nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2010‒11‒13
six papers chosen by
Karl Petrick
University of the West Indies

  1. Promising Avenues, False Starts and Dead Ends: Global Governance and Development Finance in the Wake of the Crisis By Ilene Grabel
  2. Conspicuous distinction: a reading of Veblen and Bourdieu By Isabel Guimarães; Eva Oliveira; M. Rocha
  3. Ecological, Heterodox and Neoclassical Economics: Investigating the Differences By Spash, Clive L.; Ryan, Anthony M.
  4. Action on Social Security: The Urgent Need for Delay By Dean Baker
  5. "How Brazil Can Defend Against Financialization and Keep Its Economic Surplus for Itself" By Michael Hudson
  6. What’s wrong with the world? Rationality! A critique of economic anthropology in the spirit of Jean Gebser By Pogany, Peter

  1. By: Ilene Grabel
    Abstract: Grabel addresses three related questions. How is the crisis affecting the governance of the IMF and the influence that developing countries have within the institution; the policy space available to developing countries; and the prospects that alternative financial architectures will emerge as competitors or complements to the Fund? At this point it appears that IMF practice on capital controls has changed partly as a consequence of the crisis, that relatively autonomous developing countries are taking advantage of the policy space that has emerged, and that the global financial architecture is becoming more heterogeneous and multi-nodal. Developing countries do not yet enjoy more formal influence at the IMF as a consequence of the crisis. However, it is premature to conclude now that the formal and informal influence of developing countries will not increase in the coming years.
    Keywords: Global financial crisis; policy space for development; International Monetary Fund; capital controls; regional financial governance; global governance
    JEL: E65 F53 O23
    Date: 2010
  2. By: Isabel Guimarães (Faculdade de Economia e Gestão, Universidade Católica Portuguesa (Porto)); Eva Oliveira (Faculdade de Economia e Gestão, Universidade Católica Portuguesa (Porto)); M. Rocha (Faculdade de Economia e Gestão, Universidade Católica Portuguesa (Porto))
    Abstract: The paper provides a comparative reading of two influential works of Veblen and Bourdieu, on cultural consumption. Approaches to consumers’ taste and preferences are predominantly essentialist. However, Veblen and Bourdieu focused on the relationship between consumption and social divisions. Their views are, nonetheless, contrasting. Veblen developed a somewhat speculative approach centred on waste and conspicuous consumption as evidence for the natural quest for social honour. Bourdieu drew on empirical research to argue that culture stems from class and is related to necessity. The concepts of habitus, cultural capital and field interact to provide a complex and detailed account of different tastes emerging within different social classes. The result is a variegated social space with different statuses and an ongoing struggle for the definition of ‘good” and “bad” taste.
    Keywords: conspicuous consumption, social distinction, cultural capital, field, habitus
    Date: 2010–10
  3. By: Spash, Clive L.; Ryan, Anthony M.
    Abstract: How heterodox are ecological economists and how ecological are heterodox economists? How do both differ, if at all, from neoclassical economists when addressing environmental problems? In 2009 we probed such questions by conducting an international survey at economic conferences on the environment and sustainability. This paper reports on surveys conducted at conferences of the European Society for Ecological Economics, the European Association of Environmental and Resource Economics, and the Association of Heterodox Economists. A key aim was to gain insight into the extent to which ecological economics can be described as a distinct field of research from orthodox environmental and resource economics. Conflict within the field has meant a prevalence of neoclassical articles and thought mixed in amongst more heterodox work. The question then arises are those participating in ecological economics ideologically and methodologically similar to those schools of thought falling under the heterodox economic umbrella or the orthodox? In addressing this question problems are identified with economic understanding of environmental problems and the lack of communication across schools and disciplines. Suggestions are made as to how we might, as a community of concerned scholars and activists, move forward.
    Keywords: Ecological economics; heterodox; neoclassical; methodology; ideology
    JEL: B40 Q0 B59
    Date: 2010–10–29
  4. By: Dean Baker
    Abstract: There is enormous public confusion (much of it deliberately cultivated) about the extent of Social Security’s projected shortfall. Many policymakers and analysts point out that projections from the Congressional Budget Office and the Social Security Trustees show the program to be out of balance in the long-term, therefore we would be best advised to make changes as soon as possible. This paper argues that supporters of the existing Social Security system should try to ensure that no major changes to the core program are implemented in the immediate future. It points out that: 1. There is good reason for believing that the public will be better informed about the financial state of Social Security in the future, in part because of the weakening of some of the main sources of misinformation; 2. Many more people will be directly dependent on Social Security in the near future. These people and their families will likely be strong defenders of the program; 3. The group of near-retirees, who may be the victims of early action, will desperately need their Social Security since they have seen much of their wealth eliminated with the collapse of the housing bubble; and 4. The concern over “maintaining the confidence of financial markets” is an empty claim that can be used to justify almost any policy.
    Keywords: social security, retirement, retirement age,
    JEL: H H6 H62 H63 H68 J J1 J14 J18 J3 J32 J38
    Date: 2010–11
  5. By: Michael Hudson
    Abstract: The post-1945 mode of global integration has outlived its early promise. It has become exploitative rather than supportive of capital investment, public infrastructure, and living standards. In the sphere of trade, countries need to rebuild their self-sufficiency in food grains and other basic needs. In the financial sphere, the ability of banks to create credit (loans) at almost no cost, with only a few strokes on their computer keyboards, has led North America and Europe to become debt ridden—a contagion that now threatens to move into Brazil and other BRIC countries as banks seek to finance buyouts and lend against these countries' natural resources, real estate, basic infrastructure, and industry. Speculators, arbitrageurs, and financial institutions using "free money" see these economies as easy pickings. But by obliging countries to defend themselves financially, they and their predatory credit creation are helping to bring the era of free capital movements to an end. Does Brazil really need inflows of foreign credit for domestic spending when it can create this at home? Foreign lending ends up in its central bank, which invests its reserves in US Treasury and euro bonds that yield low returns, and whose international value is likely to decline against the BRIC currencies. Accepting credit and buyout "capital inflows" from the North thus provides a "free lunch" for key-currency issuers of dollars and euros, but it does not significantly help local economies.
    Keywords: Financialization; Economic Statistics; International Economics; International Finance; Economic Rent
    JEL: F33 G15 H5 O16
    Date: 2010–11
  6. By: Pogany, Peter
    Abstract: Jean Gebser (1905-1973) was a multidisciplinary thinker whose ideas about human consciousness and the future inspire the following five vantage points for the heterodox critique of contemporary economic anthropology: (1) Characteristic attributes of consciousness and those of the environment surrounding the individual are equivalent, eliminating the possibility of single-minded, seamless, rational control, especially during macrohistoric phase transitions; (2) Diaphaneity as a mode of deep and comprehensive understanding (an approach that excludes latching on to any selectively focused explanation) will be needed to deal effectively with emerging global resource and environmental problems; (3) Costs in the form of irreversibly accumulating inaccessible energy shadows our evolving civilization, which our cultural conditioning portrays as pure progress; (4) Rationality, as the most laudable motivation for individuals, business firms and nations, has led to an unfounded techno-fetish; and, for various reasons, it fuels accelerated movement toward collective self-destruction; (5) Signs of chaos (not the harmless and controllable kind found in standard economic literature) corroborate the notion that we have entered a new period of macrohistoric phase transition as interpreted by the thermodynamic comprehension of universal history.
    Keywords: Jean Gebser;global economy;universal history;resource constraints;entropy law;bifurcation;chaos theory;
    JEL: N01 P00 Z10 P51 B29 Q01 Z13
    Date: 2010–11–05

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