nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2011‒06‒04
eleven papers chosen by
Karl Petrick
University of the West Indies

  1. Postkeynesian Precepts for Nonlinear, Endogenous, Nonstochastic, Business Cycle Theories By K. Vela Velupillai
  2. The MONIAC, Modeling, and Macroeconomics By David Colander
  3. The MONIAC Updated for the Era of Permanent Financial Crisis By Robert Leeson
  4. To the Beat of Different Drumer....Freedom, Anarchy and Conformism in Research By K. Vela Velupillai
  5. Keynes’s missing axioms By Kakarot-Handtke, Egmont
  6. Cinco modelos de capitalismo By Pereira, Luiz Carlos Bresser
  7. What is wrong with heterodox economics? Kalecki’s profit theory as an example By Kakarot-Handtke, Egmont
  8. "Income Distribution in a Monetary Economy: A Ricardo-Keynes Synthesis" By Nazim Kadri Ekinci
  9. Teaching Macroeconomics after the Crisis: A Survey among Undergraduate Instructors in Europe and the U.S. By Gärtner, Manfred; Griesbach, Björn; Jung, Florian
  10. Trust, Trustworthiness, Relational Goods and Social Capital: A Cross-Country Economic Analysis By Paul Downward; Tim Pawlowski; Simona Rasciute
  11. Schumpeter and the essence of profit By Kakarot-Handtke, Egmont

  1. By: K. Vela Velupillai
    Date: 2011
  2. By: David Colander
    Date: 2011
  3. By: Robert Leeson
    Date: 2011
  4. By: K. Vela Velupillai
    Abstract: In this paper I attempt to make a case for promoting the courage of rebels within the citadels of orthodoxy in academic research environments. Wicksell in Macroeconomics, Brouwer in the Foundations of Mathematics,Turing in Computability Theory, Sraffa in the Theories of Value and Distribution are, in my own fields of research, paradigmatic examples of rebels, adventurers and non-conformists of the highest calibre in scientific research within University environments. In what sense, and how, can such rebels, adventurers and nonconformists be fostered in the current University research environment dominated by the cult of picking winners? This is the motivational question lying behind the historical outlines of the work of Wicksell, Brouwer, Hilbert, Bishop, Veronese, Gödel, Turing and Sraffa that I describe in this paper. The debate between freedom in research and teaching and the naked imposition of correct thinking, on potential dissenters of the mind, is of serious concern in this age of austerity of material facilities. It is a debate that has occupied some the finest minds working at the deepest levels of foundational issues in mathematics, metamathematics and economic theory. By making some of the issues explicit, I hope it is possible to encourage dissenters to remain courageous in the face of current dogmas.
    Keywords: Non-conformist research, macroeconomics, foundations of mathematics, intuitionism, constructivism, formalism, Hilbertís Dogma, Hilbertís Program, computability theory
    Date: 2010
  5. By: Kakarot-Handtke, Egmont
    Abstract: Between Keynes’s verbalized theory and its formal basis persists a lacuna. The conceptual groundwork is too small and not general. The quest for a comprehensive formal basis is guided by the question: what is the minimum set of foundational propositions for a consistent reconstruction of the money economy? We start with three structural axioms. The claim of generality entails that it should be possible to prove that Keynes’s formalism is a subset of the structural axiom set. The axioms are applied to a central part of the General Theory in order to achieve consistency and generality.
    Keywords: New framework of concept; Structure-centric; Axiom set; Full employment; Intermediate situation; Emergent money; Singularity; System immanent risk; Distributed profit; Saving; Investment; Allais-Identity
    JEL: E12 E25 E31 E24 E40 B41
    Date: 2011–05–14
  6. By: Pereira, Luiz Carlos Bresser
    Abstract: Besides analyzing capitalist societies historically and think them in terms of phases or stages, we may compare different models or varieties of capitalism. In this work I make a survey of the literature on this subject, distinguish the classification that have a production or business approach to the ones that use mainly a political criterion. And present my own view on the matter that views five forms of capitalism. Among the rich countries, I see the “liberal-democratic or Anglo-Saxon model, the social or European model, and endogenous social integration or Japanese model; among developing countries, I distinguish the Asian developmental model from the liberal-dependent model that characterizes most other developing countries including Brazil.
    Date: 2011–05–16
  7. By: Kakarot-Handtke, Egmont
    Abstract: Kalecki’s profit theory has always been popular among heterodox economist as an alternative approach to solve the paradox of monetary profits. In the present paper his formula ‘The workers spend what they get, the capitalists get what they spend’ is scrutinized for its logical and factual implications. The analysis shows that Kalecki’s alternative approach points in the right direction but unfortunately shares a crucial conceptual error with standard economics.
    Keywords: National income accounting; Zero profit economy; Distributed profit; Income definition; Master equation
    JEL: E12 E25 B22 B50 B41
    Date: 2011–05–18
  8. By: Nazim Kadri Ekinci
    Abstract: The paper provides a novel theory of income distribution and achieves an integration of monetary and value theories along Ricardian lines, extended to a monetary production economy as understood by Keynes. In a monetary economy, capital is a fund that must be maintained. This idea is captured in the circuit of capital as first defined by Marx. We introduce the circuit of fixed capital; this circuit is closed when the present value of prospective returns from employing it is equal to its supply price. In a steady-growth equilibrium with nominal wages and interest rates given, the equation that closes the circuit of fixed capital can be solved for prices, implying a definitive income distribution. Accordingly, the imputation for fixed capital costs is equivalent to that of a money contract of equal length, which is the payment per period that will repay the cost of the fixed asset, together with interest. It follows that if capital assets remain in use for a period longer than is required to amortize them, their earnings beyond that period have an element of pure rent.
    Keywords: Income Distribution; Circuits of Capital; Monetary Economy
    JEL: D33 D46 E11 E12 E25
    Date: 2011–05
  9. By: Gärtner, Manfred; Griesbach, Björn; Jung, Florian
    Abstract: An online survey among undergraduate macroeconomics instructors reveals that roughly half of them were scared when the crisis erupted and remain wary that more may be in the offing. As regards teaching, courses feature much the same lineups of models as they did before the crisis. A striking change concerns public debt dynamics, which receives much more emphasis. Regarding the finer fabric of undergraduate macro teaching, exciting things are going on. A host of topics related to financial markets has entered the curriculum, and there is more interest in economic history, the history of economic thought and case studies.
    Keywords: Financial crisis, teaching, undergraduate, macroeconomics.
    JEL: A22 E00
    Date: 2011–05
  10. By: Paul Downward (Loughborough University); Tim Pawlowski (German Sport University Cologne); Simona Rasciute (Loughborough University)
    Abstract: For a sample of 34 countries, this paper examines the impact that relational goods have on trust and, more specifically, trustworthiness; that is the degree of trust placed in others. Relational goods emanate from social interactions, which can be viewed as underpinning the development of social capital in the sense of helping to form trust in society. The relational goods examined comprise both informal activities such as meeting with family and friends, as well as more formal but voluntary association connected with participation in cultural, political, civic, sport and religious organisations. As the measure of trust comprises an ordered variable, a variety of ordered estimators are applied to the data, including attempts to account for the country-specific grouping of observation and, as a consequence, unobserved heterogeneity. The results suggest that whilst informal relational activities tend to generate trustworthiness, consistent with the concept of ‘thick’ trust, along with cultural and civic association and frequent political association, there is less evidence that sports does. In addition, the results suggest that religious association can actually reduce trustworthiness along with less frequent political association. Therefore, the results suggest, that it is the type and frequency of associational activity that contributes to the development of trustworthiness, rather than its existence per se.
    Keywords: Trust, relational goods, social capital
    JEL: D60 I31 C25
    Date: 2011–05
  11. By: Kakarot-Handtke, Egmont
    Abstract: Schumpeter had a clear vision of the developing economy, but he did not formalize it. The quest for a germane formal basis is in the following guided by the general question: what is the minimum set of foundational propositions for a consistent reconstruction of the evolving money economy? We start with three structural axioms. The claim of generality entails that it should be possible to free Schumpeter’s approach from its irksomeWalrasian legacy and to give a consistent formal account of the elementary circular flow that served him as a backdrop for the analysis of the entrepreneur-driven market system.
    Keywords: New framework of concepts; Structure-centric; Axiom set; Profit; Money; Credit; Structural stress; Catching-up process; Monopoly
    JEL: E25 E30 E10 E40 B41
    Date: 2011–05–29

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