nep-pke New Economics Papers
on Post Keynesian Economics
Issue of 2021‒10‒11
five papers chosen by
Karl Petrick
Western New England University

  1. How Short is the Short Run in the Neo-Kaleckian Growth Model? By Ettore Gallo
  2. Deepening and Widening Social Identity Analysis in Economics By Davis, John B.
  3. Computational Methods and Classical-Marxian Economics By Jonathan Cogliano; Roberto Veneziani; Naoki Yoshihara
  4. On the Labor Theory of Value as the Basis for the Analysis of Economic Inequality in the Capitalist Economy By Naoki Yoshihara
  5. The Future of  Heterodox  Economics By Teresa Ghilarducci; Zachary Knauss; Richard McGahey; William Milberg; Drew Landes; Edward Nilaj

  1. By: Ettore Gallo (Department of Economics, New School for Social Research)
    Abstract: The paper provides an analytical solution to the differential equation that regulates the motion of the neo-Kaleckian model in the short run. After presenting a simple open economy neo-Kaleckian model with government activity, the paper analytically derives an expression for the time of adjustment, defined as the time required for the system to make a k-percent adjustment from one steady-state to another. The solution shows that there is an inverse relationship between the strength of the Keynesian stability condition and the the time of adjustment. Last, the model is calibrated for the US, showing that vicinity of the new equilibrium is reached after a period of about 4 quarters. By formally analyzing the out-of-equilibrium trajectory of the neo-Kaleckian model, this contribution moves away from the method of comparative dynamics and provides a historical-time representation of the model's traverse.
    Keywords: Neo-Kaleckian Model, time, adjustment period, traverse, effective demand, growth, distribution
    Date: 2021–10
  2. By: Davis, John B. (Department of Economics Marquette University)
    Abstract: Abstract: This paper is a contribution to the Erasmus Journal of Economics and Philosophy symposium on Dasgupta and Goyal’s “Narrow Identities†(2019) that models how individuals develop social identities. They do not distinguish categorical and relational social identities, model only social group social identities, minimize intersectionality (having multiple social group identities), and ignore inter-relational, social role social identities. In a club theory-like analysis, they portray the world as locked into polarized social group rivalries, where democracy matters little compared to social group loyalty. A problem with explaining social identity only in terms of social group identity is that the ‘identify with’ basis of social group loyalty undermines saying people are distinct individuals. Dasgupta and Goyal use the standard circular preferences conception of what makes people distinct individuals, so they cannot say individuals do not disappear into social groups. However, a relational social roles-based social identity analysis offers a way of explaining how people can be distinct individuals and have social identities, particularly where social group identities are connected to social role identities. This analysis is outlined using a distinction between relatively closed and relatively open behavioral domains.
    Keywords: social identity, social groups, social roles
    JEL: B41 B50
    Date: 2021–09
  3. By: Jonathan Cogliano (University of Massachusetts Boston); Roberto Veneziani (Queen Mary University of London); Naoki Yoshihara (School of Economics and Management, Kochi University of Technology)
    Abstract: This article surveys computational approaches to classical-Marxian economics. These approaches include a range of techniques { such as numerical simulations, agent-based models, and Monte Carlo methods { and cover many areas within the classical-Marxian tradition. We focus on three major themes in classical-Marxian economics, namely price and value theory; inequality, exploitation, and classes; and technical change, profi tability, growth and cycles. We show that computational methods are particularly well-suited to capture certain key elements of the vision of the classical-Marxian approach and can be fruitfully used to make signi ficant progress in the study of classical-Marxian topics.
    Keywords: Computational Methods, Agent-Based Models, Classical Economists, Marx
    JEL: C63 B51 B41
    Date: 2021–09
  4. By: Naoki Yoshihara (School of Economics and Management, Kochi University of Technology)
    Abstract: In this paper, we have reviewed the labor theory of value as the basis for the analysis of economic inequality in the capitalist economy. According to the standard Marxian view, the system of labor values of individual commodities can serve as the center of gravity for long-term price fluctuations in the precapitalist economy with simple commodity-production, where no exploitative social relation emerges, while in the modern capitalist economy, the labor value system is replaced by the prices of production associated with an equal positive rate of profits as the center of gravity, in which exploitative relation between the capitalist and the working classes is a generic and persistent feature of economic inequality. Some of the literature such as Morishima (1973, 1974) criticized this view by showing that the labor values of individual commodities are no longer well-defined if the capitalist economy has joint production. Given these arguments, this paper firstly shows that the system of individual labor values can be still well-defined in the capitalist economy with joint production whenever the set of available production techniques is all-productive. Secondly, this paper shows that it is generally impossible to verify that the labor-value pricing serves as the center of gravity for price fluctuations in precapitalist economies characterized by the full development of simple commodity-production.
    Keywords: UE-Exploitation, The Labor Theory of Value, Prices of Production
    JEL: D63 D51
    Date: 2021–09
  5. By: Teresa Ghilarducci; Zachary Knauss; Richard McGahey; William Milberg; Drew Landes; Edward Nilaj (Schwartz Center for Economic Policy Analysis (SCEPA))
    Abstract: We assess economics research and teaching frameworks in the United States by examining how knowledge is produced and ranked, the flaws and strengths of heterodox economic theory; and how students are trained, especially for careers in economic policy. We challenge the meaning of established terminology such as ‘heterodoxy’ and ‘mainstream’ by investigating their utility as a marker and to illuminate major barriers to the successful adoption of alternative economic theories in academia and the public discourse. Based on interviews with experienced economists working with heterodox paradigms in both mainstream and heterodox institutions, we identify three barriers 1) Neoclassical hegemony, 2) Weakness of heterodox theory, and 3) Pedagogy and training in economics.
    Keywords: Heterodox economics; pedagogy and training; cross discipline synthesis
    JEL: H55 J26 J32
    Date: 2021–03

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