nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2008‒02‒23
three papers chosen by
Karl Petrick
University of the West Indies

  1. The Remarkable Place of the UV-Curve in Economic Theory By Peter Rodenburg
  2. Investment behaviors of the key actors in capitalism: when geography matters By Claude DUPUY (GREThA-GRES); Stéphanie LAVIGNE (LEREPS-GRES & Toulouse Business School
  3. On the Scientific Status of Economic Policy: A Tale of Alternative Paradigms By Giorgio Fagiolo; Andrea Roventini

  1. By: Peter Rodenburg (University of Amsterdam)
    Abstract: The purpose of this paper is to provide an analysis of the impact the UV-curve had on economic theory and to provide an account of the subsequent radical changes in its place and role over the decades since its first appearance in 1958. The paper traces the historical development of the UV-curve and argues that the role of the UV-curve has changed from a measuring device to a graphical representation of full employment to an axiom necessary for matching models of unemployment. This changing role is best understood in the light of a paradigmatic change from Keynesianism to neoclassical search theory.
    Keywords: UV-curve; Beveridge curve; UV-analysis; Matching models; Theories of Unemployment; History of Economic Thought; Induction; Full employment; Measurement of unemployment
    JEL: B E J
    Date: 2007–11–16
  2. By: Claude DUPUY (GREThA-GRES); Stéphanie LAVIGNE (LEREPS-GRES & Toulouse Business School
    Abstract: The article investigates the geography of finance via an analysis of the investment behavior of large international equity investors. The main argument is based on the importance of financial markets and capital flows and on the central role played in them by institutional investors, the key actors of capitalism. This paper is original because it introduces geographic criteria, and thus institutional and cultural factors, for understanding the behaviour of investors. We present evidence on the diversity of models of capitalism while questioning the convergence of national economies and markets towards a pattern often termed “the Anglo-Saxon model”.
    Keywords: institutional investors, geography of finance, models of capitalism, financial markets
    JEL: G15 G23 R00 P10
    Date: 2008
  3. By: Giorgio Fagiolo; Andrea Roventini
    Abstract: In the last years, a number of contributions has argued that monetary -- and, more generally, economic -- policy is finally becoming more of a science. According to these authors, policy rules implemented by central banks are nowadays well supported by a theoretical framework (the New Neoclassical Synthesis) upon which a general consensus has emerged in the economic profession. In other words, scientific discussion on economic policy seems to be ultimately confined to either fine-tuning this "consensus" model, or assessing the extent to which "elements of art" still exist in the conduct of monetary policy. In this paper, we present a substantially opposite view, rooted in a critical discussion of the theoretical, empirical and political-economy pitfalls of the neoclassical approach to policy analysis. Our discussion indicates that we are still far from building a science of economic policy. We suggest that a more fruitful research avenue to pursue is to explore alternative theoretical paradigms, which can escape the strong theoretical requirements of neoclassical models (e.g., equilibrium, rationality, etc.). We briefly introduce one of the most successful alternative research projects -- known in the literature as agent-based computational economics (ACE) -- and we present the way it has been applied to policy analysis issues. We conclude by discussing the methodological status of ACE, as well as the (many) problems it raises.
    Keywords: Economic Policy, Monetary Policy, New Neoclassical Synthesis, New Keynesian Models, DSGE Models, Agent-Based Computational Economics, Agent-Based Models, Post-Walrasian Macroeconomics, Evolutionary Economics.
    Date: 2008–02–14

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