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on History and Philosophy of Economics |
| By: | Elias Julio Jorge; Castro Walter |
| Abstract: | Many scholars, especially from other disciplines, have voiced concerns regarding an oversimplified interpretation of Adam Smith's ideas, asserting that it has been exploited to advance a particular free market ideology. This paper uses Galenson's economic framework for creativity to analyze Adam Smith's approach to innovation and some of his main contributions. Galenson distinguishes between two types of innovators in art: the conceptual and the experimental. We show that Smith exhibits all the characteristics of the experimental innovator. His experimental approach is evident in the development of The Theory of Moral Sentiments and many of the ideas developed in The Wealth of Nations. Smith has had a significant influence on important conceptual innovators in economics of the 20th century, such as Paul Samuelson, George Stigler, Robert Lucas and Gary Becker. Conceptual innovators often tend to simplify by using abstraction. Their effort to formalize and incorporate Smith ideas using a conceptual language may explain why there is a simplified understanding of Smith and his contributions. |
| JEL: | B12 O31 |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:aep:anales:4649&r=hpe |
| By: | James J. Heckman; Rodrigo Pinto |
| Abstract: | This paper examines the econometric causal model and the interpretation of empirical evidence based on thought experiments that was developed by Ragnar Frisch and Trygve Haavelmo. We compare the econometric causal model with two currently popular causal frameworks: the Neyman-Rubin causal model and the Do-Calculus. The Neyman-Rubin causal model is based on the language of potential outcomes and was largely developed by statisticians. Instead of being based on thought experiments, it takes statistical experiments as its foundation. The Do-Calculus, developed by Judea Pearl and co-authors, relies on Directed Acyclic Graphs (DAGs) and is a popular causal framework in computer science and applied mathematics. We make the case that economists who uncritically use these frameworks often discard the substantial benefits of the econometric causal model to the detriment of more informative analyses. We illustrate the versatility and capabilities of the econometric framework using causal models developed in economics. |
| JEL: | C10 C18 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31945&r=hpe |
| By: | Davis, John B.; ; (Department of Economics Marquette University; Department of Economics Marquette University) |
| Abstract: | This paper discusses Richard Arena’s insightful and original contributions to interpreting the important interaction between Piero Sraffa and Ludwig Wittgenstein. It discusses this in terms of dilemmas they each encountered in transitions in their thinking in the 1930s, emphasizes the influence of Sraffa’s unpublished “Surplus Product†text, compares Sraffa’s critique of “natural science point of view†and Wittgenstein’s critique of logical form, and compares Sraffa’s later understanding of the relationship between production and distribution and Wittgenstein’s later understanding of forms of life and language-games. The paper argues this thinking opened up a approach to economic philosophy in connection with the distinction between open and closed systems. Arena has been a leading proponent open systems thinking in economics. He thus reminds us, in Wittgenstein’s words – ‘Don’t think, but look!’ – or look beyond what one might think ones sees in a closed systems way. |
| Keywords: | Arena, Sraffa, Wittgenstein, surplus product, language games, open-closed systems |
| JEL: | B24 B30 B40 B51 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:mrq:wpaper:2023-06&r=hpe |
| By: | Kleiner, George |
| Abstract: | The publication is devoted to theoretical foundations in the field of system socio¬economic space, reflected in the works of Russian philosopher and encyclopedist A.A.Bogdanov. Based on the concept of socially-organized experience, reflecting basic principles about the laws of organization, acting in technology (organization of things), economy (organization of people), politics (organization of ideas), the article substantiates the idea of the special role of space and time, first proposed by A.Bogdanov in relation to economic systems and system economic theory. In this conceptual context searching for new approaches and rethinking of theoretical capital are considered in order to transform economic systems in the direction of increasing their efficiency. It is noted that Bogdanov’s concept is the first scientific concept that integrates the ideas of cybernetics, general systems theory and synergetics. The author draws attention to the Bogdanov’s attempt to generalize the universal organizational laws governing the behavior and structure of fundamentally new complex systems, which is characterized as “universal organizational science.” The article develops a conceptual model of qualitative equilibrium interaction of the basic subsystems of the economic system in the context of information exchange. Based on the presented information model of the economic system in accordance with Bogdanov’s ideas conclusions are drawn that this teaching, in combination with modern systemic economic theory, can become the theoretical basis for general economic analysis. Arguments are given in favor of a revival of interest in understanding the ideas of Bogdanov, in particular in understanding the “space of the economy” and the concept of “conscious cooperation”, which can complement or oppose the concept of competition. His main ideas about a society based on “consciously comradely principles” are noted, which are of scientific interest in the context of regulating the fair and dishonest behavior of economic entities. The article allows us to approach the assessment of the diversity of Bogdanov’s ideas from different positions, reserving the opportunity for each scientist to form his own view and approach to this process of rethinking his many theses and tools. |
| Keywords: | organizational science, space and time, tectology, economic system, system economic theory, information model, basic subsystems |
| JEL: | A1 A10 |
| Date: | 2023–04–28 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:119375&r=hpe |
| By: | Sebastian Edwards |
| Abstract: | In this paper I analyze the work on exchange rates and external imbalances by University of Chicago faculty members during the university’s first hundred years, 1892-1992. Many people associate Chicago’s views with Milton Friedman’s advocacy for flexible exchange rates. But, of course, there was much more than that, including the work of J. Laurence Laughlin on bimetallism, Jacob Viner on the balance of payments, Lloyd Metzler on transfers, Harry Johnson on trade and currencies, Lloyd Mints on exchange rate regimes, Robert Mundell on optimal currency areas, and Arnold Harberger on shadow exchange rates, among other. The analysis shows that, although different scholars emphasized different issues, there was a common thread in this research, anchored on the role of relative prices’ changes during the adjustment process. |
| JEL: | B22 E52 E58 F31 F33 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31928&r=hpe |
| By: | Barry Chiswick (George Washington University) |
| Abstract: | This paper is a review of the literature in economics up to the early 1980s on the issue of estimating the earnings return to schooling and labor market experience. It begins with a presentation of Adam Smith's (1776) analysis of wage determination, with the second of his five points on compensating wage differentials being "the easiness or cheapness, or the difficulty and expense" of acquiring skills. It then proceeds to the analysis by Walsh (1935) estimating the net present value of investments at various levels of educational attainment. Friedman and Kuznets (1945) also used the net present value method to study the earnings in five independent professional practices. Based on the net present value technique, Becker (1964) estimates internal rates of return from high school and college/university schooling, primarily for native-born white men, but also for other demographic groups. The first regression-based approach is the development of the schooling-earnings function by Becker and Chiswick (1966), which relates the logarithm of earnings, as a linear function of years invested in human capital, with the application to years of schooling. This was expanded by Mincer (1974) to the "human capital earnings function" (HCEF), which added years of post-school labor market experience. Attractive features of the HCEF are discussed. Extensions of the HCEF in the 1970s and early 1980s account for interrupted labor marker experience, geographic mobility, and self-employment and unpaid family workers. |
| Keywords: | Human Capital, Schooling Earnings Function, Human Capital Earnings Function, Schooling, Labor Market Experience, Women, Immigrants, Less Developed Countries, Self-Employed, Unpaid Workers |
| JEL: | I24 I26 J3 J46 J61 O15 B29 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:gwi:wpaper:2023-12&r=hpe |
| By: | Wendschlag, Mikael (Department of Economic History, Uppsala University) |
| Abstract: | In early April 1929, eight Swedish savings banks were found insolvent and closed due to economic crimes committed by some of their founders. After the crash, the Swedish parliament entered a debate about whether the state should cover some, all or none of the losses of the failed banks’ 88 000 depositors. The debate, mainly between the right party and the social democrats, was characterized by competing narratives about the causes of the crash, whether the state should intervene or not, whether there existed an implicit deposit insurance or not, who should be covered among the depositors, by how much, and how an intervention should be funded and administered. The debate, and the policy decision, is unique in Swedish banking history and illustrate the importance of narratives to understand political responses to bank crashes and crises. The debate ended in mid-May with a decision to partially cover the depositors’ losses. |
| Keywords: | bank crashes; competing narratives; deposit insurance; memories |
| JEL: | B52 G01 G28 H12 N24 |
| Date: | 2023–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uuehwp:2023_008&r=hpe |
| By: | Poinsot Flavia Gabriela; Llera Daniela S |
| Abstract: | El estudio del pensamiento hebreo-cristiano es importante, aunque parezca extraño a un economista contemporáneo. Sus ideas se ven reflejadas en corpus teóricos de varios Programas de Investigación a lo largo de la historia del pensamiento económico. El objetivo de este trabajo es presentar, sucintamente, las principales ideas y nociones económicas contenidas en el pensamiento hebreo-cristiano que luego pasan a formar parte de corrientes de pensamiento económico alternativas. Para ello se describen las ideas del pensamiento original y luego se desarrollan sus diferentes ramas que, a fines de simplificación y claridad, se condensan en el Antiguo y el Nuevo Testamento, los Padres de la Iglesia, la Escolástica con las ideas principales de Aquino, y el pensamiento protestante calvinista y luterano que emerge con la Reforma de 1517. Se considera que el estudio de esta corriente de pensamiento es relevante ya que su desconocimiento puede conducir a interpretaciones erróneas de teorías de economistas en quienes estas nociones aparecen implícita o explícitamente. |
| JEL: | B11 Z12 |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:aep:anales:4684&r=hpe |
| By: | Phoebe Koundouri; Nikitas Pittis (University of Piraeus, Greece); Panagiotis Samartzis |
| Abstract: | Economic rationality puts constraints on the preferences and/or degrees of belief (subjective probabilities or credences) of a decision maker (DM). This paper focuses on a belief-based definition of rationality (referred to as BEL): BEL requires DM's credences to be precise, unique, ascertainable, coherent and asymptotically accurate. We distinguish two types of DMs, the "expert"(DMs) and the "naive"(DMo) ones, and ask whether and how BEL may be achieved by either of them. To answer this we define two sets of cognitive/epistemic properties, Ys and Yo for DMs and DMo, respectively and show that Ys and Yo form the basis of the corresponding processes (referred to as Bayesian Confirmation (BC) and "trial and error, frequency-based (TEFB), respectively) by which DMs and DMo reach BEL. This means that on the assumption that Ys and Yo are empirically valid, the naive decision maker thinks probabilistically "as-if" she were the expert. An important difference between this paper and the related literature concerns the obscurity" of the "as-if" process. In our approach, this is a concrete process, namely TEFB, instead of an unspecified, "black box" one. We also argue that some of the assumptions in Yo (on which standard arguments of rationality - such as the Dutch Book and Arbitrage arguments - are based) are empirically questionable. Finally, we suggest that although BEL is the normative standard against which beliefs must be measured and judged, the actual rationality of decision makers comes in degrees (graded rationality). The smooth functioning of the economic system requires decision makers who are "sufficiently" rather than "perfectly" rational. |
| JEL: | C44 D81 D83 D89 |
| Date: | 2023–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:aue:wpaper:2322&r=hpe |
| By: | Ali Almelhem (The World Bank); Murat Iyigun (University of Colorado, Boulder & IZA); Austin Kennedy (University of Colorado, Boulder); Jared Rubin (Chapman University) |
| Abstract: | Using textual analysis of 173, 031 works printed in England between 1500 and 1900, we test whether British culture evolved to manifest a heightened belief in progress associated with science and industry. Our analysis yields three main fndings. First, there was a separation in the language of science and religion beginning in the 17th century. Second, scientifc volumes became more progress-oriented during the Enlightenment. Third, industrial works—especially those at the science-political economy nexus—were more progress-oriented beginning in the 17th century. It was therefore the more pragmatic, industrial works which refected the cultural values cited as important for Britain’s takeof. |
| Keywords: | language, religion, science, political economy, progressiveness, Enlightenment, Industrial Revolution |
| JEL: | C81 C88 N33 N63 O14 Z11 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:chu:wpaper:23-13&r=hpe |
| By: | Vlada V. Asadulaeva (National Research University Higher School of Economics) |
| Abstract: | Although a certain incommensurability between Soviet and Western Marxism has been assumed in a wide variety of studies, no research has been done on the genesis of the split between the two traditions in the context of the political turmoil of the 1920s. The current study aims to address this issue. By highlighting the commitment of the so-called ‘fathers of Western Marxism’ to the political tactics of left communism, I argue that the tradition of Western Marxism emerged specifically as a philosophical justification for what in the Soviet Union was considered the ‘ultra-left’ political ideology. Further, I demonstrate that that the works of Karl Korsch and Georg Lukacs were read precisely in this light by the Bolshevik philosophers whose criticism marked an important watershed in the genesis of the split between Western and Soviet Marxists. |
| Keywords: | Western Marxism, Soviet Marxism, Georg Lukacs, Karl Korsch, Left Communism |
| JEL: | Z00 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:212/hum/2023&r=hpe |
| By: | Guillaume Carton (EM - emlyon business school); Bertrand Valiorgue (EM - emlyon business school) |
| Abstract: | The Shift Project recently challenged French management scholars on the lack of commitment regarding the ecological and energy transition of the various higher education structures. To evaluate if this call to change French management education has some chances of success, we compare what the Shift Project proposes today with the transformation program of management education implemented by the Ford foundation between 1954 and 1966 in the USA. This comparison makes it possible to identify three principles of action likely to lead to a greater integration of ecological and energy issues in French higher management education structures. It also allows us to understand that the FNEGE is likely to play a pivotal role in this transition dynamic. |
| Abstract: | Le Shift Project a récemment interpellé les différentes structures de l'enseignement supérieur de gestion afin qu'elles acroissent leur engagement en matière de transition écologique et énergétique. Afin de déterminer si cet appel à la réforme peut aboutir, nous évaluons les propositions du Shift Project à l'aune de celles mises en œuvre par la fondation Ford aux États-Unis dans les années 1950/1960. Cette comparaison permet de dégager trois principes d'action susceptibles de conduire à une meilleure intégration des enjeux écologiques et énergétiques. Elle permet également de comprendre que la FNEGE est susceptible de jouer un rôle pivot dans cette dynamique de transition. |
| Keywords: | Anthropocene, Energy and ecological transition, Higher education in management, Scientific and pedagogical paradigm, Ford Foundation, Shift Project, FNEGE |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04294618&r=hpe |
| By: | Valérie Mignon; Marc Joëts; Bertrand Candelon |
| Abstract: | This paper aims to identify the factors contributing to the diffusion of ideas in econometrics by paying particular attention to connectivity in content and social networks. Considering a sample of 17, 260 research papers in econometrics over the 1980-2020 period, we rely on Structural Topic Models to extract and categorize topics relevant to key domains in the discipline. Using a hurdle count model, we show that both content and social connectivity among the authors (i.e., social connectivity) enhance the likelihood of non-zero citation counts and play a key role in shaping the diffusion of econometric ideas. We also find that high topic connectivity augmented by robust social connectivity among authors or authoring teams further enhances econometric ideas' diffusion success. Finally, our findings unveil an inverted U-shaped relationship between connectivity and the success of idea diffusion; the latter initially escalates but starts to wane upon reaching a certain threshold. |
| Keywords: | Connectivity; Idea diffusion; Econometric publications; Citations; Structural Topic Model; Hurdle count model. |
| JEL: | C01 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:drm:wpaper:2023-35&r=hpe |