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on History and Philosophy of Economics |
| By: | Giocoli, Nicola |
| Abstract: | Most late 19th-century US economists gave a rather cool welcome to the Sherman Act (1890) and, though less harshly, to the Clayton and FTC Acts (1914). A large literature has identified several explanations for this surprising attitude, calling into play the relation between big business and competition, a non-neoclassical notion of competition and a weak understanding of anti-competitive practices. Much less investigated is the reaction of British economists to the passing of antitrust statutes in the U.S. What we know is simply that none of them (including the top dog, Alfred Marshall) championed the adoption of a law-based competition policy during the three decades (1890-1920) of most intense antitrust debates in the U.S. The position of three prominent British economists will be examined in this paper: H.S. Foxwell, D.H. MacGregor, and, of course, Alfred Marshall – the latter in two moments at the extremes of our period, 1890 and 1919. It will turn out that they all shared with their American colleagues a theoretical and operational skepticism about the government and judiciary interference with the free working of markets. They also believed that British industrial structure and business habits were so different from those in the U.S. that the urge of interfering with markets in order to preserve competition was much weaker. Among the paper's insights is that Marshall’s key concept of “defending a competitor’s right to compete” foreran the modern characterization of the goal of competition policy as "the protection of the competitive process". Yet Marshall developed his concept without making recourse to the post-1930s neoclassical notion of competition as a static market structure which lies at the foundation of most contemporary antitrust policy: a useful lesson from the history of economic thought for those IO economists who still claim that the classical dynamic view of competition is unsuited as a foundation for an effective competition policy. |
| Keywords: | British economists; antitrust law; Sherman Act; Alfred Marshall |
| JEL: | B21 B31 K21 L40 |
| Date: | 2012–05–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39245&r=hpe |
| By: | Drakopoulos, Stavros A.; Katselidis, Ioannis |
| Abstract: | The pre-war approaches to trade unions were mainly based on the theoretical and methodological viewpoints of early institutional economics. Trade unions were conceived of as politico-economic organizations whose members were motivated by relative comparisons and also were concerned with issues of equity and justice. In the post-war period, there was a major theoretical and methodological shift towards the idea of unions as optimizing economic units with well-defined objective functions which are optimized subject to purely economic constraints. This conceptual transformation took place mainly through the Dunlop-Ross debate, in which John Dunlop conceived unions as analogous to business firms, which was contrary to Arthur Ross’ institutional and political approach. The emerging post war mainstream methodological framework with its mathematical formalism and the exclusion of sociological, political and psychological elements from economic analysis was the main reason for the prevalence of Dunlop’s ideas. However, after decades of analytical developments, the current state of trade union theory has not produced very impressive theoretical results.The paper traces the historical development of the economic analysis of the trade unions from a methodological perspective. It examines the methodological reasons for the dominance of Dunlop’s approach and also the current state of, and the contemporary criticism towards, the established theory. Furthermore, it discusses the contemporary efforts to build a more comprehensive approach to trade union theory and to trade union objectives, also incorporating Ross’ institutional and political insights. |
| Keywords: | Trade Union Theory; Economic Methodology |
| JEL: | B0 J50 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39239&r=hpe |
| By: | Fernando Guirao; Frances M. B. Lynch |
| Abstract: | Alan S. Milward was an economic historian who developed an implicit theory of historical change. His interpretation which was neither liberal nor Marxist posited that social, political, and economic change, for it to be sustainable, had to be a gradual process rather than one resulting from a sudden, cataclysmic revolutionary event occurring in one sector of the economy or society. Benign change depended much less on natural resource endowment or technological developments than on the ability of state institutions to respond to changing political demands from within each society. State bureaucracies were fundamental to formulating those political demands and advising politicians of ways to meet them. Since each society was different there was no single model of development to be adopted or which could be imposed successfully by one nation-state on others, either through force or through foreign aid programs. Nor could development be promoted simply by copying the model of a more successful economy. Each nation-state had to find its own response to the political demands arising from within its society. Integration occurred when a number of nation– states shared similar political objectives which they could not meet individually but could meet collectively. It was not simply the result of their increasing interdependence. It was how and whether nation-states responded to these domestic demands which determined the nature of historical change. |
| Keywords: | historical change,development,World Wars,Third Reich,Blitzkrieg,New Order,Vichy,Fascism,Grossraumwirtschaft,German question,reconstruction,golden age,integration,supranationality,Bretton Woods |
| JEL: | B23 B31 F02 F13 N01 N14 O10 O24 P16 Q18 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1290&r=hpe |
| By: | Deutschmann, Christoph |
| Abstract: | Following the debate on the relationship between capitalism and religion, this paper discusses the role of religion in present-day capitalism. It argues that neither the secularization thesis nor the influential concepts of a 'return' or a 'transformation' of religions can offer a convincing interpretation of the challenges religions are faced with in modern capitalism. Partially following Habermas, the paper outlines an interactionist reinterpretation of Durkheim's theory of religion. It shows that from the viewpoint of such an interpretation, it is possible that the place of religion in modern societies can be filled not only by manifestly religious systems of meaning, but also by nominally nonreligious ones. I argue that the capital form of money can, in fact, assume the function of such a 'latent' religion in an apparently 'secularized' world. Nevertheless, to simply equate capitalism with religion, as many authors have suggested, would be shortsighted. Rather, as a characterization of the contemporary relationship between capitalism and religion, Paul Tillich's concept of the 'demonic' appears more promising. -- Anknüpfend an die Debatte über das Verhältnis von Kapitalismus und Religion bemüht sich der Beitrag um eine Klärung der Rolle der Religionen im gegenwärtigen Kapitalismus. Weder die in der Soziologie entwickelten Theorien der Säkularisierung und Modernisierung noch die gegenwärtig einflussreichen Thesen einer religiösen 'Wende' oder 'Transformation' können den Herausforderungen, mit denen die Religionen im gegenwärtigen Kapitalismus konfrontiert sind, wirklich gerecht werden. Der Beitrag skizziert, teilweise an Habermas anknüpfend, eine interaktionstheoretische Reformulierung von Durkheims Religionstheorie. Aus dieser Reformulierung ergibt sich die These, dass der Platz der Religion in modernen Gesellschaften auch durch nominell nicht religiöse Sinnsysteme eingenommen werden kann. Die Kapitalform des Geldes kann, wie dann gezeigt wird, die Funktion einer solchen 'latenten' Religion in einer vermeintlich 'säkularisierten' Welt einnehmen. Es wäre gleichwohl verkürzt, Kapitalismus und Religion einfach gleichzusetzen, wie eine Reihe Autoren es vorgeschlagen haben. Vielmehr bietet Paul Tillichs Theorie des 'Dämonischen' eine überzeugendere Konzeptualisierung des gegenwärtigen Verhältnisses von Kapitalismus und Religion. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:mpifgd:122&r=hpe |
| By: | Musolino, Francesco; Carfì, David |
| Abstract: | The aim of this paper is to propose a methodology to stabilize the currency markets by adopting Game Theory. Our idea is to save the Euro from the speculative attacks (due the crisis of the Euro-area States), and this goal is reached by the introduction, by the normative authority, of a financial transactions tax. Specifically, we focus on two economic operators: a real economic subject (as for example the Ferrari S.p.A., our first player), and a financial institute of investment (the Unicredit Bank, our second player). The unique solution which allows both players to win something, and therefore the only one collectively desirable, is represented by an agreement between the two subjects. So the Ferrari artificially causes an inconsistency between currency spot and futures markets, and the Unicredit takes the opportunity to win the maximum possible collective sum, which later will be divided with the Ferrari by contract. |
| Keywords: | Currency Markets; Financial Risk; Financial Crisis; Game Theory; Speculation |
| JEL: | G1 D53 C7 E44 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39240&r=hpe |
| By: | Meier, Martin (IHS Vienna); Schipper, Burkhard C. (University of CA, Davis) |
| Abstract: | Applying unawareness belief structures introduced in Heifetz, Meier, and Schipper (2012), we develop Bayesian games with unawareness, define equilibrium, and prove existence. We show how equilibria are extended naturally from lower to higher awareness levels and restricted from higher to lower awareness levels. We apply Bayesian games with unawareness to investigate the robustness of equilibria to uncertainty about opponents' awareness of actions. We show that a Nash equilibrium of a strategic game is robust to unawareness of actions if and only if it is not weakly dominated. Finally, we discuss the relationship between standard Bayesian games and Bayesian games with unawareness. |
| JEL: | C70 C72 D80 D82 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:ucdeco:2012-09&r=hpe |
| By: | Luc Anselin (GeoDa Center for Geospatial Analysis and Computation; Arizona State University) |
| Abstract: | This essay assesses the evolution of the way in which spatial data analytical methods have been incorporated into software tools over the past two decades. It is part retrospective and prospective, going beyond a historical review to outline some ideas about important factors that drove the software development, such as methodological advances, the open source movement and the advent of the internet and cyberinfrastructure. The review highlights activities carried out by the author and his collaborators and uses SpaceStat, GeoDa, PySAL and recent spatial analytical web services developed at the ASU GeoDa Center as illustrative examples. It outlines a vision for a spatial econometrics workbench as an example of the incorporation of spatial analytical functionality in a cyberGIS. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:asg:wpaper:1047&r=hpe |
| By: | Signorino, Rodolfo |
| Abstract: | I start from Nicola Giocoli’s acute rational reconstruction of current US antitrust debate which shows that there really is no shortage of plausible explanations to the Chicago persistent appeal puzzle. Each explanation, taken in isolation, is, at best, only partial. In my view, the persistent appeal of Chicago antitrust owes much to the enduring grip of the equilibrium end-state notion of competition within top US Economics Departments and to the (alleged) resilience of market competition, absent entry/exit barriers, in the face of Type II Errors committed by antitrust Agencies. |
| Keywords: | Chicago school of law and economics; Type I and Type II Errors; entry barriers and horizontal merger regulation |
| JEL: | D40 L4 |
| Date: | 2012–06–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39211&r=hpe |
| By: | Yehuda (John) Levy |
| Abstract: | We present an example of a discounted stochastic game with a continuum of states, finitely many players and actions, and deterministic transitions, that possesses no measurable stationary equilibria, or even stationary approximate equilibria. The example is robust to perturbations of the payoffs, the transitions, and the discount factor, and hence gives a strong nonexistence result for stationary equilibria. The example is a game of perfect information, and hence it also does not possess stationary extensive-form correlated equilibrium. Markovian equilibria are also shown not to exist in appropriate perturbations of our example. |
| Keywords: | Stochastic Game, Discounting, Stationary Equilibrium |
| Date: | 2012–01–11 |
| URL: | http://d.repec.org/n?u=RePEc:huj:dispap:dp596r&r=hpe |
| By: | Marc Fleurbaey (Economic Theory Center - Princeton University, Le Collège d'études mondiales/FMSH - Fondation Maison des sciences de l?homme) |
| Abstract: | This paper proposes four concepts of exploitation that encapsulate common uses of the word in social interactions: unfair advantage, unequal exchange, using persons as means, free-riding. It briefly discusses how these concepts appear in the literature (the first two are prominent in Roemer's classical work), and then examines how these forms of exploitation are related and how they can occur. |
| Keywords: | exploitation; unequal exchange; Roemer |
| Date: | 2012–02–15 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00702100&r=hpe |
| By: | Irina Cojuharenco; Gert Cornelissen; Natalia Karelaia |
| Abstract: | We suggest that cultivating an individual's connectedness to others promotes socially responsible behavior both directly and indirectly – through increased perceived ability to make a difference. Individuals whose interdependent self is more prominent feel they have more of an impact on larger scale societal outcomes and, therefore, engage more in socially responsible behaviors than do individuals whose independent self is more prominent. We test these hypotheses in two experiments in which participants make financial contributions or exert an effort for a social cause. In a survey, we find that perceived effectiveness mediates the effect of self-construal on socially responsible consumption. |
| Keywords: | self-construal, interdependent self, independent self, socially responsible behavior, perceived effectiveness |
| JEL: | C91 D64 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1292&r=hpe |
| By: | Peter Biro (Institute of Economics - Hungarian Academy of Sciences); Walter Kern (Faculty of Electrical Engineering, Mathematics and Computer Science, University of Twente, P.O.Box 217, NL-7500 AE Enschede); Daniel Paulusma (Department of Computer Science, University of Durham Science Laboratories, South Road, Durham DH1 3EY, England) |
| Abstract: | A matching game is a cooperative game (N; v) defined on a graph G = (N;E) with an edge weighting w : E ! R+. The player set is N and the value of a coalition S N is dened as the maximum weight of a matching in the subgraph induced by S. First we present an O(nm+n2 log n) algorithm that tests if the core of a matching game defined on a weighted graph with n vertices and m edges is nonempty and that computes a core member if the core is nonempty. This algorithm improves previous work based on the ellipsoid method and can also be used to compute stable solutions for instances of the stable roommates problem with payments. Second we show that the nucleolus of an n-player matching game with a nonempty core can be computed in O(n4) time. This generalizes the corresponding result of Solymosi and Raghavan for assignment games. Third we prove that is NP-hard to determine an imputation with minimum number of blocking pairs, even for matching games with unit edge weights, whereas the problem of determining an imputation with minimum total blocking value is shown to be polynomial-time solvable for general matching games. |
| Keywords: | matching game; nucleolus; cooperative game theory |
| JEL: | C61 C63 C71 C78 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:has:discpr:1142&r=hpe |
| By: | Aldo Rustichini (Department of Economics, University of Minnesota - University of Minnesota); Marie-Claire Villeval (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure - Lyon) |
| Abstract: | We show with a laboratory experiment that individuals adjust their moral principles to the situation and to their actions, just as much as they adjust their actions to their principles. We first elicit the individuals' principles regarding the fairness and unfairness of allocations in three different scenarios (a Dictator game, an Ultimatum game, and a Trust game). One week later, the same individuals are invited to play those same games with monetary compensation. Finally in the same session we elicit again their principles regarding the fairness and unfairness of allocations in the same three scenarios. Our results show that individuals adjust abstract norms to fit the game, their role and the choices they made. First, norms that appear abstract and universal take into account the bargaining power of the two sides. The strong side bends the norm in its favor and the weak side agrees : Stated fairness is a compromise with power. Second, in most situations, individuals adjust the range of fair shares after playing the game for real money compared with their initial statement. Third, the discrepancy between hypothetical and real behavior is larger in games where real choices have no strategic consequence (Dictator game and second mover in Trust game) than in those where they do (Ultimatum game). Finally the adjustment of principles to actions is mainly the fact of individuals who behave more selfishly and who have a stronger bargaining power. The moral hypocrisy displayed (measured by the discrepancy between statements and actions chosen followed by an adjustment of principles to actions) appears produced by the attempt, not necessarily conscious, to strike a balance between self-image and immediate convenience. |
| Keywords: | Moral hypocrisy; fairness; social preferences; power; self-deception |
| Date: | 2012–05–30 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00702578&r=hpe |
| By: | Christopher L. Foote; Kristopher S. Gerardi; Paul S. Willen |
| Abstract: | This paper presents 12 facts about the mortgage market. The authors argue that the facts refute the popular story that the crisis resulted from financial industry insiders deceiving uninformed mortgage borrowers and investors. Instead, they argue that borrowers and investors made decisions that were rational and logical given their ex post overly optimistic beliefs about house prices. The authors then show that neither institutional features of the mortgage market nor financial innovations are any more likely to explain those distorted beliefs than they are to explain the Dutch tulip bubble 400 years ago. Economists should acknowledge the limits of our understanding of asset price bubbles and design policies accordingly. |
| Keywords: | Mortgage loans ; Global financial crisis ; Housing - Prices ; Foreclosure |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbpp:12-2&r=hpe |