Modern Monetary Theory: Some Additional Dimensions

Atlantic Economic Journal - The objective of this paper is to examine the foundations of Modern Monetary Theory (MMT) by building upon the individual papers in this issue of the Atlantic Economic...     

Are deviations from purchasing power parity efficient? Some further answers

Zusammenfassung Sind Abweichungen von der Kaufkraftparit?t effizient? Einige zus?tzliche Antworten. - In diesem Aufsatz beschreibt und testet der Autor den Ansatz der effizienten M?rkte für die Kaufkraftparit?t einiger floatender Wechselkurse der Zwischenkriegszeit. Die Ergebnisse sind: (i) Die Abweichungen von der Kaufkraftparit?t in der Zwischenkriegszeit folgen nicht einem einfachen Zufallspfad, sondern eher einem Zufallspfad, der durch einen gleitenden Durchschnitt der Fehler vergangener Perioden modifiziert wird. Letzteres stützt die Ansicht, da\ die realen Zinss?tze nicht konstant sind. (ii) Die Zeitreihendarstellung realer Wechselkurse beinhaltet für zwei Devisenm?rkte, da\ es keine Parit?t gibt, zu der der reale Wechselkurs auf die Dauer hinstrebt. (iii) Best?tigt wurde auch, da\ die Fehler Orthogonalit?tseigenschaften besitzen: Die Ver?nderungen des realen Wechselkurses korrelieren nicht mit der Geldmenge und dem Einkommen im In- und Ausland.

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Resumen ?Son eficientes las desviaciones de la paridad del poder adquisitivo? Algunas respuestas adicionales. - En este trabajo el autor expone y pone a prueba empíricamente el método de mercados eficientes para modelar la PPA aplicado a la experiencia de cambios flexibles durante el período entre las dos guerras. Se concluye que (i) las desviaciones de la PPA entre las dos guerras no responden a un simple ?random walk?, sino más bien a un ?random walk? corregido por un promedio móvil; este último es indicativo de la noción de que las tasas de interés reales no son constantes, (ii) la representación del tipo de cambio real en forma de serie de tiempo implica que, en el caso de dos mercados de divisas, no hay valor de paridad hacia el cual el tipo de cambio real pueda tender a largo plazo, (iii) se ha encontrado evidencia en favor de la propiedad ortogonal de error; quedó demostrado que las variaciones del tipo de cambio real no están correladas ni con la oferta monetaria ni con el ingreso, tanto nacionales como extranjeros.

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Résumé Les déviations de la parité de pouvoir d’achat sont-elles efficientes? Quelques réponses additionnelles. - Dans cet article l’auteur a introduit et testé l’approche des marchés efficients de modeler PPA pour l’expérience inter-guerre avec des taux de change flottants. Les résultats sont: (i) Les déviations de la PPA pour la période inter-guerre ne suivent pas une simple voie aléatoire mais une voie aléatoire modifiée par un term d’ajustement moyen mobile. Une telle voie supporte la vue que les taux d’intérêt réels ne sont pas constants. (ii) La représentation des séries chronologiques pour les taux de change réels implique pour deux marchés de change qu’il n’y a pas une valeur de parité approchée à longue échéance par le taux de change réel. (iii) Les analyses supportent aussi la propriété d’orthogonalité des erreurs: les changements du taux de change réel n’étaient pas corrélés avec la monnaie et le revenu locale et étrangère.

     

Farm household economics: Some policy implications for emergent farmers in Southern Africa

Farm household economics recognises the fact that production and consumption decisions are made jointly by small farm (ie surplus‐producing) households. This phenomenon is of particular importance in areas where small farm households predominate.

Most empirical applications of farm household economics have been directed at measuring the effects of price changes on consumption and have relied on the ‘separable’ approach in deriving estimates. This approach assumes that production decisions always precede consumption decisions with farm households treated as profit maximizers in production and utility maximizers in consumption. Results have clearly demonstrated consumption responses smaller than estimates based on consumer theory alone.

Although many researchers regard mathematical programming as a potentially suitable tool for simulating smallholder behaviour, proponents of new household economics would be reluctant to accept any model that does not (a) maximize utility (rather than profit) and (b) capture the ‘profit effect’ which variations in product prices have on the farm household's full‐income constraint. Attempts to include these basic postulates of farm household economics in programming models are in progress.     

Cosmology and economics

Abstract

Economics has become the political magic of the twentieth century, and contention over economic policy is the political lifeblood of the modern state. The glare of publicity highlights the equilibrism of economic policy, leaving in the shade diplomacy and statecraft of former days. There is a consensus in modern society and in the modern state that political debate and economic discussion are two sides of the same coin, and that “economics”, like a second law of nature, sets the limits of the political options. Economic reform, economic adjustment, economic “rescue plans” and so on are synonyms for political strategies. Politics is the management of the “economy”, and at the same time “economics” is the authority to which all appeal as the “necessity”, as the authority that governs and legitimises policy.     

Utility and economics

Summary Although utility has been the central concept in economics, economists have paid relatively little attention to its measurement. Generally, utility is measured indirectly via the revealed preference approach. We discuss problems with this approach and next introduce alternative direct measurement methods. The direct measurement methods are seen to spawn a so-called theory of preference formation, which explains differences in utility functions of different individuals. The similarities of this theory with related theories in sociology and psychology, and various sorts of empirical evidence, are reviewed. The paper concludes with a discussion of the implications of these findings for economic theories.This is a slightly adapted version of my inaugural address at Tilburg University. I thank Tom Wansbeek for his helpful comments.     

The treatment of racial and sexual discrimination in economics journals and economics textbooks: 1972 to 1987

This article examines two decades of scholarly literature on discrimination and two decades of discussion of discrimination in economics textbooks. At first discrimination was taken seriously and policy responses adequate to the problem were advocated. Today this is a minority position. The article first traces the way thatJEL policies concerning indexing and abstracting have contributed to this change. Next textbooks are analyzed to show how this change is manifested in commonly used curricular materials. Finally, political preferences are shown to undergird crucial arguments like those concerning minimum wages. Conclusions linking ideology to research agendas are put forward.     

宪法经济学:一个分析框架

本文以经济学的视角研究宪法,对宪法经济学的基本内容和逻辑结构进行阐述和梳理。本文对宪法的本质、公共选择规则、政府的权力及其约束、言论自由的经济逻辑和宪法与经济增长的关系进行了探讨,揭示了宪法所蕴含的经济结构。