nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2019‒04‒22
eight papers chosen by
Karl Petrick
Western New England University

  1. The Smithian Market of Religions and its Legacy: Another Great Schism between Economics and Sociology? By Georges El Haddad
  2. Introduction : Malaise dans la science économique ? By Akhabbar, Amanar
  3. Ecological Limits and Hierarchical Power By Fix, Blair; Bichler, Shimshon; Nitzan, Jonathan
  4. The politics of upgrading in global value chains: The case of Rwanda’s coffee sector By Pritish Behuria
  5. Human Rights, Artificial Intelligence and Heideggerian Technoskepticism: The Long (Worrisome?) View By Risse, Mathias
  6. Le destin singulier de Marx dans la science économique en France By Thierry Pouch
  7. From finance to fascism: The real effect of Germany’s 1931 banking crisis By Sebastian Doerr; Stefan Gissler; José-Luis Peydró; Hans-Joachim Voth
  8. Smart Development Banks By Eduardo Fernández-Arias; Ricardo Hausmann; Ugo Panizza

  1. By: Georges El Haddad
    Abstract: Adam Smith (1776) is the first to introduce religions into a market. Our article studies Smith’s neglected contribution to secularization theories and sociological market of religions then distinguishes it from his contribution to the economic market of religions. The objective of this article is to show that sociology and economics of religion both rely on Smith. Our issue analyzes if the markets of religions in the two disciplines evolve contradictory or complementary. Our results show an interdisciplinary dissemination of Smith’s ideas between sociology and economics of religion, a (unknown/neglected) Smithian background for sociology of religion and a demand-side market of religions in sociology. We demonstrate that there is no opposition between the two disciplines, but a methodological difference between demand and supply mechanisms. Our historical work remarks a methodological schism in the markets of religion with the introduction of Becker’s rational choice into sociology. We trace a historical tree to distinguish the demand mechanism (Marx, Durkheim, Weber and traditional sociological market) from the supply mechanism (Tocqueville, Blau and Homans, Becker, and rational choice theory in sociology and economics of religion) in the evolution of Smith’s market.
    Keywords: Adam Smith, Market of Religions, Rational Choice Theory, Secularization Theories, Economics and Sociology of Religion.
    JEL: Z12 B12 A12 P16 B41
    Date: 2019
  2. By: Akhabbar, Amanar
    Abstract: This is the introductive chapter to the book "Wassily Leontief and Economics", published in February 2019 (ENS editions). Economists produce their statements and forecasts from devices articulating abstract theories with mathematical models and statistical instruments of measurement. What is the empirical significance of these theories, models and instruments? We consider this question from the reflection of Wassily Leontief, 1973 Nobel Prize winner, on the role of mathematics and statistical analysis in economics. His perspective makes it possible to reconsider why, in economics, "the connection does not go by itself" between the theory and the observation, according to the expression of Alain Desrosières. We reconstruct Leontief’s methodology of economics as an empirical science. From there, we show how the input-output device paves the way to empirical and disaggregated macroeconomics.
    Keywords: economics; economic methodology; history of economic thought; Leontief; macroeconomics; input-output analysis
    JEL: B00 B21 B22 B23
    Date: 2019
  3. By: Fix, Blair; Bichler, Shimshon; Nitzan, Jonathan
    Abstract: Nowadays, it is commonplace to claim that the economy overuses our limited material and energy resources and that this overuse threatens both human society and the biosphere. Other than anti-science cranks, the only ones who seem to deny this claim are mainstream economists. In our view, though, this conventional condemnation of the economy is somewhat misleading. As we see it, the root of our ecological problems lies not in the ‘economy’, but in the hierarchical power structure of capitalism.
    Keywords: energy,hierarchy,power,sustainability
    JEL: P48 P16 Q01
    Date: 2019
  4. By: Pritish Behuria
    Abstract: Two parallel tracks of research on economic transformation in developing countries have operated at a distance from each other over the last two decades. A global track – global value chains/global production networks (GVC/GPNs) – has focused on the increasing interconnectedness of global trading networks and has overlooked the role of the state and the explanatory power of domestic political economy. Meanwhile, a domestic track – including literature on developmental states, industrial policy and political settlements – has tended to take a methodologically nationalist perspective to examine economic transformation in developing countries, with limited reflections on external economic and political pressures. This paper contributes to an emerging stream of literature that examines how the domestic and global scales influence how developing country governments and firms tackle the challenge of economic upgrading. By combining insights from the political settlements and GVC/GPNs literature, this paper examines the Rwandan government’s attempt at upgrading its coffee production to enter specialty coffee markets. It shows how the existing GVC/GPNs literature makes an important contribution to describing how multipolar governance influences the pathways for economic upgrading in Rwanda’s coffee sector, but that even where access is granted, benefits are captive to the demands of international buyers, and gains for some have not translated across the sector. Insights from the political settlements literature showcase how domestic politics influences who benefits from insertion to GVC/GPNs and how the unequal provision of opportunities affects political stability.
    Date: 2018
  5. By: Risse, Mathias (Harvard Kennedy School)
    Abstract: My concern is with the impact of Artificial Intelligence on human rights. I first identify two presumptions about ethics-and-AI we should make only with appropriate qualifications. These presumptions are that (a) for the time being investigating the impact of AI, especially in the human-rights domain, is a matter of investigating impact of certain tools, and that (b) the crucial danger is that some such tools--the artificially intelligent ones--might eventually become like their creators and conceivably turn against them. We turn to Heidegger's influential philosophy of technology to argue these presumptions require qualifications of a sort that should inform our discussion of AI. Next I argue that one major challenge is how human rights will prevail in an era that quite possibly is shaped by an enormous increase in economic inequality. Currently the human-rights movement is rather unprepared to deal with the resulting challenges. What is needed is greater focus on social justice/distributive justice, both domestically and globally, to make sure societies do not fall apart. I also argue that, in the long run, we must be prepared to deal with more types of moral status than we currently do and that quite plausibly some machines will have some type of moral status, which may or may not fall short of the moral status of human beings (a point also emerging from the Heidegger discussion). Machines may have to be integrated into human social and political lives.
    Date: 2019–02
  6. By: Thierry Pouch (REGARDS - Recherches en Économie Gestion AgroRessources Durabilité Santé- EA 6292 - URCA - Université de Reims Champagne-Ardenne)
    Date: 2018–04
  7. By: Sebastian Doerr; Stefan Gissler; José-Luis Peydró; Hans-Joachim Voth
    Abstract: Do financial crises radicalize voters? We analyze a canonical case – Germany during the Great Depression. After a severe banking crisis in 1931, caused by foreign shocks and political inaction, radical voting increased sharply in the following year. Democracy collapsed six months later. We collect new data on pre-crisis bank-firm connections and show that banking distress led to markedly more radical voting, both through economic and non-economic channels. Firms linked to two large banks that failed experienced a bank-driven fall in lending, which caused reductions in their wage bill and a fall in city-level incomes. This in turn increased Nazi Party support between 1930 and 1932/33, especially in cities with a history of anti-Semitism. While both failing banks had a large negative economic impact, only exposure to the bank led by a Jewish chairman strongly predicts Nazi voting. Local exposure to the banking crisis simultaneously led to a decline in Jewish-gentile marriages and is associated with more deportations and attacks on synagogues after 1933.
    Keywords: Financial crises, banking, Great Depression, democracy, anti-Semitism
    JEL: E44 G01 G21 N20 P16
    Date: 2018–03
  8. By: Eduardo Fernández-Arias; Ricardo Hausmann (Center for International Development at Harvard University); Ugo Panizza
    Abstract: The conventional paradigm about development banks is that these institutions exist to target well-identified market failures. However, market failures are not directly observable and can only be ascertained with a suitable learning process. Hence, the question is how do the policymakers know what activities should be promoted, how do they learn about the obstacles to the creation of new activities? Rather than assuming that the government has arrived at the right list of market failures and uses development banks to close some well-identified market gaps, we suggest that development banks can be in charge of identifying these market failures through their loan-screening and lending activities to guide their operations and provide critical inputs for the design of productive development policies. In fact, they can also identify government failures that stand in the way of development and call for needed public inputs. This intelligence role of development banks is similar to the role that modern theories of financial intermediation assign to banks as institutions with a comparative advantage in producing and processing information. However, while private banks focus on information on private returns, development banks would potentially produce and organize information about social returns.
    Keywords: Market Imperfections, Industrial Policy, Public Banks
    JEL: G21 G28 G14 L32 O25

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