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Marquette University

Economics Working Papers

2016

Articles 1 - 6 of 6

Full-Text Articles in Social and Behavioral Sciences

(Wp 2016-05) Hodgson, Cumulative Causation, And Reflexive Economic Agents, John B. Davis Aug 2016

(Wp 2016-05) Hodgson, Cumulative Causation, And Reflexive Economic Agents, John B. Davis

Economics Working Papers

This paper examines Geoff Hodgson’s interpretation of Veblen in agency-structure terms, and argues it produces a conception of reflexive economic agents. It then sets out an account of cumulative causation processes using this reflexive agent conception, modeling them as a two-part causal process, one part involving a linear causal relation and one part involving a circular causal relation. The paper compares the reflexive agent conception to the standard expected utility conception of economic agents, and argues that on a cumulative causation view of the world the completeness assumption essential to the standard view of rationality cannot be applied. The final …

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(Wp 2016-06) The Effectiveness Of Central Bank Forward Guidance Under Inflation And Price-Level Targeting, Stephen J. Cole Aug 2016

(Wp 2016-06) The Effectiveness Of Central Bank Forward Guidance Under Inflation And Price-Level Targeting, Stephen J. Cole

Economics Working Papers

This paper examines the effectiveness of central bank forward guidance under inflation and price-level targeting monetary policies. The results show that the attenuation of the effects of forward guidance can be solved if a central bank switches from inflation targeting to price-level targeting. Output and inflation respond more favorably to forward guidance with price-level targeting than inflation targeting. A monetary policy rule that aggressively reacts to inflation and includes interest rate inertia narrows the performance gap between the two policy regimes. However, forward guidance with price-level targeting is still preferred to forward guidance with inflation targeting after performing multiple robustness …

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(Wp 2016-04) Shock, But No Shift: Hospitals' Responses To Changes In Patient Insurance Mix, Kathryn L. Wagner Jun 2016

(Wp 2016-04) Shock, But No Shift: Hospitals' Responses To Changes In Patient Insurance Mix, Kathryn L. Wagner

Economics Working Papers

Medicaid reimburses healthcare providers for services at a lower rate than any other type of insurance coverage. To account for the burden of treating Medicaid patients, providers claim that they must cost-shift by raising the rates of individuals covered by private insurance. Previous investigations of cost-shifting has produced mixed results. In this paper, I exploit a disabled Medicaid expansion where crowd-out was complete to investigate cost-shifting. I find that hospitals reduce the charge rates of the privately insured. Given that Medicaid is expanding in several states under the Affordable Care Act, these results may alleviate cost-shifting concerns of the reform.

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(Wp 2016-03) Economics, Neuroeconomics, And The Problem Of Identity, John B. Davis Apr 2016

(Wp 2016-03) Economics, Neuroeconomics, And The Problem Of Identity, John B. Davis

Economics Working Papers

This paper reviews the debate in economics over neuroeconomics’ contribution to economics. It distinguishes majority and minority views, argues that this debate has been framed by mainstream economics’ conception of itself as an isolated science, and argues that this framing has put off the agenda in economics issues such as individual identity that are increasingly important in connection with the social and historical context of economic explanations in a changing complex world. The paper first discusses how the debate over neuroeconomics has been limited to the question of what information from other sciences might be employed in economics. It then …

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(Wp 2016-02) The Limits Of Central Bank Forward Guidance Under Learning, Stephen J. Cole Mar 2016

(Wp 2016-02) The Limits Of Central Bank Forward Guidance Under Learning, Stephen J. Cole

Economics Working Papers

Central bank forward guidance emerged as a pertinent tool for monetary policymakers since the Great Recession. Nevertheless, the effects of forward guidance remain unclear. This paper investigates the effectiveness of forward guidance while relaxing two standard macroeconomic assumptions: rational expectations and frictionless financial markets. Agents forecast future macroeconomic variables via either the rational expectations hypothesis or a more plausible theory of expectations formation called adaptive learning. A standard Dynamic Stochastic General Equilibrium (DSGE) model is extended to include the financial accelerator mechanism. The results show that the addition of financial frictions amplifies the differences between rational expectations and adaptive learning …

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(Wp 2016-01) Transformation Without Paternalism, John B. Davis, Tom Wells Jan 2016

(Wp 2016-01) Transformation Without Paternalism, John B. Davis, Tom Wells

Economics Working Papers

Human development is meant to be transformational in that it aims to improve people’s lives by enhancing their capabilities. But who does it target: people as they are or the people they will become? This paper argues that the human development approach relies on an understanding of personal identity as dynamic rather than as static collections of preferences, and that this distinguishes human development from conventional approaches to development. Nevertheless this dynamic understanding of personal identity is presently poorly conceptualized and this has implications for development practice. We identify a danger of paternalism and propose institutionalizing two procedural principles as …

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