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on Post Keynesian Economics |
| By: | Roth, Steve |
| Abstract: | This paper highlights and unpacks a little-known reality about the Financial Accounts of the United States: the Flows matrix on page 1 of the Federal Reserve’s quarterly Z.1 report does not explain period-to-period changes in the Levels matrix on page 3. The same is true of the sectoral Flow and Levels tables underlying those matrixes. Nor do those tables provide balance-sheet-complete accounting of household or national wealth accumulation. Measures of net saving/investment/capital formation and accumulation, and national wealth accumulation, diverge by tens of trillions of dollars. The discrepancy is explained and resolved by assembling a balance-sheet-complete empirical derivation of comprehensive U.S. “Haig-Simons” income, based on the Integrated Macroeconomic Accounts. The comprehensive measure is 23% higher than national accounts’ “primary” income. Relationships to the Piketty/Saez/Zucman Distributional National Accounts (DINAs) are discussed, along with implications for economic theory and empirical modeling, both mainstream and heterodox/Post-Keynesian. |
| Keywords: | wealth; flow of funds; capital; accumulation; integrated macroeconomic accounts; IMAs; income; gains; holding gains; capital gains; haig-simons |
| JEL: | B4 B5 E21 E22 E25 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:105281&r= |
| By: | Spash, Clive L. |
| Abstract: | Today, environmental economics is the response of the neoclassical economic school to the ecological crisis, but at one time its leading contributors regarded it as a revolutionary development that would change the conduct and content of economics as a discipline. Understanding and addressing environmental pollution was core to that potential paradigm shift. In tracing the history of conceptualising pollution as an externality and market failure this paper covers the development of ideas by Marshall, Pigou, Pareto, Coase, Stigler, Samuelson, Ciciacy-Wantrup and Kapp. Pollution externality theory is shown to have incorporated an elitist ethics and liberal market ideology. As a market failure pollution was deemed a minor correctible error of the price system. Monetary valuation of social and environmental harm became the means of justifying optimal levels of pollution. Neoliberal theories of spreading property rights further watered down potential interventionist aspects. Bio-physical realism, in the work of Kneese, Ayres and d’Arge, and social realism in Kapp’s theory of cost shifting were lost once environmental economics adopted a deductivist mathematical formalism. Kapp’s alternative theory is based on a classic institutionalists economic understanding of cost shifting and power relations. It advocates a public policy response in the form of objective social minima achieved via regulation and planning. This theory has until now been successfully supressed to prevent a potential revolutionary paradigm shift in economic price theory. |
| Keywords: | externalities; market failure, cost shifting; price theory; pollution; Pigou; Coase; Kapp; paradigm shift; environmental economics, neoclassical economics; institutional economics, neoliberal |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wus009:8108&r= |
| By: | Fornaro, Luca; Wolf, Martin |
| Abstract: | We study the effects of supply disruptions - for instance caused by the emergence of a pandemic - in an economy with Keynesian unemployment and endogenous productivity growth. By negatively affecting investment, even purely transitory negative supply shocks generate permanent output losses. The associated negative wealth effect depresses consumers' demand, which may even fall below the exogenous fall in supply. In this case, the optimal monetary policy response flips relative to conventional wisdom, as monetary expansions are needed to fight negative output gaps. If monetary policy is not expansionary enough a supply-demand doom loop emerges, causing a recession characterized by unemployment and weak productivity growth. Innovation policies, by fostering firms' investment, can restore full employment and healthy growth. |
| Keywords: | COVID-19; Endogenous Growth; Fiscal policy; hysteresis; investment; Keynesian growth; monetary policy; Supply Shocks; zero lower bound |
| JEL: | E22 E31 E32 E52 E62 O42 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15423&r= |
| By: | Saccal, Alessandro |
| Abstract: | The following contributions are hereby worked: one mathematically formalises Mundell’s Impossible trio and Rodrik’s Globalisation paradox, supplying the latter with a taxonomy in terms of the current account; by means of Kaldor’s price endogeneity in output, one proves that external real money market disparity and trade generate external output mismatches and lead to autarky unless offset, using topology and dynamical systems; one characterises transfers and federalism and shows that all unitary states are federal polities and can merge into confederations; one demonstrates that the said external output mismatches can be only eluded via autarky or neutralisation, irrespective of federalism; one discerns artificial currency areas guaranteeing inter-regional external output equality and modern protectionism as two Nash equilibria, especially rationalising the nexus between the Gold standard, the Industrial revolution and the Great divergence therethrough. |
| Keywords: | autarky; federalism; inefficiency; trilemma. |
| JEL: | E12 F13 F22 F41 F43 F45 F52 F60 N10 O11 O40 |
| Date: | 2019–07–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:107639&r= |
| By: | Clark, Robert; Lusardi, Annamaria; Mitchell, Olivia S |
| Abstract: | Early in the COVID-19 pandemic, much of the US economy was closed to limit the virus' spread, and several emergency interventions were implemented. Our analysis of older (45-75) respondents fielded in April-May of 2020 indicates that about one in five respondents was financially fragile and would have difficulty facing a mid-size emergency expense. Some subgroups were at particular risk of facing financial difficulties, especially younger respondents, those with larger families, Hispanics, and the low income. Moreover, the more financially literate were better able to handle such shocks, indicating that knowledge can provide some additional protection during a pandemic. |
| Keywords: | financial literacy; financial resilience; older population; vulnerable groups |
| JEL: | D14 G53 I38 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15532&r= |
| By: | Felix Windegger; Clive L. Spash |
| Abstract: | The hegemonic role of neoliberal ideas in todayÂ’s political-economic thought and practice has shaped the common way of thinking about freedom in Western society and more generally in the international community. This involves a negative, individualistic and market-centred interpretation of the concept. In contrast, visions of a degrowth society offer a radical alternative based on Cornelius CastoriadisÂ’ notion of autonomy. This paper outlines how this formulation of freedom can be conceptualised relative to the predominant neoliberal theory. We present an overview and contrast of both positions and then follow this up with an empirical study. More specifically, we probe the extent to which the degrowth movement actually follows the Castoriadian theory of freedom as opposed to the hegemonic neoliberal conception. Results are reported from a survey conducted at the 2018 Degrowth Conference in Malmö, Sweden. While survey participants were found to hold positions consistent with the Castoriadian theory, we also identify problematic and under-conceptualised aspects in their understanding of freedom. This points to the need for the degrowth movement to directly address its theoretical foundations, and elaborate on and strengthen its vision of freedom compatible with a future degrowth society. |
| Keywords: | Political economy; freedom; Degrowth; neoliberalism; autonomy; social-ecological economic transformation; Castoriadis; Hayek; Friedman |
| JEL: | A13 B5 O44 P1 P48 Q57 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwsre:sre-disc-2021_02&r= |
| By: | Boeing, Geoff (Northeastern University); Batty, Michael; Jiang, Shan; Schweitzer, Lisa |
| Abstract: | Urban analytics combines spatial analysis, statistics, computer science, and urban planning to understand and shape city futures. While it promises better policymaking insights, concerns exist around its epistemological scope and impacts on privacy, ethics, and social control. This chapter reflects on the history and trajectory of urban analytics as a scholarly and professional discipline. In particular, it considers the direction in which this field is going and whether it improves our collective and individual welfare. It first introduces early theories, models, and deductive methods from which the field originated before shifting toward induction. It then explores urban network analytics that enrich traditional representations of spatial interaction and structure. Next it discusses urban applications of spatiotemporal big data and machine learning. Finally, it argues that privacy and ethical concerns are too often ignored as ubiquitous monitoring and analytics can empower social repression. It concludes with a call for a more critical urban analytics that recognizes its epistemological limits, emphasizes human dignity, and learns from and supports marginalized communities. |
| Date: | 2021–05–14 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:bwhx2&r= |
| By: | Fisayo Fagbemi (Obafemi Awolowo University, Nigeria) |
| Abstract: | The paper appraised the emanating effect of COVID-19 on sustainable development goals (SDGs) in Nigeria through the systematic illustration of the prevailing incidents. It was affirmed that the preoccupation with the COVID-19 cases caused many other critical socioeconomic issues (like education, infrastructure development, and employment) to suffer a state of negligence or be overlooked. Like other developing countries, Nigeria could become poorer, given the increased unemployment rate and the anticipated difficulty in servicing debt resulting from the COVID-19 outbreak. Hence, festering challenges including poverty, limited access to health care, low education quality, poor road networks among others, could be further entrenched. These incidents could be detrimental to sustainable development goals (SDGs) 2030 agenda. The current crisis, therefore, poses a threat to Nigeria’s development prospects, as it may take more time to recover, especially in the post-COVID-19 era. Thus, it is critical to recognize the significance of securing strong institutional regulatory setup and resources (including financial and material resources) needed to facilitate sustainable change in the economy. |
| Keywords: | COVID-19, economic crisis, sustainable development goals (SDGs), Nigeria |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:21/026&r= |
| By: | Semenova, Valentina; Winkler, Julian |
| Abstract: | This paper develops an empirical and theoretical case for how `hype' among retail investors can drive large asset fluctuations. We use the dataset of discussions on WallStreetBets (WSB), an online investor forum with over nine million followers as of April 2021, to show how excitement about trading opportunities can ripple through an investor community with large market impacts. This paper finds empirical evidence of psychological contagion among retail investors by exploiting differences in stock price fluctuations and discussion intensity. We show that asset discussions on WSB are self-perpetuating: an initial set of investors attracts a larger and larger group of excited followers. Sentiments about future stock performance also spread from one individual to the next, net of any fundamental price movements. Leveraging these findings, we develop a model for how social contagion impacts prices. The proposed model and simulations show that social contagion has a destabilizing effect on markets. Finally, we establish a causal relationship between WSB activity and financial markets using an instrumental variable approach. |
| Keywords: | Network Economics, Opinion Dynamics, Natural Language Processing, Behavioral Finance |
| JEL: | D85 G14 |
| Date: | 2021–05–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:107575&r= |
| By: | Ho Fai Chan; David A. Savage; Benno Torgler |
| Abstract: | Sporting events can be seen as controlled, real-world, miniature laboratory environments, approaching the idea of holding other things equal when exploring the implications of decisions, incentives, and constraints in a competitive setting (Goff and To llison 1990, Torgler 2009). Thus, a growing number of studies have used sports data to study decision making questions that have guided behavioural economics literature. Creative application of sports data can offer insights into behavioural aspects with implications beyond just sports. In this chapter, we will discuss the methodological advantages of seeing sport as a behavioural econom ics lab, concentrating on the settings, concepts, biases, and challenging areas. Beyond that, we will discuss que stions that have not yet been analysed, offering ideas for future studies using sports data. We will fu rther reflect on how AI has evolved; focusing, for example, on chess, which provides insights into the mechanism and machinery of decision-making. |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:cra:wpaper:2021-20&r= |