Volume V Issue 2

Spring 2012

1. A theory of planning horizons (1): market design in a post-neoclassical world

Frederic Jennings.
The neoclassical case supporting competitive frames and market solutions has failed to promote stable world-wide economic development. Other approaches in economics incorporate social culture, increasing returns, market power, ecological limits and complementarity, yielding broader applications for development theory. In this paper a theory of planning horizons is introduced to raise some meaningful questions about the traditional view with respect to its substitution, decreasing returns and independence assumptions. Suppositions of complementarity, increasing returns and interdependence suggest that competition is inefficient by upholding a myopic culture resistant to learning. Growth – though long believed to rise from markets and competitive values – may not derive from these sources. Instead, as civilizations advance, shifting from material wants to higher-order intangible output, they evolve from market tradeoffs (substitution and scarcity) into realms of common need (complementarity and abundance). The policy implications of horizonal theory are explored, with respect to regulatory aims and economic concerns. Such an approach emphasizes strict constraints against entry barriers, ecological harm, market power abuse and ethical lapses. Social cohesion – not competition – is sought as a means to extend horizons and thereby increase efficiency, equity and ecological health. The overriding importance of horizon effects for regulatory assessment dominates other […]

2. Complexity and the culture of economics: a sociological and inter-disciplinary analysis

Hendrik van den Berg.
This paper offers a sociological explanation for why the field of economics has so severely restricted the scope of its analysis to the point where it failed to foresee the financial crises, economic recessions, and other large shifts in economic activity that have characterized the global economy in recent decades. This paper's analysis of the culture of economics draws heavily on the work of Pierre Bourdieu, the French sociologist who developed a useful framework with which to analyze the culture of an intellectual field like economics. Specifically, the paper describes how the neo-liberal doxa supports the restrictive neoclassical (marginalist) modeling approach that is a central element of the habitus of mainstream economics. Bourdieu's concept of symbolic violence shows how the orthodox economics culture perpetuates itself even in the face of the complete failure of the culture's favored neoclassical and rational expectations models to anticipate recent macroeconomic crises. The paper concludes with some thoughts on how this understanding of the culture of economics can enable economists to free themselves from the oppressive culture of mainstream economics.

3. The economist as shaman: revisioning our role for a sustainable, provisioning economy

Molly Cato.
In view of the problems heterodox economists have faced in predicting, explaining and finding solutions to the financial and ecological crises facing humanity, the paper takes a wide-angle view of the question of what the role of an economist might be in a sustainable society. I argue that the role of an economist is one of an intermediary between people and the resources they need for survival, a role that in less rationalist societies might have been performed by a priest or shaman. I propose three central responsibilities for an economist in a sustainable society: supporting a process of re-embedding the economy in the environment; negotiating a respectful—even reverential—relationship between humans and non-human species; ensuring a means of acquiring resources that minimises the entropic impact of the human community.

4. Behavioural Procedural Models - a multipurpose mechanistic account

Leonardo Ivarola ; Gustavo Marqués.
In this paper we outline an epistemological defence of what we call Behavioural Procedural Models (BPMs), which represent the processes of individual decisions that lead to relevant economic patterns as psychologically (rather than rationally) driven. Their general structure, and the way in which they may be incorporated to a multipurpose view of models, where the representational and interventionist goals are combined, is shown. It is argued that BPMs may provide “mechanistic-based explanations” in the sense defended by Hedström and Ylikoski (2010), which involve invariant regularities in Woodward’s sense. Such mechanisms provide a causal sort of explanation of anomalous economic patterns, which allow for extra market intervention and manipulability in order to correct and improve some key individual decisions. This capability sets the basis for the so called libertarian paternalism (Sunstein and Thaler 2003).

5. The evolution of merchant moral thought in Tokugawa Japan

Ryan Langrill.
The Tokugawa Era of Japan is known for its domination by the shogunate, or warrior bureaucracy. While samurai capture the popular imagination, the merchant class of this era was changing their cultural narrative as well. The regime, officially Neo-Confucian, considered trade a vulgar and corrupting activity, but among commoners, especially in Osaka, a culture arose celebrating the virtue of commerce. Merchant scholars and commoners assailed the orthodoxy by putting forth alternate interpretations of Confucianism, and later by abandoning the entire Confucian framework. Their primary goal was to explore the nature of virtue and commerce, and justify their own place in the world. As a side effect, the marriage of virtue to commerce allowed a nexus of long-term relationships to arise, based in Osaka.

6. Review of Amitava Krishna Dutt and Benjamin Radcliff (eds.), Happiness, Economics and Politics. Towards a Multi-Disciplinary Approach, Edward Elgar Publishing, 2009, 362 pp.

Elena Nicolae.

7. Review of Abhijit Banerjee and Esther Duflo, Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty, Public Affairs, 2012, 303 pp.

Hannah Cockrell.

8. Review of Joseph Stiglitz, Freefall: America, Free Markets, and the Sinking of the World Economy, W. W. Norton & Company, 2010, 361 pp.

Kathryn Cohen.

9. Review of Eric Helleiner, Stefano Pagliari and Hubert Zimmerman (editors), Global Finance in Crisis: The Politics of International Regulatory Change, Routledge, 2010, pp. 216

Linh Dao.

10. Review of Niall Ferguson, Civilization: The West and the Rest, Allen Lane, Penguin Books, London, 2011, pp. 385

Andrei Josan.

11. Review of Branko Milanovic, The Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality, Basic Books, 2011, 258 pp.

Elizabeth Karin.

12. Review of David Roodman, Due Diligence: An Impertinent Inquiry into Microfinance, Center for Global Development, 2012, 365 pp.

Annie Sholar.

13. Review of Jose Huerta de Soto, The Austrian School. Market Order and Entrepreneurial Creativity, Edward Elgar Publishing, 2011, 129 pp.

Irina Ion.