|
on Post Keynesian Economics |
| By: | Stefan Ederer; Armon Rezai |
| Abstract: | We study endogenous employment and distribution dynamics in a Post-Keynesian model of Kalecki-Steindl tradition. Productivity adjustments stabilise employment and the labour share in the long run: technological change allows firms to replenish the reserve army of workers in struggle over income shares and thereby keep wage demands in check. We discuss stability conditions and the equilibrium dynamics. This allows us to study how legal working time and its reduction affect the equilibrium. We find that a demand shock is likely to lower the profit share and increase the employment rate. A supply shock in contrast tends to have detrimental effects on employment and income distribution. Labour market institutions and a working time reduction have no long-term effect on growth, distribution and inflation in the model. The effects on the level of capital stock and output however are positive in a wage-led demand regime. Furthermore, an erosion of labour market institutions dampens inflation temporarily. The model provides possible explanations as to the causes of several current economic phenomena such as secular stagnation, digitalisation, and the break-down of the Philips curve. |
| Keywords: | Post-Keynesian economics, productivity, technological change, income distribution, employment |
| Date: | 2020–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2020:i:598&r=all |
| By: | Laura Aufrère (CEPN - Centre d'Economie de l'Université Paris Nord - USPC - Université Sorbonne Paris Cité - CNRS - Centre National de la Recherche Scientifique - Université Sorbonne Paris Nord); Philippe Eynaud (GREGOR - Groupe de Recherche en Gestion des Organisations - UP1 - Université Panthéon-Sorbonne - IAE Paris - Sorbonne Business School); Lionel Maurel (CERSA - Centre d'Etudes et de Recherches de Sciences Administratives et Politiques - UP2 - Université Panthéon-Assas - CNRS - Centre National de la Recherche Scientifique); Corinne Vercher-Chaptal (CEPN - Centre d'Economie de l'Université Paris Nord - USPC - Université Sorbonne Paris Cité - CNRS - Centre National de la Recherche Scientifique - Université Sorbonne Paris Nord) |
| Abstract: | The article considers alternatives to platform capitalism in a logic of Polanyian re-embedding. Stemming from case studies in the car-pooling, delivery and hosting sectors, the results uncover hybrid business models in which the market principle is used in the service of reciprocal logic. Rejecting the formal algorithmic rationality of capitalist platforms, the alternatives seek to align individual and collective behavior with values of solidarity and goals of general interest. They are experimenting with original methods of scaling up, based on the federation of communities, respectful of their anchoring in the substantive economy. The results make it possible to think of complementarities between different forms of embedding likely to be played out on several scales, and open perspectives for rethinking public policies vis-à-vis the experiments of the solidarity economy and the commons. |
| Abstract: | L'article envisage les alternatives au capitalisme de plateforme dans une logique de réencastrement polanyien. Issus d'études de cas dans les secteurs du co-voiturage, de la livraison et de l'hébergement, les résultats mettent au jour des modèles d'activité hybrides au sein desquels le principe marchand est mis au service de la logique réciprocitaire. Rejetant la rationalité algorithmique formelle des plateformes capitalistes, les alternatives cherchent à aligner les comportements individuels et collectifs sur les valeurs de solidarité et les finalités d'intérêt général. Elles expérimentent des modalités originales de passage à l'échelle, basées sur la fédération de communautés, respectueuses de leur ancrage dans l'économie substantive. Les résultats permettent de penser des complémentarités entre différentes formes d'encastrement susceptibles de se jouer à plusieurs échelles, et ouvrent des perspectives pour repenser les politiques publiques vis-à-vis des expérimentations de l'économie solidaire et des communs. |
| Keywords: | Digital platforms,platform cooperativism,re-embedding,decommodification,reciprocity,substantive economy,Plateformes numériques,coopérativisme de plateforme,ré-encastrement,démar- chandisation,réciprocité,économie substantive |
| Date: | 2020–04–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02536020&r=all |
| By: | Ederer, Stefan; Rehm, Miriam |
| Abstract: | The paper investigates how including the distribution of wealth changes the demand effects of redistributing functional income. It develops a model with an endogenous wealth distribution and shows that the endogenous rise in wealth inequality resulting from a redistribution towards profits weakens the growth effects of this redistribution. Consequently, a wage-led regime becomes more strongly wage-led. A profit-led regime on the other hand becomes less profit-led and there may even be a regime switch - in this case the short-run profit-led economy becomes wage-led in the long run due to the endogenous effects of wealth inequality. The paper thereby provides a possible explanation for the instability of demand regimes over time. |
| Keywords: | Wealth,Distribution,Aggregate Demand |
| JEL: | D31 D33 E12 E21 E25 E64 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifsowp:4&r=all |
| By: | Quaas, Friedrun |
| Keywords: | Pluralismusdebatte,Monismus,Orthodoxie,Heterodoxie,Mainstream,Neoklassik,Kritischer Rationalismus,Kritischer Realismus,Pluralism,Monism,Orthodoxy,Heterodoxy,Mainstream Economics,Neoclassical Economics,CriticalRationalism,Critical Realism |
| JEL: | B13 B25 B41 B50 B53 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:leiwps:165&r=all |
| By: | Veronica Guerrieri; Guido Lorenzoni; Ludwig Straub; Iván Werning |
| Abstract: | We present a theory of Keynesian supply shocks: supply shocks that trigger changes in aggregate demand larger than the shocks themselves. We argue that the economic shocks associated to the COVID-19 epidemic—shutdowns, layoffs, and firm exits—may have this feature. In one-sector economies supply shocks are never Keynesian. We show that this is a general result that extend to economies with incomplete markets and liquidity constrained consumers. In economies with multiple sectors Keynesian supply shocks are possible, under some conditions. A 50% shock that hits all sectors is not the same as a 100% shock that hits half the economy. Incomplete markets make the conditions for Keynesian supply shocks more likely to be met. Firm exit and job destruction can amplify the initial effect, aggravating the recession. We discuss the effects of various policies. Standard fiscal stimulus can be less effective than usual because the fact that some sectors are shut down mutes the Keynesian multiplier feedback. Monetary policy, as long as it is unimpeded by the zero lower bound, can have magnified effects, by preventing firm exits. Turning to optimal policy, closing down contact-intensive sectors and providing full insurance payments to affected workers can achieve the first-best allocation, despite the lower per-dollar potency of fiscal policy. |
| JEL: | E21 E32 E60 I18 |
| Date: | 2020–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26918&r=all |
| By: | Fabien Tarrit (REGARDS - Recherches en Économie Gestion AgroRessources Durabilité Santé- EA 6292 - URCA - Université de Reims Champagne-Ardenne) |
| Abstract: | The present paper questions the relation between Marx's theory and the issues of social justice. We first introduce an interpretation claiming that a theory of justice in itself is useless because idealist. We compare it with an interpretation for which founding a critique of capitalism on standards of justice allows to avoid an economist failure which denies individuality. |
| Abstract: | La présente contribution interroge le rapport de la théorie de Marx aux problématiques en termes de justice sociale. Nous proposons une interprétation selon laquelle une théorie de la justice en soi est inutile car idéaliste. Nous la confrontons à une lecture qui implique qu'une critique du capitalisme fondée sur des critères de justice est nécessaire afin d'éviter l'écueil économiste niant l'individualité. Abstract This paper questions the relation between Marx's theory and the issues of social justice. We first introduce an interpretation claiming that a theory of justice in itself is useless because it is idealist. We compare it with an interpretation that implies that a critique of capitalism based on standards of justice allows to avoid the economic pitfall which denies individuality. |
| Keywords: | Mots-clefs : Justice,matérialisme historique,liberté réelle,exploitation Keywords : Justice,Superstructure,Historical Materialism,Real Freedom,Exploitation Classification JEL : A13 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02515968&r=all |
| By: | Atif R. Mian; Ludwig Straub; Amir Sufi |
| Abstract: | Rising income inequality since the 1980s in the United States has generated a substantial increase in saving by the top of the income distribution, which we call the saving glut of the rich. The saving glut of the rich has been as large as the global saving glut, and it has not been associated with an increase in investment. Instead, the saving glut of the rich has been linked to the substantial dissaving and large accumulation of debt by the non-rich. Analysis using variation across states shows that the rise in top income shares can explain almost all of the accumulation of household debt held as a financial asset by the household sector. Since the Great Recession, the saving glut of the rich has been financing government deficits to a greater degree. |
| JEL: | D31 E21 E44 |
| Date: | 2020–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26941&r=all |
| By: | Heikkilä, Jussi |
| Abstract: | How does economics research help in solving societal challenges? This brief note sheds additional light on this question by providing ways to connect Journal of Economic Literature (JEL) codes and Sustainable Development Goals (SDGs) of the United Nations. These simple linkages illustrate that the themes of SDGs have corresponding JEL classification codes. As the mappings presented here are necessarily imperfect and incomplete, there is plenty of room for improvements. In an ideal world, there would be a JEL classification system for SDGs, a separate JEL code for each of the 17 SDGs. |
| Keywords: | JEL codes; social development goals; Agenda 2030; keyword search |
| JEL: | A11 O20 Q01 |
| Date: | 2020–04–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:99559&r=all |
| By: | Hugh Rockoff |
| Abstract: | The creation of the National Bureau of Economic Research was a response to the bitter controversies over the distribution of income that roiled the United States during the Progressive Era. Thanks to Malcolm Rorty, a business economist, and Nahum I. Stone, an independent socialist economist, a “Committee on the Distribution of Income” was created; what might be considered the first name of the Bureau. Funding was secured, the Bureau was chartered in 1920, and Wesley Mitchell was appointed the director of research. The Bureau’s first publication, Income in the United States, its Amount and Distribution was widely hailed as a major contribution. Further estimates of national income and its distribution for the 1920s were made by Willford King and Lillian Epstein. The Great Depression led to legislation requiring federal government estimates. Simon Kuznets was seconded from the Bureau to the Commerce Department where he led the team that produced the first federal estimates and established the unit for producing updates. The early investigators at the Bureau proved to be masters of combining sources of data to produce credible estimates. The result was estimates that still underlie our understanding of the growth and fluctuations of the American Economy. |
| JEL: | B0 N12 |
| Date: | 2020–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26895&r=all |
| By: | Umlauft, Thomas |
| Abstract: | Bitcoin and other cryptocurrencies’ spectacular rise over the past years has attracted considerable public and academic interest. The important question arising in this context is whether cryptocurrencies can legitimately be regarded as money. This paper contributes to the current discourse by evaluating cryptocurrencies’ monetary merits based on (1) the orthodox, or Metallist, school of money and (2) the heterodox, or Chartalist, approach. The theoretical as well as empirical findings advanced in this paper serve to illustrate that cryptocurrencies cannot legitimately be regarded as money owing to their lack of essential characteristics universally shared by other monetary systems. By cryptocurrencies’ lack of intrinsic value as well as government support, virtual currencies fail according to the orthodox as well as the heterodox school of money, respectively. In addition, the inelasticity of the bitcoin stock due to the fixed maximum amount of 21 million units stands in sharp contrast to that of other monetary systems – including gold and other depletable resources –, further reducing bitcoin’s suitability as a medium of exchange, and thus as money. In an attempt to explain the apparent discrepancy between the current value the market attaches to cryptocurrencies and their monetary deficiencies, we advance that market participants are misled by what we term the input fallacy of value (IFV). Similar to the labour theory of value, which posits that value is a function of the labour required to produce a good or service, market participants appear to be misled into believing that the value of cryptocurrencies is the product of the input costs required in the “mining” process. In this context, it is overlooked that value, far from merely being a function of labour and capital deployed, is solely determined by the resultant utility. Since, however – as detailed in this paper –, bitcoin lacks the essential characteristics associated with money, cryptocurrencies’ utility, and hence price, should tend towards zero over time. |
| Keywords: | Bitcoin, Cryptocurrencies, Economic Bubbles, Nature of Money, Origin of Money, Theories of Money, Money, Medium of Exchange, Orthodox School of Money, Heterodox School of Money, Chartalist School, Metallist School, Labour Theory of Value, Input Fallacy of Value, Stone Currency of Yap |
| JEL: | B12 B13 B15 B25 B59 E31 E41 E42 E51 E58 N10 N20 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:99302&r=all |
| By: | Schnabl, Gunther; Sonnenberg, Nils |
| Abstract: | The paper analyses in light of Austrian and Keynesian economic theory the impact of conventional and unconventional monetary policies as therapies for financial crises. It compares the financial market stabilization measures of the Federal Reserve System and the European System of Central Banks in response to the US subprime crisis and the European financial and debt crisis. It is shown that the Federal Reserve System's crisis measures were more directed towards stabilizing the banking system, whereas the European Central Bank had a stronger focus on the stabilization of the debt affordability of euro area crisis countries. In both cases, household credit growth remained under control despite renewed monetary expansion, while new imbalances emerged in the corporate sector. In the euro area, loose monetary policy had a destabilizing impact on the financial sector. |
| Keywords: | Financial cycles,financial crisis,financial stability,Hayek,Keynes,monetarypolicy |
| JEL: | B53 E12 E14 E30 E44 E58 G10 G20 H30 H50 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:leiwps:166&r=all |
| By: | Ederer, Stefan; Mayerhofer, Maximilian; Rehm, Miriam |
| Abstract: | This paper estimates rates of return across the gross wealth distribution in eight European countries. Like differential saving rates, differential rates of return matter for Post Keynesian theory, because they impact the income and wealth distribution and add an explosive element to growth models. We show that differential rates of return matter empirically by merging data on household balance sheets with longrun returns for individual asset categories. We find that (1) the composition of wealth differentiates between three socioeconomic groups: 30% are asset-poor, 65% are middle-class home owners, and the top 5% are business-owning capitalists; (2) rates of return rise across all groups; and (3) rates of return broadly follow a log-shaped function across the distribution, where inequality in the lower half of the distribution is higher than in the upper half. If socioeconomic groups are collapsed into the bottom 95% workers and top 5% capitalists, then rates of return are 5.6% for the former and 7.2% for the latter. |
| Keywords: | rate of return,differential,wealth,distribution |
| JEL: | D31 D33 E43 E12 E21 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifsowp:2&r=all |
| By: | Patrinos,Harry Anthony |
| Abstract: | Truth matters, and the norms associated with a democratic society, such as the common good, responsibility, ethics, and civic engagement, are under attack with the emergence of the post-truth society. There are concerns worldwide that public education is failing us on pushing back on disinformation. And, in most countries, education systems are not providing workers with the skills necessary to compete in today's job markets. The growing mismatch between demand and supply of skills holds back economic growth and undermines opportunity. At same time, the financial returns to schooling are high in most countries. Schooling remains a good economic and social investment, and there are record numbers of children in school today. The skills that matter in the coming technological revolution are likely the same as what is needed in a media environment of disinformation. More and better education and noncognitive skills will not only prepare students for the future world of work, they will also prepare them to navigate the increasingly complex post-truth society. They will also allow young people to gain trust. In other words, better education is democratizing, to the extent that it promotes truth, values, and civic engagement. |
| Date: | 2020–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:9214&r=all |
| By: | Handy, Susan |
| Abstract: | Californians live in a car-dominant society. Decades of transportation and land use planning practices have created communities in which driving is a virtual necessity to access most destinations. Personal vehicles provide mobility benefits, but they also have many negative financial, public health, environmental, and social impacts. Technological innovations such as vehicle electrification can lessen some, but not all, of these impacts. A more comprehensive approach is to shape communities in a manner that gives people viable options other than a personal vehicle—such as walking, bicycling, or transit—to get where they need to go. Researchers at UC Davis reviewed published studies to summarize the range of household- and community-level benefits that can be realized by reducing car dependence in California. This policy brief summarizes the findings of that work. View the NCST Project Webpage |
| Keywords: | Social and Behavioral Sciences, Automobile travel, sustainable transportation, sustainable development, infill, automobile dependence |
| Date: | 2020–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsdav:qt7js9s5jk&r=all |
| By: | Masashi Goto (Research Institute for Economics and Business Administration, Kobe University, Japan) |
| Abstract: | This study explores how professional institutional change is theorized in the context of the emergence of disruptive technology as a precipitating jolt. I conducted a case study of two Big four accounting firms in Japan on their initiatives to apply artificial intelligence (AI) to their core audit services between 2015 and 2017. The data shows the process for incumbent dominant organizations to collaborate and develop social perceptions about the changing but continuing relevance of their profession. The analysis suggests that the retheorization can advance even without concrete alternative templates when disruptive technology is perceived to have overwhelming influences, following multi-level steps progressing from internal to external theorization. This article proposes a grounded theory model of the process of professional institutional change: (1) Theorizing change internally at the field, (2) Developing solutions by experimentations in organizations, (3) Exploring solutions driven by individuals in organizations and (4) Theorizing change externally by organizations. It contributes to the profession and institutional scholarship by expanding our knowledge about the diversity of professional institutional field change process in this age of increasing technology influences on organizations. |
| Keywords: | Institutional change; Professions; Artificial intelligence; Qualitative research; Grounded theory |
| Date: | 2020–03 |
| URL: | http://d.repec.org/n?u=RePEc:kob:dpaper:dp2020-12&r=all |
| By: | Ozili, Peterson; Arun, Thankom; |
| Abstract: | How did a health crisis translate to an economic crisis? Why did the spread of the coronavirus bring the global economy to its knees? The answer lies in two methods by which coronavirus stifled economic activities. First, the spread of the virus encouraged social distancing which led to the shutdown of financial markets, corporate offices, businesses and events. Second, the exponential rate at which the virus was spreading, and the heightened uncertainty about how bad the situation could get, led to flight to safety in consumption and investment among consumers, investors and international trade partners. |
| Keywords: | Covid-19, Coronavirus, SARS-CoV-2, outbreak, pandemic, financial crisis, global recession, public health, spillovers, monetary policy, fiscal policy, liquidity provision, Central banks. |
| JEL: | E3 G15 G28 H81 H84 I1 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:99317&r=all |
| By: | Martin S. Eichenbaum; Sergio Rebelo; Mathias Trabandt |
| Abstract: | We extend the canonical epidemiology model to study the interaction between economic decisions and epidemics. Our model implies that people’s decision to cut back on consumption and work reduces the severity of the epidemic, as measured by total deaths. These decisions exacerbate the size of the recession caused by the epidemic. The competitive equilibrium is not socially optimal because infected people do not fully internalize the effect of their economic decisions on the spread of the virus. In our benchmark scenario, the optimal containment policy increases the severity of the recession but saves roughly half a million lives in the U.S. |
| JEL: | E1 H0 I1 |
| Date: | 2020–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26882&r=all |