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:122384&r=hpe |
| By: | Sandye Gloria (Université Côte d'Azur, CNRS, GREDEG, France) |
| Abstract: | What gives complexity economics its identity is the relationships and hierarchy among its ontological, epistemological, methodological, and conceptual aspects. This paper explores each one of these aspects and their interplays, to precise the contours of the complexity approach. This paper aims to stress the coherent articulation and architecture of these four dimensions. In particular, ontology matters, it comes first as an indispensable pre-scientific analysis that conditions the adoption of an adequate criterion of scientific explanation with methodological consequences in terms of relevant tools and key concepts. Reflections on the concept of emergence are particularly symptomatic of the overall coherence of the complexity approach. It becomes challenging to persist in attempting to enhance the mainstream with new tools to address novel phenomena and, more broadly, to regard the complexity approach as a supplement. Instead, the complexity approach emerges as a distinct alternative approach. |
| Keywords: | Complexity economics, ontology, generativism, constructivism, emergence |
| JEL: | B20 B50 B41 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2024-11&r=hpe |
| By: | Julien Grandjean; Cameron M. Weber |
| Abstract: | Reading Boulding’s The Image: Knowledge in Life and Society (1956) in light of recent work in public choice homo politicus theory sheds light on today’s partisan politics. Complex depersonalized societies and limited time in the democratic process means that voters make non-logical decisions based on expressive images as simple as “good” and “bad” (Brennan 2008). We find that this work by Boulding can be related to Downs (1957). In his well-known An Economic Theory of Democracy, Downs develops the importance of political ideology in electoral processes. But what is ideology if not expressive images? In this paper, we relate these two works, written at the same time, about the same subject but without referencing each other. Both Boulding and Downs build models which place an emphasis on the role of mental ideas to overcome imperfect information in representative democracy. Additionally, both theorists find that this uncertainty is what can make democracy a fragile form of governance. |
| Keywords: | Anthony Downs, Kenneth Boulding, Political ideology, Images, Democracy. |
| JEL: | B2 B31 D72 D81 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2024-14&r=hpe |
| By: | Harald Hagemann (Universität Hohenheim) |
| Abstract: | The essay begins with Hayek's grappling with the equilibrium framework as the starting point for the analysis of cyclical fluctuations and the fundamental methodological challenge raised by Lowe's attack against the construction of business-cycle theory within the system of general economic equilibrium. It then shows that Hayek elaborated his Austrian theory of the business cycle on the innovative combination of five building blocks: (1) Wicksell's theory of the cumulative process where price changes are caused by the discrepancy between the market rate and the natural (equilibrium) rate of interest; (2) Mises's theory of money and credit in which banks artificially lowering the money (market) rate of interest are responsible for overinvestment and a misallocation of resources which necessarily has to be corrected; (3) Böhm-Bawerk's theory of capital with its emphasis on the time structure of the production process; (4) Cantillon effects of changes in the money supply on the price structure and hence on the structure of production (non-neutrality of money); (5) Ricardo effects of a shortage of consumption goods on the production of investment goods (disproportionality of circulating and fixed capital). |
| JEL: | B22 B25 B31 E32 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2024-06&r=hpe |
| By: | Leonello Tronti |
| Abstract: | The paper summarizes the evolution of the welfare state concept and its link to economic growth and full employment, along a complex itinerary running for more than a century, from the work of Adolf Wagner (1878) to James Meade’s proposals (1989, 1995). The overview focuses on the theoretical links of the first experiments of the welfare state with the foundation of welfare economics (Pigou, 1920), the establishment of the concept of human capital (Knight, 1944; Schultz, 1961) and the systematization of the welfare state design offered by Beveridge (1942). In the same years, the full employment goal is affirmed as achievable (Keynes, 1936; Beveridge, 1944; Roosevelt, 1945), meanwhile the Italian Constitution (1948) proposes a major advance, affirming full employment as a substantive freedom. With the end of Bretton Woods (1971) and the oil shocks (1973, 1979) stagflation spreads to developed economies, and both the welfare state and full employment face a setback. Wagner’s law finds a more evolved expression in the Laffer curve (1974), while monetary policy becomes restrictive and full employment has to give way to the Nairu (Modigliani and Papademos, 1975; Tobin, 1980). This is the climate in which Meade proposes a new and vital link between the welfare state and full employment: a proposal in which worker shares combine with topsy-turvy nationalization, and public credit with the social dividend. A proposal out of the box, but worth reflecting on in depth |
| Keywords: | Welfare state; Wagner law; full employment; welfare economics; human capital; substantial freedom; capabilities; stagflation; fiscal crisis; Nairu; Laffer curve; social dividend |
| JEL: | P16 E24 E64 H53 I31 J53 M52 |
| URL: | http://d.repec.org/n?u=RePEc:ast:wpaper:0061&r=hpe |
| By: | Jean Daniel BOYER |
| Abstract: | In The Rules of Sociological Method, Emile Durkheim proposes a specific object for sociology, namely the social fact, which he defines as a social force. While, logically, it seems he would have had to transpose the methods of the physical sciences in order to study such an object, Durkheim in fact prefers those of the biological sciences. His initial project is therefore quickly transformed. We propose to take a step back, and to consider the perspectives on sociology that Durkheim opens up in the Rules, in particular the possibility of conceiving sociology as a “social physics”. By using quantitative methods, sociology could unveil the nature as well as the intensity of the social forces which determine human behaviours. Social facts would thus appear as forces, but also as probabilities that certain human behaviours would occur. Thus, sociology would be tasked to reconstruct the causes of the advent of both social facts and of social phenomena by using quantitative series. In this context, sociology could also be a predictive science. |
| Keywords: | Durkheim, force, method, social fact, social physics. |
| JEL: | A12 A14 B40 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2024-13&r=hpe |
| By: | Stark, Oded (University of Bonn) |
| Abstract: | Sen (1973 and 1997) presents the Gini coefficient of income inequality in a population as follows. "In any pair-wise comparison the man with the lower income can be thought to be suffering from some depression on finding his income to be lower. Let this depression be proportional to the difference in income. The sum total of all such depressions in all possible pair-wise comparisons takes us to the Gini coefficient." (This citation is from Sen 1973, p. 8.) Sen's verbal account is accompanied by a formula (Sen 1997, p. 31, eq. 2.8.1), which is replicated in the text of this note as equation (1). The formula yields a coefficient bounded from above by a number smaller than 1. This creates a difficulty, because the "mission" of a measure of inequality defined on the unit interval is to accord 0 to perfect equality (maximal equality) and 1 to perfect inequality (maximal inequality). In this note we show that when the Gini coefficient is elicited from a neat measure of the aggregate income-related depression of the population that consists of the people who experience income-related depression, then the obtained Gini coefficient is "well behaved" in the sense that it is bounded from above by 1. We conjecture a reason for a drawback of Sen's definition, and we present repercussions of the usage of the "well-behaved" Gini coefficient. |
| Keywords: | Sen's definition of the Gini coefficient of income inequality, aggregate income-related depression of a population, a "well-behaved" Gini coefficient |
| JEL: | D31 D63 I31 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16856&r=hpe |