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on History and Philosophy of Economics |
| By: | E. Roy Weintraub |
| Abstract: | This essay reviews new histories of the role of game theory and rational decision-making in shaping the social sciences, economics among them, in the post war period. The recent books The World the Game Theorists Made by Paul Erickson and How Reason Almost Lost Its Mind by Paul Erickson, Judy Klein, Lorraine Daston, Rebecca Lemov, Thomas Sturm, and Michael Gordin raise a number of complex historical questions about the interconnections among game theory, utility theory, decision-theory, optimization theory, information theory and theories of rational choice. Moreover the contingencies of time, place, and person call into question the usefulness of economists’ linear narratives about the autonomous and progressive development of modern economics. The essay finally reflects on the challenges that these issues present for historians of recent economics. |
| Keywords: | game theory, rational choice |
| JEL: | A11 A12 B2 C02 C6 C7 D01 D7 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hec:heccee:2016-19&r=hpe |
| By: | Heinrich H. Nax; Ryan O. Murphy; Dirk Helbing |
| Abstract: | We study the stability and welfare properties of merit-based (meritocratic) group-matching mechanisms in voluntary contribution games. Meritocratic matching in this context means that players tend to be assortatively grouped according to their contributions. We let regimes di ffer from one another with respect to their matching fidelity. The stability analysis summarizes as follows. When there is not enough meritocracy, the only equilibrium state is universal free-riding. Above a first threshold, several Nash equilibria above free-riding emerge, but only the free-riding equilibrium is stochastically stable. There exists a second meritocratic threshold, above which an equilibrium with high contributions becomes the unique stochastically stable state. This operationalization of meritocracy sheds light on critical transitions, that are enabled by contribution-assortative matching, between equilibria related to "tragedy of the commons |
| Keywords: | meritocracy; voluntary contribution; public goods; stochastic stability; evolutionary stability; assortative matching; welfare; efficiency-equality tradeoff |
| JEL: | C73 D02 D63 |
| Date: | 2014–10–21 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:65444&r=hpe |
| By: | Silvestri, Paolo (University of Turin) |
| Abstract: | With this paper I try to sketch a research agenda on the basis of which humanities and social sciences might interact with each other, searching for a human common ground in tax issues. To this purpose I shall proceed as follows: (§2) I will sketch two working hypotheses showing how and why tax system raises anthropological issues at the intersection of Philosophy of law, Politics and Economics; to restrict the field of enquiry, I will then analyse, firstly (§2.1), the most common theories of taxation – benefit-cost principle and ability-to-pay principle – usually meant as attempts to answer the demand for tax justice; and, secondly (§2.2), the issue of freedom in taxation as a problem of legal-political and economic obligation. I will then show how the research might gain some insight from both (§3.1) the literature on homo reciprocans, and (§3.2) the literature on gift-giving, which might allow us to better articulate the demands for justice and freedom, as well as to glimpse the human foundations of a new fiscal democracy. |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:uto:dipeco:201534&r=hpe |
| By: | Nina Dodig (Berlin School of Economics and Law, and Institute for International Political Economy Berlin (IPE)); Hansjorg Herr (Berlin School of Economics and Law, and Institute for International Political Economy Berlin (IPE)) |
| Abstract: | This paper presents an overview of different models which explain financial crises, with the aim of understanding economic developments during and possibly after the Great Recession. In the first part approaches based on efficient markets and rational expectations hypotheses are analyzed, which however do not give any explanation for the occurrence of financial crises and thus cannot suggest any remedies for the present situation. A broad range of theoretical approaches analyzing financial crises from a medium term perspective is then discussed. Within this group we focused on the insights of Marx, Schumpeter, Wicksell, Hayek, Fisher, Keynes, Minsky, and Kindleberger. Subsequently the contributions of the Regulation School, the approach of Social Structures of Accumulation and Post-Keynesian approach, which focus on long-term developments and regime shifts in capitalist development, are presented. International approaches to finance and financial crises are integrated into the analyses. We address the issue of relevance of all these theories for the present crisis and draw some policy implications. The paper has the aim to find out to which extent the different approaches are able to explain the Great Recession, what visions they develop about future development of capitalism and to which extent these different approaches can be synthesized. |
| Keywords: | theories of crisis, Marxian, Institutional, Keynesian, capitalism, finance, financial crisis |
| JEL: | B14 B15 B24 B25 E11 E12 E13 E32 |
| Date: | 2015–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:fes:wpaper:wpaper126&r=hpe |
| By: | Kevin D. Hoover |
| Abstract: | Situational analysis (also known as situational logic) was popularized by Karl Popper as an appropriate method for the interpretation of history and as a basis for a scientific social science. It seeks an objective posit ive explanation of behavior through imputing a dominant goal or motive to individuals and then identifying the action that would be objectively appropriate to the situation as the action actually taken. Popper regarded situational analysis as a generalization to all of social science of the prototypical reasoning of economics. Applied to history, situational analysis is largely an interpretive strategy used to understand individual behavior. In social sciences, however, it is applied many to types of beh avior or to group behavior (e.g., to markets) as is used to generate testable hypothesis. Popper’s account of situational analysis and some criticisms that have been levied against it are reviewed. The charge that situational analysis contradicts Popper’s view that falsification is the hallmark of sciences is examined and rejected: situational analysis is precisely how Popper believes social sciences are able to generate falsifiable, and, therefore, scientific hypotheses. Still, situational analysis is in tension with another of Popper’s central ideas: situational analysis as a method for generating testable conjectures amounts to a logic of scientific discovery, something that Popper argued elsewhere was not possible. |
| Keywords: | Situational analysis, situational logic, Karl Popper, falsification, context of discovery, context of justification |
| JEL: | B40 B41 A12 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hec:heccee:2016-17&r=hpe |
| By: | Akerlof, George; Snower, Dennis J. |
| Abstract: | Standard economics omits the role of narratives (the stories that people tell themselves and others) when they make all kinds of decisions. Narratives play a role in understanding the environment; focusing attention; predicting events; motivating action; assigning social roles and identities; defining power relations; and establishing and conveying social norms. This paper describes the role narratives play in decision making, as it also juxtaposes this description against the backdrop of the Bolshevik-spawned narrative that played a critical role in the history of Russia and the Soviet Union in the 20th Century. |
| Keywords: | attention; identity; motivation; Narrative; prediction; social assignment |
| JEL: | A12 A13 A14 D03 D04 D20 D23 D30 D62 D71 D72 D74 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11132&r=hpe |
| By: | Diogo Lourenço (Faculdade de Economia, Universidade do Porto); Mário Graça Moura (Faculdade de Economia, Universidade do Porto) |
| Abstract: | Implicitly, the Socialist Calculation Debate is about the connection between neoclassical theory and reality. It involves several ontological presuppositions, with wide-ranging implications. Our purpose is to discuss one of these presuppositions. We want to scrutinise the view, implicit in the ‘market socialist’ arguments, that things have economic roles or functions independently of the social environment in which they exist. ‘Primary factors’ and techniques of production are taken to exist independently of social arrangements; jointly with consumer preferences, they are supposed to define the economic problem of a community. In analysing this view, we borrow from F. A. Hayek, complementing his reflections with those of Donald Davidson, Willard Quine, and Tony Lawson. We also discuss a second problem, which follows from the first: if, in contrast with market socialists’ view, the economic roles of things depend holistically on complex social processes, how can we compare alternative forms of economic organisation? |
| Keywords: | Ontology, Socialist Calculation, Economic Function, Counterfactuals. |
| JEL: | B24 B25 B41 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:572&r=hpe |
| By: | Igor Fedyukin (National Research University Higher School of Economics) |
| Abstract: | This article explores the notion of discipline in Russia since the late 17th century and up to the accession of Catherine II. Discipline and disciplining occupy a central place in our thinking about early modern state, and the reconstruction of debates about school building helps to illuminate the ways in which this notion has been articulated. The article traces the emerging concern with using the school building as an instrument of confinement and surveillance, and demonstrates unexpected links between the Noble Cadet Corps in St Petersburg and Bentham's «Panopticn» via the Ecole Militaire in Paris. It argues that the peculiarly modern understanding of discipline was rooted in specific religious sensibilities that had not been developed in seventeenth-century Orthodox thinking. Rather, it stresses the central role of Pietism and the Pietists in introducing these notions in post-Petrine Russia, as well as the ways in which these notions have been appropriated, «domesticated,» and «secularized» by a variety of Russian palters. At the end, the article reflects on the relationship between discipline, religious sensibilities, was, and the estate in a non-Western early modern context |
| Keywords: | Russia, Peter I, Schools, Discipline, Pietism, Noble Cadet Corps, Panopticon, Surveillance |
| JEL: | Z |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:123hum2016&r=hpe |
| By: | Peters H.J.M.; Schröder M.J.W.; Vermeulen A.J. (GSBE) |
| Abstract: | We consider a variant of Hotellings location model that was proposed by Kohlberg 1983 when choosing a firm, consumers take travel time and also expected waiting time, which again depends on the number of consumers choosing that firm, into consideration. If we assume that firms are symmetric, then we show that a subgame perfect equilibrium exists if there is an even, but small, number of firms and no subgame perfect equilibrium exists if there is an odd, but small, number of firms. Further, we illustrate by means of examples what other subgame perfect equilibria exist if we allow for asymmetric firms. |
| Keywords: | Noncooperative Games; Market Structure and Pricing: Oligopoly and Other Forms of Market Imperfection; Real Estate Markets, Production Analysis, and Firm Location: General; |
| JEL: | C72 D43 R30 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:unm:umagsb:2015040&r=hpe |
| By: | Roman Frigg; Carl Hoefer |
| Abstract: | Classical statistical mechanics posits probabilities for various events to occur, and these probabilities seem to be objective chances. This does not seem to sit well with the fact that the theory’s time evolution is deterministic. We argue that the tension between the two is only apparent. We present a theory of Humean objective chance and show that chances thus understood are compatible with underlying determinism and provide an interpretation of the probabilities we find in Boltzmannian statistical mechanics. |
| JEL: | C1 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:37075&r=hpe |
| By: | Pavlina R. Tcherneva |
| Abstract: | Money, in this paper, is defined as a power relationship of a specific kind, a stratified social debt relationship, measured in a unit of account determined by some authority. A brief historical examination reveals its evolving nature in the process of social provisioning. Money not only predates markets and real exchange as understood in mainstream economics but also emerges as a social mechanism of redistribution, usually by some authority of power (be it an ancient religious authority, a king, a colonial power, a modern nation state, or a monetary union). Money, it can be said, is a "creature of the state" that has played a key role in the transfer of real resources between parties and the redistribution of economic surplus. In modern capitalist economies, the currency is also a simple public monopoly. As long as money has existed, someone has tried to tamper with its value. A history of counterfeiting, as well as that of independence from colonial and economic rule, is another way of telling the history of "money as a creature of the state." This historical understanding of the origins and nature of money illuminates the economic possibilities under different institutional monetary arrangements in the modern world. We consider the so-called modern "sovereign" and "nonsovereign" monetary regimes (including freely floating currencies, currency pegs, currency boards, dollarized nations, and monetary unions) to examine the available policy space in each case for pursuing domestic policy objectives. |
| Keywords: | History of Money; Monetary Sovereignty; Chartalism; Counterfeiting; Public Monopoly; Currency Issuers vs. Currency Users; Exchange Rate Systems |
| JEL: | B5 E6 E42 E63 N1 Z1 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_861&r=hpe |
| By: | Polemarchakis, Herakles (Department of Economics, University of Warwick) |
| Abstract: | Eventual consensus is the only property of a rational dialog. |
| Keywords: | dialog ; rationality ; agreement JEL classification numbers: D83 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:wcreta:19&r=hpe |
| By: | Georges Prat |
| Date: | 2016–02–18 |
| URL: | http://d.repec.org/n?u=RePEc:ipg:wpaper:2013-26&r=hpe |