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on Post Keynesian Economics |
| By: | Sheila Dow (Department of Economics, University of Victoria) |
| Abstract: | The uncertainty which has characterised the financial crisis has encouraged renewed attention to uncertainty in economics. Yet, not only is uncertainty seen as unpalatable in financial markets and economic life more generally, it also poses challenges for economists to the extent that uncertainty is absent from most of mainstream theory. The purpose of this paper is to consider the reasons for this in terms of attitudes to uncertainty and the coping mechanisms which society develops to deal with uncertainty. The causes, nature and consequences of uncertainty are therefore reviewed, both in the economy and among economists. This is followed by a review of mechanisms for bringing order to uncertainty. It is argued that the coping mechanism of uncertainty-denial can be counterproductive where it arises from a closed-system understanding of uncertainty as being exogenous and inevitably anathema. But an open-system understanding sees uncertainty as more integral to economic life. Further it allows for uncertainty which, as the counterpart of creativity, can be seen in some circumstances in a positive light. It is concluded that economists could profitably consider embracing uncertainty by tailoring our methodologies and theories to address uncertainty. In this way we can tailor policy to reducing uncertainty in the economy and also reduce our own uncertainty |
| Keywords: | uncertainty, open systems, financial behaviour |
| Date: | 2024–03–21 |
| URL: | http://d.repec.org/n?u=RePEc:vic:vicddp:1204&r=pke |
| By: | Peter Skott |
| Abstract: | Notions of conflict inflation have been central to neo-Marxian and post-Keynesian economics. There are tensions, however, within the Marxian/post-Keynesian camp. Post-Keynesians emphasize weak feedback effects between price and wage inflation, thereby preserving the importance of aggregate demand in the determination of output and employment in the medium and long run. Like Kalecki (1943), Marxists typically suggest, on the contrary, that if unemployment is kept low, cumulative increases in workers. power and militancy imply severe limitations of aggregate demand policy in the long run. The paper discusses these rival perspectives and their implications, suggesting that (i) valid Marxian concerns are likely to derail ambitious reform programs that rely on fiscal expansion, (ii) Kalecki’s analysis failed to recognize the centrality of inflation for aggregate demand policy and the multidimensional character of class conflict, and (iii) rather than focus on the wage struggle, labor movements may benefit from prioritizing political and institutional change. |
| Keywords: | wage aspirations, fairness norms, worker militancy, hysteresis, welfare state, de-commodifcation |
| JEL: | E31 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:pke:wpaper:pkwp2406&r=pke |
| By: | Jon D. Wisman |
| Abstract: | Ever since exploitation and extreme inequality became possible with the rise of the state, ideology serving the interests of elites has almost always persuaded non-elites that the prevailing social order is also in their best interest. This ideology was first expressed in religion that evolved to depict extremely unequal social conditions as in accord with sacred forces. Ideology provided a more efficient means of maintaining exploitation than violence. With the rise of capitalism, secular doctrines, and especially political economy and then economics, joined and eventually mostly replaced religion in justifying inequality. Since the late eighteenth century, laissez faire has been the dominant expression of this ideology. Only once, due to the extreme hardship of the Great Depression, has it been sufficiently delegitimated such that public policies were enacted that reduced inequality and significantly improved the quality of life for non-elites. However, laissez-faire ideology resurged to dominance in the 1970s, resulting in policies over the next half century that have led to exploding inequality. The fact that this ideology survived intact the Great Recession following the financial crisis of 2008 poses the question of whether it can again be adequately delegitimated. Yet there is urgency that this occurs prior to the death of democracy and thus capability of avoiding ecological Armageddon. This chapter suggests that only an adequately attractive alternative social vision to that of laissez-faire capitalism might delegitimate laissez-faire ideology. It concludes with a brief sketch of such a vision. |
| Keywords: | Ideology, exploitation, inequality, legitimation, material progress vision |
| JEL: | B15 N40 Z12 Z13 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:amu:wpaper:2024-02&r=pke |
| By: | Halkos, George; Gkargkavouzi, Anastasia |
| Abstract: | Behavioral environmental economics (BEE) is an emerging field that combines principles from behavioral and environmental economics along with psychological theory to study how human behavior influences environmental issues. It recognizes that human behavior often deviates from the rational actor model assumed in traditional environmental economics and seeks to understand the psychological, social, and emotional factors that influence people's decisions related to the environment. By gaining insights intothe human decision-making mechanism, BEE can better explain economically relevant environmental behavior and increase the predictive power of existing models. The fieldguidesthe design of effective and tailored-specific policy interventions that work with human behavioral tendencies, such as using defaults, framing, and social reinforcement to "nudge" people toward environmentally friendly choices. While behavioral insights can complement traditional policy tools, broader reforms are also needed to achieve sustainability. New trends derived from interdisciplinary research combining Environmental Psychology and Behavioral Economics are discussed. Overall, BEE offers a more realistic understanding of human decision-making and can help maximize the environmental benefits achieved through limited resources. |
| Keywords: | Behavioral environmental economics; Human decision-making; Environmentalism; Environmental policy; Sustainability. |
| JEL: | I30 Q00 Q51 Q59 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120752&r=pke |