Keynes on the nature of capital: a note on the origin of The General Theory's chapter 16

In The General Theory, unlike Keynes's previous works, we find a chapter explicitly devoted to a discussion of capital. It's title, however, does not accurately reflect the actual content of the chapter itself; and the text, which contains a discussion of the concept of roundaboutness, may leave the reader uncertain about Keynes' attitude towards that concept and on the actual focus of the chapter. In this paper a study of the surviving drafts of The General Theory and of other sources relevant to the purpose of elucidating the process of composition of the chapter allows us to show how and why those peculiarities emerged and helps to cast light on their meaning.     

Don Patinkin and the origins of postwar monetary orthodoxy

Don Patinkin's Money, Interest, and Prices (1956) set the ground rules of postwar monetary discourse, for better or worse. A close look at the intellectual origins of the book in Patinkin's own life shows it to emerge equally from the Old Chicago School of Simons/Mints/Knight and the Cowles Commission of Lange/Marschak/Haavelmo. Patinkin's conception of money as essentially an outside asset is argued to emerge from the historical context of war finance, and is contrasted with the Gurley-Shaw conception of money as a form of inside credit.     

Visible and invisible order. The theoretical duality of Smith's political economy

The aim of the paper is to show that Adam Smith elaborated a distinctive image of nature related to economic discourse. In Smith, visible events (or interdependencies) must be connected to invisible principles which, in particular, should provide an explanation of the self-coordination processes (especially that of market). In a broad sense, this approach was adopted by a number of disciplines in Smith's time (especially the sciences of life), which focused the analysis of the organization of complex systems. Moreover, the conceptual pair (visibility and invisibility) is connoted in terms of theoretical duality, and the paper attempts to demonstrate how such duality is reproduced in Smith's economic categories.     

Ellerman's Labor Theory of Property and the Injustice of Capitalist Exploitation

The traditional Marxian arguments for the injustice of capitalist exploitation generally focus on the ownership patterns of productive property. Exploitation is thus viewed either as the result of illegitimate private ownership or as the result of the unequal distribution of productive assets. This paper seeks to contribute a different perspective on the injustice of exploitation. It argues that exploitation violates principles of appropriative and contractual justice, rather than distributive justice. To make this case, the paper shows how Ellerman's labor theory of property might be combined with Resnick and Wolff's Marxian theory of exploitation and enriched by Nussbaum's interpretation of Aristotelian moral theory to challenge the justice of the wage-for-labor-time exchange, without making reference to the existence or distribution of private property.     

Announcement

The paper focuses on Blaug's distinction between rational and historical reconstruction within the historiography of economics. Blaug's distinction is shown to be sterile and misleading and his definitions of no avail to clear thinking. Historical reconstruction (as defined by Blaug) is en empty box for reasons which are basically theoretical and not simply practical (as Blaug seems to hold). Moreover, Blaug's primary polemical target is Whig historiography and not rational reconstruction: the two concepts coincide only by means of an ad hoc definition. Blaug's criticism does not apply to other uses of the concept of rational reconstruction such as that proposed by Lakatos.     

Existence of Nash equilibria in finite extensive form games with imperfect recall: A counterexample

This paper provides an example showing that for finite extensive form games without perfect recall existence of Nash equilibria in behaviour strategies is not guaranteed in general.     

Existence,uniqueness, and stability of equilibrium in an OLG economy

Summary. This paper presents sufficient conditions for the existence of a unique and globally stable steady state equilibrium for OLG economies with production. The conditions impose separate requirements on the utility and production functions. Moreover, the conditions do not require assumptions concerning the third order derivatives of the production and utility functions.Received: 12 August 2002, Revised: 7 January 2003, JEL Classification Numbers: D50, D91, E13, O41.I would like to thank Nick Baigent, Laurie Conway, Karl Farmer, Christian Gehrke, and Hideo Konishi for helpful comments. I am grateful to an anonymous referee for his or her comments.     

Böhm-Bawerk,Jevons and the 'Austrian' theory of capital: 'a quite different relation'

The paper examines the relationship between the interest theories of Jevons and Böhm-Bawerk. Although their results can easily be reconciled mathematically, Böhm-Bawerk's ‘misunderstanding’ of the Jevonian formula reveals a fundamental difference concerning their derivation. Despite their formal similarity, the two models exhibit a different conceptual architecture and thus also attach quite different meanings to the concept of the interest rate. Rather than trying to reconcile them, the paper suggests to analyse their relationship as part of an entire transformation, which can be equally traced between the value and price theories of the two authors.     

The valuation of unpaid work at statistics Canada

In 1970, as in previous decades, the U.S. Bureau of the Census's household enumeration began with a lead question as to who was the 'head of household'. With the resurgence of feminism, this concept was challenged as an ambiguous concept which implied an authority structure imputed by the Bureau not measured, and offensive to many people. This paper tells the story of successful feminist mobilization in the 1970s that led to the removal of this concept from the U.S. decennial censuses beginning with 1980.     

ECONOMIES OF SCALE AND SCOPE IN POSTAL OUTLETS UNDER CONSIDERATION OF UNOBSERVED HETEROGENEITY

ABSTRACT: We analyze economies of scale and scope in Swiss Post's post offices and franchised postal agencies under consideration of different underlying production technologies and unobserved factors using a latent class model. The results confirm the existence of unobserved heterogeneity and of increasing economies of scale and scope in the Swiss Post's outlet network.     

Open core and quasi-equilibria with lower semi-continuous preferences

Summary. This note introduces a new concept of core –open core, using which it shows a quasi-equilibrium existence result in an economy where consumers' preference relations are assumed to be lower semi-continuous, but not necessarily to have open lower sections nor to be open valued, such as the lexicographic ordering. As an application, a competitive equilibrium existence result without non-satiation assumption is proved. Received: October 28, 1996; revised version: November 4, 1997     

Equilibria in rent-seeking contests with homogeneous success functions

Summary. We characterize pure-strategy Nash equilibria for symmetric rent-seeking contests in which the contest success function is homogeneous of degree zero. The equilibrium strategies have a simple form. We give sufficient conditions for existence of an equilibrium.Received: 11 February 2003, Revised: 27 August 2004, JEL Classification Numbers: D72. Correspondence to: Andrew J. YatesWe thank Douglas Nelson, Jac Heckelman, and two anonymous referees for helpful comments.     

A Model of Commodity Differentiation with Indivisibilities and Production

This paper presents an existence theorem in a general equilibrium model of a production economy with commodity differentiation and indivisibilities. The model is motivated by the existence of markets with indivisible commodities, such as the markets for automobiles and computers. As is standard in the literature, the space of commodity characteristics is described by a compact metric space and a commodity vector is described by an integer-valued Borel measure on the space of commodity characteristics. An atomless measure space of producers and consumers is assumed to overcome the problem of non-convexity of the production and consumption sets induced by indivisibilities. This paper is based on a chapter from James Marton’s dissertation. We would like to thank Marcus Berliant, Wilhelm Neuefeind, and an anonymous referee for their valuable comments and suggestions.     

Heinrich von Stackelberg on joint production

In the 1970s, considerable interest arose into the study of multi-output firms and industries. However, this literature did not seem to be aware of the contribution that von Stackelberg made to the issue almost half a century earlier. This paper outlines von Stackelberg's contribution to the theory of costs under joint production. It critically assesses the place of his contribution in the modern history of the theory of joint production and it suggests an answer to the question of why von Stackelberg's theory of joint production fell into oblivion and even contributed to the abandonment of the issue for decades.     

"Thank God . . . I Thought for a Moment You Were Going to Confess to Converting to Socialism!": Gender and Identity in Deirdre McCLoskey's Crossing

"Thank God . . . I thought for moment you were going to confess to converting to socialism! 'critiques McCloskey's account of her transition from a heterosexual male professor of "Chicago school" economics to a female, "free-market feminist." McCloskey's account raises fascinating questions for all feminists regarding both one's definitions of gender, and the institutions and practices which reinforce gender boundaries. At the same time, McCloskey's account is found to be lacking in certain respects. For example, she pays insufficient attention to the implications of gender for rational-choice, free-market economic theories, and she insufficiently contextualizes her definitions of masculinity/femininity to a particular class and race in the late 20th century US.     

On exogenous money and bank behaviour: the Pandora's box kept shut in Keynes' theory of liquidity preference?

This essay examines Keynes' views on banking behaviour and the relationships between central banks and banks as they evolved from his Tract on Monetary Reform to The General Theory. The objective is to clarify in what sense money may be exogenous in his final work. We identify a distinctly Keynesian position on the money-supply process, featuring money exogeneity due to bank behaviour. Our findings run counter to both neoclassical synthesis view on exogenous money cum passive banks as well as the post Keynesian challenge of endogenous money cum passive banks.     

Globalization,Gender And The Davos Man

Using Karl Polanyi's analysis of the social construction of markets in nineteenth- and early twentieth-century Europe, the paper applies his analysis to the formation of global markets in the late twentieth century. The paper argues that Polanyi's work needs to be engendered in order to take into consideration women's and men's different links to the market and to understand the construction of "economic man" gone global. The paper also addresses the feminization of the labor force across the globe and the possible effects on women's behavior and on the construction of "economic woman." The concluding section discusses alternative interpretations of this behavior.     

DO GAMBLERS THINK THAT TEAMS TANK? EVIDENCE FROM THE NBA

A growing body of literature indicates that sports teams face incentives to lose games at the end of the season. This incentive arises from a league's entry draft policy. We use data from betting markets to confirm the existence of tanking, or the perception of tanking, in the National Basketball Association (NBA). Results from a Seemingly Unrelated Regression (SUR) model of point spreads and point differences in NBA games indicate that betting markets believe that tanking takes place in the NBA, even though the evidence that tanking actually exists is mixed. Other NBA policy changes also affect betting market outcomes. (JEL D0, L0)     

Catalog competition and Nash equilibrium in nonlinear pricing games

We model strategic competition in a market with asymmetric information as a noncooperative game in which each seller competes for a buyer of unknown type by offering the buyer a catalog of products and prices. We call this game a catalog game. Our main objective is to show that catalog games have Nash equilibria. The Nash existence problem for catalog games is particularly contentious due to payoff discontinuities caused by tie-breaking. We make three contributions. First, we establish under very mild conditions on primitives that no matter what the tie-breaking rule, catalog games are uniformly payoff secure, and therefore have mixed extensions which are payoff secure. Second, we show that if the tie-breaking rule awards the sale to firms which value it most (i.e., breaks ties in favor of firms which stand to make the highest profit), then firm profits are reciprocally upper semicontinuous (i.e., the mixed catalog game is reciprocally upper semincontinuous). This in turn implies that the mixed catalog game satisfies Reny’s condition of better-reply security—a condition sufficient for existence (Reny in Econometrica 67:1029–1056, 1999). Third, we show by example that if the tie-breaking rule does not award the sale to firms which value it most (for example, if ties are broken randomly with equal probability), then the catalog game has no Nash equilibrium. This paper was written while the second author was Visiting Professor, Centre d’Economie de la Sorbonne, Universite Paris 1, Pantheon-Sorbonne. The second author thanks CES and Paris 1, and in particular, Bernard Cornet and Cuong Le Van for their support and hospitality. The second author also thanks the C&BA and EFLS at the University of Alabama for financial support. Both authors are grateful to Monique Florenzano and to participants in the April 2006 Paris 1 NSF/NBER Decentralization Conference for many helpful comments on an earlier version of the paper. Finally, both authors are especially grateful to an anonymous referee whose thoughtful comments led to substantial improvements in the paper. Monteiro acknowleges the financial support of Capes-Cofecub 468/04.     

Patinkin as a reader of Keynes’ General Theory: Are wage cuts a good remedy to unemployment?1

Abstract

This paper analyses Patinkin's appraisal of Keynes’ concept of involuntary unemployment while focusing on his reading of the General Theory Chapter 19. On several critical issues, Patinkin departs from Keynes’ original matters of concerns. He leans against an individual criterion for unemployment and implicitly endorses Wicksell's understanding of voluntary unemployment as chosen leisure. His appraisal of involuntary unemployment as a disequilibrium phenomenon ultimately relies on nominal rigidities and assumes the existence of a competitive adjustment process. On all these three critical points, Patinkin departs from Keynes but also initiates the contemporary New Keynesian programme that went even further from Keynes.