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- Shackle (3)
- Uncertainty (3)
- Income distribution (2)
- Abor value (1)
- Axiomatic analysis; Labour Exploitation; Profit-Exploitation Cor- respondence Principle; Class-Exploitation Correspondence Principle; Labour Theory of Value (1)
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- Balance of payments (1)
- Cambridge equation (1)
- Chaos (1)
- Classical theory of prices (1)
- Comparative/historical sociology (1)
- Employment hysteresis (1)
- Endogenous money (1)
- Expectations (1)
- Expected utility theory (1)
- Fiscal and monetary policy. (1)
- Fiscal policy (1)
- Goodwin cycles (1)
- Growth cycles (1)
- Harrodian instability (1)
- Harrod’s problems (1)
- Hegemony (1)
- Inflation; Systematically significant prices; Input-output analysis; Cost-push price formation (1)
- International trade (1)
- Modern Monetary Theory (1)
- Monetary policy (1)
- Money (1)
- Neutrality of money (1)
- Non-additivity (1)
- Output-capital ratio (1)
- Panic (1)
Articles 1 - 15 of 15
Full-Text Articles in Social and Behavioral Sciences
Axiomatic Marxian Exploitation Theory: A Survey Of The Recent Literature, Rylan Chinnock, Roberto Veneziani, Naoki Yoshihara
Axiomatic Marxian Exploitation Theory: A Survey Of The Recent Literature, Rylan Chinnock, Roberto Veneziani, Naoki Yoshihara
Economics Department Working Paper Series
In this paper we review recent developments in axiomatic studies of Marxian exploitation theory. First, given the acute controversy over the formal definition of exploitation during the 1970-1990s, we review the study of the axiomatic frame- work, which identifies some fundamental properties – technically, domain conditions – that any definition of exploitation should satisfy. Moreover, we provide a survey on the axiomatic studies about the proper measures of exploitation which coherently preserve the basic Marxian perceptions represented by two axioms, Profit- Exploitation Correspondence Principle and Class-Exploitation Correspondence Principle. Finally, we examine the relevance of the labour theory of value in …
Can Price Controls Be Optimal? The Economics Of The Energy Shock In Germany, Tom Krebs, Isabella M. Weber
Can Price Controls Be Optimal? The Economics Of The Energy Shock In Germany, Tom Krebs, Isabella M. Weber
Economics Department Working Paper Series
In the wake of the global energy crisis, many European countries used energy price controls to fight inflation and to stabilize the economy. Despite its wide adoption, many economists remained skepti- cal. In this paper, we argue that price controls should be part of the policy toolbox to respond to shocks to systemically important sectors because not using them can have large economic and polit- ical costs. We put forward our arguments in two steps. In a first step, we analyze the impact on the German economy and society of the global energy crisis that followed Russia’s attack on Ukraine …
Alternative Approaches To Labor Values And Prices Of Production: Theory And Evidence, Deepankar Basu, Athanasios Moraitis
Alternative Approaches To Labor Values And Prices Of Production: Theory And Evidence, Deepankar Basu, Athanasios Moraitis
Economics Department Working Paper Series
In this paper, we discuss three approaches to estimating classical prices of production(long run equilibrium prices) in both a circulating capital model and a model that includes capital stock: the Standard Interpretation of Marx’s value theory, the New Interpretation of Marx’s value theory, and the Sraffian approach to prices of production. We add two refinements to both models: (a) allowing for differential wages rates across industries; and(b) taking account of unproductive industries in labor value calculations. We implement(a) the circulating capital models using harmonized input-output data from the World Input Output Database for 37 countries for the period 2000–2014, and …
Endogenous Business Cycles And Economic Policy, Peter Skott
Endogenous Business Cycles And Economic Policy, Peter Skott
Economics Department Working Paper Series
This paper examines the dynamics of Keynesian models that incorporate feedback effects from the labor market to income distribution, in- vestment, aggregate demand and output. A baseline version of the model can generate endogenous growth cycles, but cumulative divergence and economic collapse also become possible for plausible parameter values. Extensions of the model that include monetary and Öscal policy show greater robustness: the local instability of the stationary point leads to limit cycles (rather than complete collapse), even when large, destabilizing changes are made to parameters describing the private sector. The robustness of the general approach is reinforced by the …
Economic Growth In Dual And Mature Economies: Revisiting The Pasinetti And Neo-Pasinetti Theorems, Peter Skott
Economic Growth In Dual And Mature Economies: Revisiting The Pasinetti And Neo-Pasinetti Theorems, Peter Skott
Economics Department Working Paper Series
This paper (i) examines the role of income distribution in the determination of the average saving rate and the growth process in dual and mature economies, and (ii) revisits the Pasinetti and neo-Pasinetti theo- rems. The profit share may influence saving because of differences in the saving rates across households (the Pasinetti theorem) or because firms retain part of their earnings (the neo-Pasinetti theorem). The two mechanisms are not mutually exclusive, and the alignment between warranted and natural growth rates in mature economies can happen through feed- back e¤ects from employment to the distribution of income.
Mmt And Policy Assignment In An Open Economy Context: Simplicity Is Useful, Oversimpliflication Not So Much, Arslan Razmi
Mmt And Policy Assignment In An Open Economy Context: Simplicity Is Useful, Oversimpliflication Not So Much, Arslan Razmi
Economics Department Working Paper Series
Modern Monetary Theory (MMT) has recently received significant attention in academic and policy circles. Critics question the sustainability of MMT-prescribed approaches to fiscal and monetary policy, especially over extended periods of time, in the presence of international financial markets, and for developing country governments that borrow in foreign currency. I formalize some of these arguments using a dynamic, open economy, Tobin-Markowitz portfolio balance environment that takes into account: (1) the role of expectations in the foreign exchange market and the feedback mechanisms between these and the exchange rate and inflation, and (2) interactions between the current account, debt accumulation, and …
A Critical Reinterpretation Of Shacklean Decision Theory, Se Ho Kwak
A Critical Reinterpretation Of Shacklean Decision Theory, Se Ho Kwak
Economics Department Working Paper Series
Shackle was one of the representative critics of probability calculus. His alternative decision theory was mathematically reformalized by Katzner till 1990s. Following the Katzner’s reformalized framework, this paper presents a new interpretation of Shacklean theory by focusing on the common stage structure of the decision-making. This paper shows that the characteristics of Shackle-Katzner framework can be explained as: (1) the non-distributive and non-additive ordinal measure of subjective uncertainty, (2) the incomplete list of imaginable future states, (3) the valuation of “importance” reflecting various types of loss- psychology, and (4) the final choice of the action is made on the set …
A Functional Representation Of Potential Surprise Ordering, Se Ho Kwak
A Functional Representation Of Potential Surprise Ordering, Se Ho Kwak
Economics Department Working Paper Series
In the history of economic thought, Shackle was one of the representative critics about probability based economic theory. Specifically, he constructed his own concept of subjective uncertainty called potential surprise to replace probability. In 1980s, the potential surprise is axiomatized by Katzner as Kolmogorov-styled measure defined on the 𝜎-field over the set of possible states. In this paper, potential surprise function is reconstructed as the functional representation of potential surprise ordering on the space of hypotheses about future called monad.
Inflation In Times Of Overlapping Emergencies: Systemically Significant Prices From An Input-Output Perspective, Isabella M. Weber, Jesus Lara Jauregui, Lucas Teixeira, Luiza Nassif Pires
Inflation In Times Of Overlapping Emergencies: Systemically Significant Prices From An Input-Output Perspective, Isabella M. Weber, Jesus Lara Jauregui, Lucas Teixeira, Luiza Nassif Pires
Economics Department Working Paper Series
In the overlapping global emergencies of the pandemic, climate change and geopolitical confronta- tions, supply shocks have become frequent and inflation has returned. This raises the question how sector-specific shocks are related to overall price stability. This paper simulates price shocks in an input-output model to identify sectors which present systemic vulnerabilities for monetary stability in the US. We call these prices systemically significant. We find that in our simulations the pre-pandemic average price volatilities and the price shocks in the COVID-19 and Ukraine war inflation yield an almost identical set of systemically significant prices. The sectors with system- ically …
Systemic Cycles Of Accumulation And Chaos In The World Capitalist System: A Missing Link, Giorgos Galanis, Christian Koutny, Isabella Weber
Systemic Cycles Of Accumulation And Chaos In The World Capitalist System: A Missing Link, Giorgos Galanis, Christian Koutny, Isabella Weber
Economics Department Working Paper Series
We re-examine the Systemic Cycles of Accumulation (SCA) of Arrighi (2010) and Arrighi and Silver (1999) which provide a framework for the analysis of the cyclical patterns of geographical expansion of trade and production and the related shifts of hegemonic power within the world capitalist system. Within the SCA framework, the last stage of a hegemonic cycle is characterized by what is called ‘systemic chaos’, however the drivers of these chaotic dynamics have not been explicitly analyzed. This article fills this gap by providing a link between the accumulation process, the spatio-temporal fix, and systemic chaos, in three steps. First, …
Growth Cycles In Mature And Dual Economies, Peter Skott
Growth Cycles In Mature And Dual Economies, Peter Skott
Economics Department Working Paper Series
Mature economies may experience fluctuations, but the average medium and long run growth rate matches the natural rate. Like Kaldor's neo- Keynesian models, the Marx-Goodwin tradition explains this outcome by endogenizing the distribution of income and assuming that the accumulation of capital is increasing as a function of the profit share. The application of Goodwin cycles to developing economies may be hard to justify, however. The modified Goodwin models in this paper include relative-wage norms as a central element of wage formation. Norms change endogenously, leading to path dependence (hysteresis) in the stationary solution for the employment share of the …
World Profit Rates, 1960-2019, Deepankar Basu, Julio Huato, Jesus Lara Jauregui, Evan Wasner
World Profit Rates, 1960-2019, Deepankar Basu, Julio Huato, Jesus Lara Jauregui, Evan Wasner
Economics Department Working Paper Series
In this paper we present estimates of the world profit rate using country-level data from the Extended Penn World Table 7.0 and industry-level data from the World Input Output Database. The country-aggregated world profit rate series spans the period from 1960 to 2019, and the industry-aggregated world profit rate series runs from 2000 to 2014. The country-aggregated world profit rate series displays a strong negative linear trend for the period 1960-1980 and a weaker negative linear trend from 1980 to 2019. A medium run decomposition analysis reveals that the decline in the world profit rate is driven by a decline …
Portfolio Adjustment And Panic Behavior Under True Uncertainty, Se Ho Kwak
Portfolio Adjustment And Panic Behavior Under True Uncertainty, Se Ho Kwak
Economics Department Working Paper Series
G.L.S. Shackle was one of the representative critics against probability- based economic theory, and influenced some Post-Keynesians and Austri- ans. During the 1980s and 1990s, his alternative framework was math- ematically reconstructed by Katzner. In this paper, we will reformalize the Shackle-Katzner framework to explain the financial decision-making of the individual. For this, the portfolio diversification between two non- monetary assets will be explained by the reformalized model introduced here, and then moved to the analysis about a case of money and a non- monetary asset. Based on these findings, a few possible scenarios of panic behavior in the portfolio …
The (Im-)Possibility Of Rational Socialism: Mises In China’S Market Reform Debate, Isabella M. Weber
The (Im-)Possibility Of Rational Socialism: Mises In China’S Market Reform Debate, Isabella M. Weber
Economics Department Working Paper Series
This paper investigates the long first decade of reform in China (1978-1992) to show that Mises, in particular his initiating contribution to the Socialist Calculation Debate, became relevant to the reconfiguration of China’s political economy when the reformers gave up on the late Maoist primacy of continuous revolution and adhered instead to an imperative of development and catching up. During the Cultural Revolution, Mao had rejected the notions of efficiency and rational economic management. In the late 1970s, the reformers under Deng Xiaoping’s leadership elevated these notions to highest principle. As a result, Mises’ critique that socialism could not achieve …
The Nature Of Money And The Theory Of International Trade: Thornton And Ricardo, Isabella M. Weber
The Nature Of Money And The Theory Of International Trade: Thornton And Ricardo, Isabella M. Weber
Economics Department Working Paper Series
A rich recent literature reinvestigates the nature of money, but little attention has been paid to the ramifications of the ways in which we theorize money for the theory of international trade. This paper examines the logical relationship between the neutrality of money and self-balancing trade based on Henry Thornton and David Ricardo as two foundational contributions to credit and commodity money theories respectively. I show that both authors theorize trade as self-balancing whenever money is conceptualized as neutral. I distinguish two notions of the neutrality of money: ex ante and ex post neutrality. In Thornton’s Paper Credit money is …