nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2021‒02‒15
six papers chosen by
Karl Petrick
Western New England University

  1. Financialization's conservation and transformation: from Mark I to Mark II By Tristan Auvray; Cédric Durand; Joel Rabinovich; Cecilia Rikap
  2. The Conservative Legacy of Neoliberalism By Martin Beddeleem; Nathanael Colin-Jaeger
  3. Marxisme et théorie néoclassique. La reconstruction incertaine de John Roemer By Fabien Tarrit
  4. The Future of the City after COVID-19: Digitionalization, Preventism and Environmentalism By Julia M. Puaschunder
  5. The long shadow of slavery: the persistence of slave owners in Southern law-making By Luna Bellani; Anselm Hager; Stephan E. Maurer
  6. From Homo Oeconomicus to Homo Praeventicus By Julia M. Puaschunder

  1. By: Tristan Auvray (CEPN - Centre d'Economie de l'Université Paris Nord - UP13 - Université Paris 13 - USPC - Université Sorbonne Paris Cité - CNRS - Centre National de la Recherche Scientifique); Cédric Durand; Joel Rabinovich; Cecilia Rikap
    Abstract: This paper argues that, as far as the investment behavior of non-financial corporations is concerned, the apparent continuity over the last four decades suggested by the financialization label is misleading. Indeed, while the disconnection between profitability and investment is a robust stylized fact for most of the period, with cumulative detrimental consequences for labor, we contend that the underlying mechanisms changed meaningfully at the turn of the millennium. This contribution proposes to establish-empirically and theoretically-two distinctive successive financialization regimes (Mark I and Mark II) and to explain their evolutionary articulation. Financialization Mark I is characterized by the empowerment of financial actors: in a context of high-interest rates and full-blown liberalization, diminishing retained earnings by non-financial corporations resulted in a dramatic slowdown of investment with cascading negative effects for labor. Contrastingly, Financialization Mark II is characterized by a strongly established financial hegemony with new forms of intellectual and financial monopoly. In this configuration, interest rates are low and global value chains are deeply seated. This fuels rampant deflationary pressure, which changes the overall dynamic of the profit-investment nexus. Then, in Financialization Mark II, contrary to what occurred during Financialization Mark I, distributed profits are the consequence of slow investment.
    Keywords: Financialization regimes,Investment-profit nexus,Payout,Globalization,Intellectual monopoly,Asset managers
    Date: 2020–12–17
  2. By: Martin Beddeleem (Aarhus University [Aarhus]); Nathanael Colin-Jaeger (TRIANGLE - Triangle : action, discours, pensée politique et économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UJM - Université Jean Monnet [Saint-Étienne] - IEP Lyon - Sciences Po Lyon - Institut d'études politiques de Lyon - Université de Lyon - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The 1930s and 1940s marked a period of crisis for liberalism. Authors as diverse as Hayek, Röpke, Lippmann, Polanyi and Rougier came together at two founding events, the Walter Lippmann Colloquium in 1938 and the creation of the Mont-Pèlerin Society in 1947, to rethink liberalism. This rethinking of the liberal project led them to establish a diagnosis of the crisis of liberalism, which, for the authors mentioned, goes back to the French Revolution. This article proposes to show the coherence of the neoliberal project from their historical diagnosis in this period of crisis. Indeed, by criticizing the French Revolution and its effects as part of a harmful rationalism, which gave rise to both laissez-faire and various collectivisms, neoliberals explicitly take up concepts from critics of the revolution, especially Edmund Burke. The concept of tradition, understood as covering social and legal rules that have slowly evolved to constitute coordination mechanisms that allow our actions, is thus very largely taken up and valued by neoliberals. We thus interpret neoliberal theory on the basis of this recategorization of the concept of tradition, and point out the affinities of neoliberal positions with philosophical conservatism. This rapprochement reveals several conceptual tensions between cultural evolutionism on the one hand and the defence of substantial Western values on the other.
    Abstract: Les années 1930 et 1940 marquent une période de crise pour le libéralisme. Des auteurs aussi divers que Hayek, Röpke, Lippmann ou encore Polanyi et Rougier se réunissent, lors de deux événements fondateurs, le Colloque Walter Lippmann en 1938 et la création de la Société du Mont Pèlerin en 1947, pour repenser le libéralisme. Cette refonte du projet libéral les pousse à établir un diagnostic relatif à la crise du libéralisme, remontant, pour les auteurs mentionnés, à la Révolution Française. Cet article se propose de montrer la cohérence du projet néolibéral à partir de leur diagnostic historique dans cette période de crise. En effet en critiquant la Révolution Française et ses effets comme participant d'un rationalisme néfaste, ayant donné naissance aussi bien au laissez-faire qu'aux divers collectivismes, les néolibéraux reprennent explicitement des concepts des critiques de la révolution, au premier rang desquels Edmund Burke. Le concept de tradition, compris comme recouvrant des règles sociales et juridiques ayant lentement évoluées de façon à constituer des dispositifs de coordination permettant nos actions, est ainsi très largement repris et valorisé par les néolibéraux. Nous interprétons ainsi la théorie néolibérale à partir de cette recatégorisation du concept de tradition, et pointons les affinités des positions néolibérales avec le conservatisme philosophique. Ce rapprochement fait apparaître plusieurs tensions conceptuelles entre d'une part un évolutionnisme culturel et d'autre part la défense de valeurs occidentales substantielles.
    Keywords: Néoliberalisme,Conservatisme,tradition,Hayek,Röpke
    Date: 2021–01
  3. By: Fabien Tarrit (REGARDS - Recherches en Économie Gestion AgroRessources Durabilité Santé- EA 6292 - URCA - Université de Reims Champagne-Ardenne - MSH-URCA - Maison des Sciences Humaines de Champagne-Ardenne - URCA - Université de Reims Champagne-Ardenne)
    Abstract: Can Marx's economic thought be reconstructed from neoclassical economics? This is the question John Roemer tried to answer. He was a major actor of Analytical Marxism – especially of Rational Choice Marxism –, mainly during the 1980s. The founding objective of this school of thought has been to reach conclusions that are close to Marx's in using different methodological tools. Roemer's research program is based on the neoclassical theory. We shall discuss the consistency and the relevance of this approach through a critical examination. We wonder either what is questioned is Marx's theory or the possibility to associate it to the tools of the neoclassical theory.
    Abstract: Peut-on reconstruire sans la trahir la pensée économique de Marx à partir de la théorie néoclassique ? C'est la question à laquelle a tenté de répondre John Roemer. Il fut l'un des principaux contributeurs du marxisme analytique-plus précisément du marxisme de choix rationnel-, principalement au cours des années 1980. L'objectif fondateur de ce courant a été de parvenir à des conclusions proches de celles de Marx en utilisant des outils méthodologiques différents. Le programme de recherche de Roemer se fonde sur la théorie néoclassique. Nous discutons, d'un point de vue critique, la cohérence et la pertinence de cette approche. Nous nous demandons si ce qui est remis en cause est la théorie de Marx ou la possibilité de l'associer aux outils de la théorie néoclassique.
    Keywords: labour value,historical materialism,Marx,valeur-travail,profit,exploitation,matérialisme historique
    Date: 2020–12–01
  4. By: Julia M. Puaschunder (The New School,Department of Economics,USA)
    Abstract: Ever since, metropolitan areas have seen a resurgence of the city as a hub for exchange of ideas, social transformation and innovation. Since the ages of industrialization and globalization, cities flourished in terms of economic growth and societal advancement. The 2020 COVID-19 crisis may set an end to this. Some of the major cities and foremost Western world metropolis began to empty out with the rapid rise of an infected city population due to social transfer of the pandemic and worsened diseases outcomes in a constraint medical system in high density areas. Even if the COVID-19 will be defeated with a vaccine or overcome with herd immunity during the coming years, the economy of large cities may be permanently changed given an ongoing digitalization trends, preventive medical care attention and environmental concerns in the wake of climate change. This paper envisions these three new trends of globalization shifting cityscaping to digitalization, focus on preventive medical care and environmental conscientiousness in future cities.
    Keywords: cities, Coronavirus, COVID-19, digitalization, economic growth theory, healthcare, human capital, inequality, innovation, international development
    Date: 2020–09
  5. By: Luna Bellani; Anselm Hager; Stephan E. Maurer
    Abstract: This paper documents the persistence of the Southern slave owning elite in political power after the end of the American Civil War. We draw on a database of Texan state legislators between 1860 and 1900 and link them to their or their ancestors' slaveholdings in 1860. We then show that former slave owners made up more than half of nearly each legislature's members until the late 1890s. Legislators with slave owning backgrounds differ systematically from those without, being more likely to represent the Democratic party and more likely to work in an agricultural occupation. Regional characteristics matter for this persistence, as counties with higher soil suitability for growing cotton on average elect more former slave owners.
    Keywords: Wealth inequality, elites and development, US south, intergenerational persistence, slavery
    JEL: D72 J62 N31 H4
    Date: 2020–08
  6. By: Julia M. Puaschunder (The New School, Parsons School of Design, USA)
    Abstract: Standard economic models primarily captured human beings to be rational utility maximizers in the homo oeconomicus model. Behavioral economics addressed human decision making fallibility in a wide range of studies including laboratory and field experiments as well as big data. The currently ongoing COVID-19 crisis now underlines the importance of a healthy work environment. The medicine of the future is believed to prevent diseases instead of just treating their consequences. There is an expected shift from modern medicine’s focus on acute treatment to address the inherently-underlying preventive measures that diseases would have a more favorable trajectory or are even avoidable at all. The homo praeventicus model may focus on preventing diseases and working in advance on favorable immune conditions that avert negative outbreaks of pandemics or determine a healthier state when falling sick. The homo oeconomicus offers as a remedy to chronic diseases and a reduction of a global cost escalation for medical care. Because we have to live with environmental burdens on our health, a change of direction towards prevention is recommended and the implementation of homo praeventicus models envisioned.
    Keywords: AI, Artificial Intelligence, Coronavirus, COVID-19, Discounting, Healthcare, Homo oeconomicus, Homo praeventicus, Medical care, Precautionary principle, Prevention, Trajectory
    Date: 2020–10

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