nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2017‒10‒01
six papers chosen by
Karl Petrick
Western New England University

  1. The Complexity of Economies and Pluralism in Economics By Claudius Graebner
  2. Financial Innovation and Money Demand: Evidence from Sub-Saharan Africa By J. Paul Dunne; Elizabeth Kasekende
  3. The Greek Dra(ch)ma: 5 Years of Austerity. The Three Economists’ View and a Comment. By Menelaos Karanasos; Panagiotis Koutroumpis; John Htgioannides; Marika Karanassou; Hector Sala
  4. Differences in Wealth, Education, and History By James Edward, Curtis Jr
  5. Basic Income and a Public Job Offer: Complementary Policies to Reduce Poverty and Unemployment By FitzRoy, Felix; Jin, Jim
  6. Communism - A survival analysis By Subramaniam, Viswanatha

  1. By: Claudius Graebner (Institute for Institutional and Innovation Economics (iino), University of Bremen, Germany)
    Abstract: rom the two premises that (1) economies are complex systems and (2) the accumulation of knowledge about reality is desirable, I derive the conclusion that pluralism with regard to economic research programs is a more viable position to hold than monism. To substantiate this claim I discuss an epistemological framework of how scholars study their objects of inquiry and relate their models to reality. Furthermore, I argue that given the current institutions of our scientific system, economics self-organizes towards a state of scientific unity. Since such a state is epistemologically inferior to a state of plurality, critical intervention is desirable.
    Keywords: Complexity, Pluralism, Epistemology, Cumulative Causation
    JEL: A1 A2 B4
    Date: 2017–09
  2. By: J. Paul Dunne (School of Economics, University of Cape Town); Elizabeth Kasekende (Bank of Uganda)
    Abstract: While the effect of financial innovation on money demand has been widely researched in industrialised countries, because of its major role in monetary policy, few studies have focussed on developing countries. This is surprising given the considerable growth in financial innovation in Sub-Saharan Africa in recent years and its potential implications for developing country macroeconomic policy. This paper investigates the development of financial innovation and its impact on money demand in the region using panel data estimation techniques for 34 countries between 1980 and 2013. The results indicate that there is a negative relationship between financial innovation and money demand. This implies that financial innovation plays a crucial role in explaining money demand in Sub-Saharan Africa and given innovations such as mobile money in the region this can have important implications for future policy design.
    Date: 2017
  3. By: Menelaos Karanasos; Panagiotis Koutroumpis; John Htgioannides; Marika Karanassou; Hector Sala
    Abstract: In this paper, we summarize the opinion of three renowned economists, namely Paul De Grauwe, Paul Krugman and Joseph Stiglitz, on the Eurozone crisis as well as on the Greek case. All three expressed in one way or another their reservations about the single currency. On the one hand, De Grauwe and Stiglitz highlighted the design failures of the Eurozone, and on the other Krugman argued that the creation of the common currency was a terrible mistake. In support of their claims we provide evidence of the negative consequences of the austerity measures that were implemented by the troika on the Greek economy for a period covering 2010-2014. After five years of austerity, Greece among others experienced significant deflationary dynamics, deep recession, high unemployment rates that are among the highest in Europe, and an increase of the percentage of the people at risk of poverty or social exclusion. More specifically, GDP per capita growth shrank on average by 5.85 percent in the period 2010-2013 while the unemployment rate reached 25.5 percent in 2015. Even more remarkable is the fact that the youth unemployment rate reached 52.4 percent in 2014. Finally, 14 percent of the population cannot meet its medical needs due to the high cost of treatment.
    Keywords: Eurozone crisis, Greece, Austerity measures, GREXIT
    Date: 2017–08
  4. By: James Edward, Curtis Jr
    Abstract: ABSTRACT An understanding of the freedoms (or the lack of freedoms) and their economic consequences on early black Americans provides an informative understanding to the freedoms (or the lack of freedoms), and their economic consequences on other, modern ethnic groups. James Curtis Jr (2017) investigates the link between the social asymmetry and economic asymmetry among early blacks and whites in the United States of America. For the empirical study, James Curtis Jr (2017) uses cross-sectional variables from the Integrated Public Use Microdata Sample (IPUMS), developed informative conditional ratios, and employed least squares statistical analyses. FINDINGS This study finds that economic differences among ethnic groups, as measured by differences between early blacks and whites, are intertwined with asymmetrical freedoms, leading to statistically insignificant returns to education, as measured by literacy. One might conclude that the individual’s basic protection of life, liberty, and the pursuit of happiness must proceed any expectations of measured returns to schooling, particularly among individuals in disenfranchised groups. Furthermore, one might propose education policy such that modern higher education investment programs prioritize education entrepreneurs and/or state/social planners with academic research familiarity of differences in wealth. This research is a revision of November 2002, November 2010 and January 2012 working papers. Copyright 2017. James Edward Curtis, Jr. is the President & Research Economist of The James Edward Curtis Jr Education Foundation, Correspond with James Edward Curtis, Jr. at PO Box 3126, Washington, District of Columbia 20010, or phone (202) 739-1962, email Learn more at
    Keywords: Education, History, Wealth
    JEL: C81 E21 I24 N00
    Date: 2017–09–22
  5. By: FitzRoy, Felix (University of St. Andrews); Jin, Jim (University of St. Andrews)
    Abstract: Unconditional basic income, or a job guarantee by government as employer-of-last-resort, are usually discussed as alternative policies, though the first does not provide the benefits of an earned income and a good job to the growing numbers in precarious- or under-employment, while the second fails to assist those who would prefer to remain in self-employment or particular occupations if their incomes were higher, rather than to work under a JG. Furthermore a JG cannot support those who are unwilling to work. We argue here that the only cost-effective policy for comprehensive welfare is a combination of a modest basic income with job offer by local authorities below the minimum wage.
    Keywords: basic income, job guarantee, poverty, unemployment
    JEL: H53
    Date: 2017–09
  6. By: Subramaniam, Viswanatha
    Abstract: Human generation try to fit into a 4 dimensional survival concepts comprising the Environment, Geography, Economic and Social dimensions, over centuries and their pedigree too progressed under these guidelines. Because of the divergent level of survival targets in the economic and social strata by each human being, wealth accumulation flows unequally among the people. Industrial revolution mechanised the human work, with cost reduction and quality/volume optimization and planted Capitalism in the world, creating a wedge in the wealth accumulation process. This inducted a class war between the owners of wealth versus the workers, who are hired and fired by them. Competition made the capitalist to realise the importance of labour and diluted their concept as “Socialism”. The disproportionate wealth accumulation among people seeded the concept of communism in the world. Communism originated by Marx in Germany, spread to Russia and was promoted by Lenin. Both assumed that the large volume of people in the world belong to the low wealth possessing worker class, will revolt towards equal wealth share, and Communism shall dominate the whole world soon. But both Marx and Lenin were “Social revolutionists” and lacked “futuristic management thoughts” on how the shared wealth will be recycled to grow more, and result in prosperity among the equally shared population ? With this limited thought, the USSR (1922) and the East Germany (GDR-1961) and were created, with the entire wealth of the nation pooled on the apex “State”, representing the entire population. The state became a monopoly and all the people were simple labourers, without any self possessions. The state utilised the labour like a commodity, without any motivation to use their original ideas and any incentive to improve the productive contribution spirit. As a result, the GDR collapsed in 1989 and the USSR dwindled in 1991, bringing an end to the 69 year old Communist concept. Also both started promoting the diametrically opposite Capitalist approach and established cooperation with the (imperialist) USA. Communism could have survived and continued as a guide for wealth and prosperity for all the nations and their people in the world, if the domestic population was considered as “superior” to the “state”. The national wealth owned by the “State” should have been invested in sectorial projects and entrusted to optimum group of people to work, manage and encouraged to meet a targeted quality volume. State should have met all needs of these groups of people. A reasonable share of the net gains should have been distributed in equal proportion to all the people involved, as an incentive. Below targets and loss should have been questioned and corrective action should have been taken. In addition, the productivity and management decision should have been oriented towards ‘socio-economic Development units”. The domestic investment should be made from domestic savings and domestic technology should be manned by the domestic labour.
    Keywords: basic needs, capitalism, central bank, communism, darwin, domestic, economic, engels, financial, fittest, groups, individual, investment, lenin, management, manpower, marx, pareto, people, productivity, rate of return, revolution, savings, sectors, social, socialism, state, surplus, survival, technology, wealth
    JEL: A13 A14 B41 D63 D78 E2 E22 E24 H11 O11 P12
    Date: 2017–09–21

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