nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2011‒07‒27
five papers chosen by
Karl Petrick
University of the West Indies

  1. "The Global Crisis and the Remedial Actions: A Nonmainstream Perspective" By Sunanda Sen
  2. "The Rise and Fall of Export-led Growth" By Thomas I. Palley
  3. Acute Multidimensional Poverty: A New Index for Developing Countries By Alkire, Sabina; Santos, Maria Emma
  4. Aiming high, falling short: the Least Developed Country (LDC) category at 40 By Fialho, Djalita
  5. Ethical Consumer Behaviour: Can Critical Incidents Make a Difference? By Farhangmehr, Minoo; Malheiro, Alexandra; Soares, Ana

  1. By: Sunanda Sen
    Abstract: The global financial crisis has now spread across multiple countries and sectors, affecting both financial and real spheres in the advanced as well as the developing economies. This has been caused by policies based on "rational expectation" models that advocate deregulated finance, with facilities for easy credit and derivatives, along with globalized exposures for financial institutions. The financial crisis has combined with long-term structural changes in the real economy that trend toward underconsumption, generating contractionary effects therein and contributing to further instabilities in the financial sector. The responses so far from US monetary authorities have not been effective, especially in dealing with issues of unemployment and low real growth in the United States, or in other countries. Nor have these been of much use in the context of the lost monetary and fiscal autonomy in both developing countries and the eurozone, especially with the debt-related distress in the latter. Solutions to the current maladies in the global economy include strict control of financial speculation and the institution of an "employer of last resort" policy, both at the initiative of the state.
    Keywords: Global Crisis; Expectations; Underconsumption; Ponzi; Labor Flexibility
    JEL: E2 E4 E5 E6 J2 J3 J6
    Date: 2011–07
  2. By: Thomas I. Palley
    Abstract: This paper traces the rise of export-led growth as a development paradigm and argues that it is exhausted owing to changed conditions in emerging market (EM) and developed economies. The global economy needs a recalibration that facilitates a new paradigm of domestic demand-led growth. Globalization has so diversified global economic activity that no country or region can act as the lone locomotive of global growth. Political reasoning suggests that EM countries are not likely to abandon export-led growth, nor will the international community implement the international arrangements needed for successful domestic demand-led growth. Consequently, the global economy likely faces asymmetric stagnation.
    Keywords: Export-led Growth; Domestic Demand-led Growth; Economic Development; Stagnation
    JEL: F00 F01 F02 F10 F20 F50 O11 O19 O24
    Date: 2011–07
  3. By: Alkire, Sabina; Santos, Maria Emma
    Abstract: This paper presents a new Multidimensional Poverty Index (MPI) for 104 developing countries. It is the first time multidimensional poverty is estimated using micro datasets (household surveys) for such a large number of countries which cover about 78 percent of the world's population. The MPI has the mathematical structure of one of the Alkire and Foster poverty multidimensional measures and it is composed of ten indicators corresponding to same three dimensions as the Human Development Index: Education, Health and Standard of Living. The MPI captures a set of direct deprivations that batter a person at the same time. This tool could be used to target the poorest, track the Millennium Development Goals, and design policies that directly address the interlocking deprivations poor people experience. This paper presents the methodology and components in the MPI, describes main results, and shares basic robustness tests. --
    Keywords: Poverty Measurement,Multidimensional Poverty,Capability Approach,Multidimensional Welfare,Human Development,HDI,HPI
    JEL: I3 I32 D63 O1
    Date: 2011
  4. By: Fialho, Djalita
    Abstract: Why have 94% of LDCs not escaped poverty during the last four decades? This paper analyses the motivation behind the UN decision to establish the LDC category in 1971. The reviewed literature highlights the conflicting interests of the actors involved. It provides a historical account of the creation of the category and an international political economy analysis of that process. Based on this literature, I argue that the initial LDC identification process - which set a precedent for future LDC categorizations - was manipulated in order to generate a reduced list of small and economically and politically insignificant countries. Contrary to the LDC official narrative, this list served the interests of both donors (by undermining the UN's implicit effort to normalize international assistance) and other non-LDC developing countries (disturbed by the creation of a positive discrimination within the group, favoring the most disadvantaged among them). As a result of this manipulation, considerably less development-promoting efforts have been demanded from donors, which has, in turn, not significantly distressed the interests of other non-LDC developing countries. --
    Keywords: LDCs,aid,trade,preferential treatment,graduation
    JEL: N20 O19
    Date: 2011
  5. By: Farhangmehr, Minoo; Malheiro, Alexandra; Soares, Ana
    Abstract: The last two decades have been fruitful in the development of research into ethical consumer behaviour. Notwithstanding this growing interest, the majority of studies focuses on measuring consumers' ethical attitudes and beliefs, neglecting the understanding of actual behaviour. This investigation aims at a deeper understanding of ethical consumer behaviour. A qualitative approach, based on 20 interviews with Portuguese consumers was undertaken. Results reveal a typology of consumption issues identified by consumers as having a moral and social nature. Furthermore, results highlight that different critical episodes may impact ethical consumer behaviour.
    Keywords: Consumer Behaviour; Social Responsibility; Ethics
    Date: 2011

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