The mobility of highly skilled human capital in Taiwan

Most economists agree that a country's economic growth depends on human capital, physical capital, technology, and several other minor inputs. Human capital is the basic wealth of every country. Highly skilled workers are the most important component of human capital. Human capital can have a positive spillover effect on society. When talented young people leave their native country to work elsewhere, this brain drain inhibits the country's economic growth. Several factors contribute to brain drain. These can be classified roughly into three categories: economic, academic and personal. Economic factors play the most important role. From the early 1960s to the late 1980s, Taiwan suffered a brain drain when many people who had earned advanced degrees in western countries chose to leave Taiwan to work elsewhere. In this study's statistical analysis, I show that Taiwan's economy is based in past on an effective labour force and explain why Taiwan's economy has grown over the past 30 years. With the improved economy in the 1990s, young people are increasingly choosing to return to or remain in Taiwan to work and live. As Taiwan's economy improves, its highly skilled labour market becomes more competitive.     

An Archaeology of Adam Smith's Epistemic Context

Abstract

Adam Smith played a key role in Foucault's archaeology of political economy. This archaeology, which Foucault accomplished in The Order of Things, is the focus of this article. Foucault may have disagreed with the writings of the classical political economists but he widens our perspective through new possibilities of understanding. It is very illuminating to understand Smith's thinking as following a discursive practice that economic thought shared with the knowledge of living beings (natural history) and language (grammar). Foucault's archaeology highlights some ontological and epistemological conditions that shed light on some of the pillars of Smith's thinking: the centrality of exchange, the division of labour and the labour theory of value. The proximity between Newton and Smith is also examined in ontological and epistemological terms which can be understood through an investigation of that interdiscursivity practice. Beyond testing Foucault's considerations, our aim is to demonstrate their potential for the current scholarship of Smith's works. Foucault's archaeology of knowledge offers a range of elements that warrants greater analysis by historians of economic thought.     

Religion and the sociological critique of political economy: Altruism and gift

Abstract

This article shows that there is a strong connection between the religious component of French sociology and the critique of political economy. In the first section, I consider how selfish behaviour, or egoism, became treated as a major threat endangering the creation of industrial society by those concerned about the diffusion of political economy. I then summarise the methodological critique set forth in the Cours, before connecting this critique to the economic content of the Système and the concept of altruism. In the following section, Spencer's view of altruism is contrasted to that held by Comte, and then I consider the reaction of French political economists, defending the moral value bought about by their science. In the final section, I explain how the Comtean approach was re-enacted by Durkheim and then by Mauss, at the head of the “sociology of religion” section of L'Année sociologique, the Durkheimian journal, to give birth to the theory of gift-giving behaviour that Mauss used to critique political economy in the 1920s.     

Aristotle vs. Plato: The classical origins of capitalist & socialist political economies*

Competing definitions of justice in Plato's Republic and Aristotle's Politics indicate the existence of two distinct economic systems with different priorities. The three-class society of the Platonic economy (guardians, auxiliaries, producers) gives rise to guardians who by virtue are expected to enforce output targets on producers directly or through auxiliaries. The three-class society of the Aristotelian economy (rich, middle, poor) facilitates the emergence of different ruling coalitions and compensates the efficiency losses of central planning with political gains derived from representative governance. In the Aristotelian economy, the middle class is better off than in the Platonic economy (auxiliaries), because a just society (polity) is achieved under its coalition with the rich. I argue that the equilibrium solutions of the Platonic and Aristotelian economic systems provide analytical insights on the origins of capitalist and socialist political economies.     

The Emergence of the Law of Value in a Dynamic Simple Commodity Economy

Abstract

A dynamic computational model of a simple commodity economy is examined and a theory of the relationship between commodity values, market prices and the efficient division of social labour is developed. The main conclusions are: (i) the labour value of a commodity is an attractor for its market price; (ii) market prices are error signals that function to allocate the available social labour between sectors of production; and (iii) the tendency of prices to approach labour values is the monetary expression of the tendency of a simple commodity economy to allocate social labour efficiently. The model demonstrates that, in the special case of simple commodity production, Marx's law of value can naturally emerge from multiple local exchanges and operate ‘behind the backs’ of actors solely via money flows that place budget constraints on their local evaluations of commodity prices, which are otherwise subjective and unconstrained.     

Labour Unrest in the Global Political Economy: The Case of China's 2010 Strike Wave

This paper argues that whilst the relationship between US consumerism and China's low-wage production has underpinned China's economic growth in recent years, policy-makers are increasingly cognisant of heightened internal and external vulnerabilities, namely increased domestic social unrest and downturns in US demand. Despite calls for increased domestic consumption, opinion remains divided as to the extent to which policy-makers will make a genuine departure with China's export-orientation. This paper argues, however, that the direction of the Chinese political economy will depend much on the transformative role of workers’ struggles. Placed in a broader north-east Asian comparative perspective, we argue that China appears to be on the verge of a transition towards a limited labour supply, as evidenced in increasing labour shortages, rising wages costs and new forms of labour unrest. An in-depth case study of the strike at Nanhai Honda in 2010 suggests that China's migrant workers are beginning to develop a class consciousness and move from reactive to proactive demands. Furthermore, the response of the Chinese state and employers has shifted from one of outright repression to one of accommodation. These trends are likely to be highly significant in terms of China's uneven integration into the global economy.     

Thoreau's economic philosophy

Abstract

This paper provides an encompassing portrayal of Thoreau's economic thought. It is analyzed against the background of the history of economic thought and the economic thinking of his time. Thoreau's economic thought is an extensive examination of the ideas of classical political economy, and particularly of Jean-Baptiste Say, and it is a fundamental critique thereof. Thoreau recognizes that some aspects and foundations of the modern conception of the economy lead to an alienation of the human being from itself as well as to an alienation from nature. I demonstrate that this critique is a result of Thoreau's specific approach to the economy, which, based on his particular understanding of the human being and his philosophy of nature, seeks the meaning of the economy for human life and for nature. In this philosophical approach, which I characterize as an economic philosophy, Thoreau's deeper defiance of classical political economy and his original place within the history of economic thought are grounded. It leads Thoreau to an alternative conception of an economy of moderation, which is identified and described in detail. I conclude with considerations on the potential meaning of Thoreau's thought for current economic research.     

New measures of factor productivity in Australia: a Sato approach

This article derives new results of the Elasticity of Substitution (ES) between capital and labour and factor productivity for Australia, an economy which experienced major economic reform that substantially increased the flexibility of its labour, product and capital markets throughout the 1980s and 1990s. It employs a Sato production function specification which has unique properties that enable the estimation of capital–labour substitution elasticity and changing marginal productivities through time. These estimates reveal that the substitution elasticity and labour productivity in Australia rose significantly from the mid-1960s and remained elevated during the economic reform period. A novel contribution of this article is the depiction of Australia's production isoquants to convey how combining labour and capital to produce real Gross Domestic Product (GDP) has changed over recent decades.     

Industrial Relations Reform: Chasing a Pot of Gold at the End of the Rainbow?

This article reviews the economy‐wide effects of the Work Choices and Fair Work reforms to Australia's industrial relations system. Outcomes examined are wages growth and earnings inequality, labour market adjustment, labour productivity growth and industrial disputes. Little evidence is found of an effect from the industrial relations reforms made in the 2000s. I argue that this is consistent with the nature of the reforms, being primarily oriented to distributive rather than efficiency goals. I finish by describing how private interest can explain current lobbying for further reform to Australia's industrial relations system.     

Forget English Freedom,Remember Atlantic Slavery: Common Law,Commercial Law and the Significance of Slavery for Classical Political Economy

Is the liberty to pursue individual self-interest in the capitalist market all that remains of the grand Enlightenment promise of human emancipation? The article addresses this question by returning to eighteenth century scholarship on the relationship between English common law and commercial law. Specifically, I explore the fundamental challenge posed to common law by the regulation, through commercial law, of enslaved Africans as labouring ‘things’. I show how key British scholars in the eighteenth century traditions of jurisprudence, moral philosophy and political economy struggled to address the radical unfreedom of the enslaved and the meaning of her/his radical emancipation. I explore how this Atlantic challenge was ‘indigenised’ to speak to the threat posed by enclosures in Britain, in particular, the possible destruction of the qualified unfreedoms and freedoms extant in the paternal social order upheld by common law. I explore how political economy traditions pre and post abolition and emancipation sought to deal with this challenge. And I conjecture on the significance of remembering the most radical process of commodifying labour – in Aimé Césaire's terms, thingification – for present day interpretations of the relationship between capitalism and freedom.     

Value and Exploitation: A counterfactual approach

A deconstruction of the Marxian theories of value and exploitation is attempted by arguing, first, that the labour theory of value is logically and methodologically inconsistent as a basis for a theory of capitalist exploitation and, second, that it is founded on an ontology of the social being which is not plausibly justified. A counterfactual model economy is then built, called Utopia, in which the workers receive the whole net output while commodities exchange at labour values. This model is used as a benchmark to evaluate a capitalist economy where commodities exchange at production prices and workers are exploited. It is shown that the factor of exploitation can be expressed as a ratio between the labour commanded by, and the labour contained in, the net output, or between the value added produced in a capitalist economy and that produced in Utopia. The resulting theory of exploitation entails a weak ontology of the social being, expressing a worker's point of view.     

Internal R&D effort,external imported technology and economic value added: empirical study of Taiwan's electronic industry

Technology innovation is a significant resource in the contemporary knowledge-based economy. The main sources of technology innovation are internal R&D effort and external imported technology. Two primary traditional production factors are physical capital and labour. The theoretical basis for this study is an evolutionary Cobb–Douglas production function explaining the effects of four resources (internal R&D effort, imported technology, physical capital and labour) on a firm's sales and economic value added (EVA). Time-series cross-section panel data from 219 Taiwan electronic manufacturers between 1990 and 2003 were employed for fixed effect model. Major empirical findings were observed in this study: first, Internal R&D effort can positively affect a firm's sales and EVA. Conversely, imported technology is found to have had no significant effect on sales and EVA. Second, although both physical capital and labour affect a firm's sales more than the effects of internal R&D and external imported technology, internal R&D effort contributes to a firm's EVA beyond the effects of imported technology, physical capital and labour. Third, External imported technology has neither a complementary nor a substitutive relationship with internal R&D effort.     

Family,religion and economic performance: A critique of cultural determinism

Arguing that some attitudes that may constitute an obstacle to the development process are culturally funded, cultural determinism pleads that underdevelopment is essentially generated endogenously, in other words, that people in developing countries, with their beliefs and their attitudes, are the more liable for the poverty in which they live. The simplicity of these arguments has seduced a large number of scholars but what seems to be a cultural brake on economic development could be explained otherwise. This critique of cultural determinism's arguments attempts to supply an alternative version of the interaction of culture and development, from which power, class, domination and the international division of labour will not be excised. In order to simplify this study only two of the cultural features most often referred to will be brought into focus: religion and family and patterns of kinship.     

The ‘Value’ of Europe: The Political Economy of Culture in the European Community

During the 1970s and 1980s the “cultural sector” became one of the primary motors for wealth creation in the European Community. At the European and national scales, a group of actors helped transform Europe's vast array of practices and services (tourism, heritage, books, audio-visual products, etc.) into “cultural industries” and pushed the EC to develop a common cultural policy to support these industries. Documenting these changes at the European scale, I argue that the perceived impact of cultural policy for particular national economic competitiveness was also significant. Italian MEPs and members of Italy's national government were especially important, as they fought to protect the country's historical heritage and promote tourism. France pushed the strongest and I show how that country's efforts were primarily intended to protect its audio-visual and publishing industries from the EC internal market's liberalisation policies, which were vocally supported by Britain because they would have served that county's national economic interests.     

A Reassessment of Marx's Thought on Labour Exchange

This article reassesses Marx's thought on labour exchange and illuminates its worth. In the Grundrisse and subsequent pre-Capital writings, Marx presented arguments that attached importance to worker subjectivity towards labour performance based on the distinction between labour capacity and labour. This afforded insights into the peculiarities of labour exchange that preclude market determination of wages and other working conditions and necessitate the intervention of class struggle and other socio-political factors in their settlement. The significance of Marx's perspective is further elucidated when compared with the classical tradition and the position of neoclassical economics. Although his emphasis on worker autonomy receded in Capital, his earlier arguments on labour exchange, it is posited, remain highly relevant to understanding industrial relations in today's capitalist economy.     

Australian Opportunities through the Chinese Structural Transformation

China is now Australia's largest trading partner, continuing to increase its relative importance. Its growth and structural change have been the major determinants of the conditions under which Australia relates to global markets for goods, services and capital. China has been a labour surplus economy. Over the past half‐dozen years, China has entered the ‘turning point’ in economic development, in which labour becomes scarce, real wages rise rapidly, the surplus of savings over investment falls and there is some easing of growth rates in sectors that use resources intensively. This changes the nature of Australian opportunities in China.     

Sen after Putnam

Modern classical economic theory, originally austere and minimalist (as in Sraffa and Neumann), has entered a second, more enriched phase. Inspired by Adam Smith, Amartya Sen has drawn out the moral implications of formal classical models. But Sen remains open to neoclassical attack on the grounds that science must be value free. In his book The Collapse of the Fact/Value Dichotomy and Other Essays , Hilary Putnam rebuts the view that "fact is fact and value is value and never the twain shall meet". This paper explores consequences of this argument for classical theory. It explains the nature and significance of the entanglement of facts, analysis and values; and the impact of this entanglement on the concept of rationality, on capability theory, on the relationship between human needs and Sraffa basics, on Pasinetti's transformational growth, and on Sen's analysis of the disabled and most wretched. Supporting Sen's approach to human development, it opens the possibility of an enriched classical analysis, which can absorb Martha Nussbaum's analysis of tragedy using a logically and morally coherent political economy.     

Do Workplace Contracts Harm Labour Productivity Growth? A Reconsideration of the Macroeconomic Evidence from New Zealand

This article reconsiders the argument advanced or endorsed by a large number of leading Australian academics and others that labour productivity growth in New Zealand fell markedly during the period in which New Zealand's Employment Contracts Act 1991 (ECA) was operative—that is, for most of the 1990s. On the one hand, based on total economy estimates developed by The Conference Board and the Groningen Growth and Development Centre, labour productivity growth was unexceptional though a little higher than the New Zealand average of the last three decades or so. On the other hand, based on newly released official estimates of New Zealand's ‘measured sector’ (which accounts for about two‐thirds of the total economy), labour productivity growth was almost identical to that of Australia during the EC A period. This in turn suggests that New Zealand's labour productivity growth rose markedly for the measured sector during the EC A years. All in all, the evidence presented in this article is inconsistent with claims that the period of the EC A was associated with relatively weak New Zealand productivity growth. Selected issues arising from these findings are briefly canvassed.     

Funding Pain: Bedouin Women and Political Economy in the Naqab/Negev

ABSTRACT

This contribution focuses on the experiences and voices of Palestinian Bedouin women surviving and challenging Israeli colonial policies while residing in their own land and, in particular, the Bedouin women of the Naqab living in unrecognized villages. Through interviews and focus groups, this study learns from and engages with the voices of Palestinian Bedouin women because colonized women's criticisms of the political economic apparatus are seldom invoked to influence policy. Exploring these women's voices offers an opportunity to examine the political economy of their unrecognized, officially nonexistent villages and homes and to rectify the gap in bottom-up knowledge of political economy by investigating the institutional structures that define and circumscribe women's lives. Privileging Bedouin women's production of knowledge carries the analytical value of studying political economy based on women's own experiences and struggles against hegemony.     

Marx 200: The Abiding Relevance of the Labour Theory of Value

ABSTRACT

Marxist political economy is alive and well, and not just because of the habitual turn to Marx in response to any crisis of capitalism. Both through Capital and through the continuing evolution of Marxism, Marxist political economy offers valuable insights that can illuminate the modalities of social and economic reproduction and the relationships between (different aspects of) the economic and the non-economic. Marxism’s presence has been felt through its own internal debates and debates with other approaches to political economy, and even through its influence on those reacting against Marxism. The key to the continuing relevance and analytical strengths of Marxist political economy lies in its capacity to provide a framework of analysis for unifying disparate insights into and critiques of the contradictions of capitalism across the social sciences. The instrument for forging that unity is Marx’s theory of value, the potential of which is examined and illustrated with reference to the Sraffian critique and two key concepts in Marxian political economy: the value of labour power and financialisation. They are explored in the light of the processes of commodification, commodity form and commodity calculation.