nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2018‒01‒01
six papers chosen by
Karl Petrick
Western New England University

  1. "Minsky's Financial Fragility: An Empirical Analysis of Electricity Distribution Companies in Brazil (2007-15)" By Ernani Teixeira Torres Filho; Norberto Montani Martins; Caroline Yukari Miaguti
  3. Unhinged: Industrial relations liberalization and capitalist instability By Baccaro, Lucio; Howell, Chris
  5. "How Time Deficits and Hidden Poverty Undermine the Sustainable Development Goals" By Ajit Zacharias
  6. Renewing Literature Reviews in MIS Research? A Critical Realist Approach By François-Xavier De Vaujany; Nathalie Mitev; Matthew Smith; Isabelle Walsh

  1. By: Ernani Teixeira Torres Filho; Norberto Montani Martins; Caroline Yukari Miaguti
    Abstract: The present paper applies Hyman P. Minsky's insights on financial fragility in order to analyze the behavior of electricity distribution companies in Brazil from 2007 to 2015. More specifically, it builds an analytical framework to classify the firms operating in this sector into Minskyan risk categories and assess how financial fragility evolved over time, in each firm and in the sector as a whole. This work adapts Minsky's financial fragility indicators and taxonomy to the conditions of the electricity distribution sector and applies them to regulatory accounting data for more than 60 firms. This empirical application of Minsky's theory for analyzing firms engaged in the provision of public goods and services is a novelty. The results show an increase in the financial fragility of those firms (as well as the sector) throughout the period, especially between 2008 and 2013, even though the number of firms operating at the highest level of financial risk hardly changed.
    Keywords: Minsky; Financial Fragility; Financial Instability Hypothesis; Electricity Distribution Companies
    JEL: G31 G38 H40 L59 L94
    Date: 2017–09
  2. By: Giovanni Scarano
    Abstract: Subsequent to the financial crisis of 2007-2008 there has been a revival of theories on the possibility of a “secular stagnation”. Some of these theories hark back to Alvin Hansen’s doctrine, developed on Keynesian bases. Nevertheless, they have shifted attention toward a disproportion between saving and investment only explained on the basis of demographic and technological factors, typical of a neoclassical framework of growth theory. However, the idea that neo-capitalist economies have an inherent tendency to stagnation has also long been the main research objective of many heterodox economists, in particular Kaleckian and neo-Marxist, who found stagnation to be a major result of the monopolistic nature of big corporations and the features of their monopolistic forms of competition. The paper deals with some of these theories and focuses on the role that corporate governance in big corporations can play in producing growing corporate savings and putting them into financial channels.
    Keywords: Stagnation, Capacity Utilization, Corporate Savings, Financialisation, Financial Crises.
    JEL: B51 E11 E12 E32 G35
    Date: 2017–12
  3. By: Baccaro, Lucio; Howell, Chris
    Abstract: This paper makes two interrelated arguments. First, based on case studies of Sweden and Germany, it argues for a generalized liberalization trend in industrial relations, affecting not just "liberal" but also "coordinated" forms of capitalism. In coordinated economies, liberalization has not taken place primarily through outright deregulation, but has involved alternative mechanisms that increase employer discretion without fundamentally altering the form of existing institutions. Second, the paper links the liberalization of industrial relations to "secular stagnation" - i.e., to the growing difficulty that all advanced economies have in generating adequate levels of aggregate demand. It argues that strong unions and centralized collective bargaining were cornerstones of the wage-led Fordist model, and that the liberalization of industrial relations has undermined a crucial institutional channel for transmitting productivity increases into real wages and aggregate demand. Post-Fordist growth models are based on alternative drivers of growth, but they are all fundamentally unstable.
    Keywords: capitalism,liberalization,industrial relations,secular stagnation,Europe,Kapitalismus,Liberalisierung,industrielle Beziehungen,säkulare Stagnation,Europa
    Date: 2017
  4. By: Saverio M. Fratini
    Abstract: Absolute rent, in Marx’s view, has an upper limit represented by the difference between the value and the price of production of agricultural commodities. The actual relevance of this limit was questioned by Bortkiewicz and other scholars because of the difficulties concerning the argument which Marx based it on. The lack of this upper limit prompted a number of scholars to claim that there is no difference between absolute rent and a rent paid by a monopoly price. Referring to the classical/Marxian theory of monopoly price, we shall argue that is still possible— notwithstanding the missing upper limit—to distinguish absolute rent from a rent actually due to a monopoly price. In particular, the difference between the two rests on the removability (in the case of absolute rent) or the persistency (in the case of monopoly rent) of the obstacle to the expansion of agricultural production.
    Keywords: Marx, Bortkiewicz, absolute rent, monopoly price, effectual demand
    JEL: B12 B14 B51 Q15
    Date: 2017–12
  5. By: Ajit Zacharias
    Abstract: The predominant framework for measuring poverty rests on an implicit assumption that everyone has enough time available to devote to household production or enough resources to compensate for deficits in household production by purchasing market substitutes. Senior Scholar Ajit Zacharias argues that this implicit bias in our official poverty statistics threatens to undermine the Sustainable Development Goals (SDGs). The SDGs include the following targets: (1) reduce the incidence of poverty by 50 percent by 2030, and (2) recognize and provide support to the unpaid provision of domestic services and care of persons undertaken predominantly by women in their households. This policy note suggests that a closer link exists between poverty reduction and support for household production activities than is commonly acknowledged. Failure to recognize the link in policy design can contribute to failure on both fronts. To obtain a more accurate assessment of poverty, time deficits in household production must be taken into account.
    Date: 2017–11
  6. By: François-Xavier De Vaujany (DRM - Dauphine Recherches en Management - Université Paris-Dauphine - CNRS - Centre National de la Recherche Scientifique); Nathalie Mitev (LSE - Department of Management - London School of Economics and Political Science - LSE - London School of Economics and Political Science); Matthew Smith (autre - AUTRES); Isabelle Walsh (autre - AUTRES)
    Abstract: Literature Reviews (LR) are particularly useful for demonstrating the coherence and cumulativeness (or lack thereof) of MIS research and for developing avenues for further research. Most top-tier journals now publish LRs, and many have even begun devoting specific sections to them. Our starting point is that LRs are not epistemologically neutral, and three approaches commonly underlie literature reviews: positivism (identifying the concepts, theories and models closest to the phenomenon that is being explained); interpretivism (identifying the various concepts and theories expressed by various actors and grouping them into multiple perspectives); and critical approaches (identifying both the underlying assumptions and conditions of the production of theories and their effects). We suggest a fourth approach to LRs underpinned by the philosophy of critical realism (CR) and argue that it can enable the (re)interpretation of existing literature through the identification of underlying generative mechanisms. These generative mechanisms provide a common denominator to enable the synthesis of concepts and theories in new ways, helping to bridge previously thought to be incompatible theories, and contributing to a more cumulative view of academic knowledge. We illustrate the value of a CR-based literature through its application to the topic of IT Strategic Value in the MIS and strategic management literature; we show how the identification of four generative mechanisms and three core agencies can support a more integrated view of IT Strategic Value. We then discuss the implications of the use of generative mechanisms and propose guidelines from a CR perspective for carrying out literature reviews.
    Keywords: Literature review,Information Technology (IT),critical realism,strategic value,generative mechanism
    Date: 2017–11–24

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