Bolivia’s Institutional Transformation: Contact Zones,Social Movements,and the Emergence of an Ethnic Class Consciousness

Over the past two decades, development economics has experienced a shift in focus from standard neoclassical analysis to institutions. While studying economic institutions is indeed important, evaluating their transformation and embeddedness is equally crucial for understanding and improving human wellbeing, especially in countries where market institutions are not fully developed. With that perspective in mind, we consider the importance of culture in the evolution of institutions in Bolivia by combining the concept of contact zones with old institutional economics (OIE). Contact zones refer to daily interactions in social spaces where culture and class meet and negotiate with each other. The contact zone between Bolivians and post-WWII development policies surfaced as an Andean collective memory, allowing for a possibility of social and political autonomy through the creation of an alternative to development, El Buen Vivir.     

Collective Action,Marx’s Class Theory,and the Union Movement

Research on establishment size-wage effects has consistently shown a positive relationship between the number of employees and workers' wages. While several theories have been offered to explain these outcomes, the use of data with limited employer characteristics make for a dubious connection between theory and results. This study examines the firm size-wage effect using a dataset that captures typical worker demographics, but also contains employer information not typically captured in larger datasets. The results provide strong evidence that these wage effects are the result of several forces, including worker sorting/matching, efficiency wages, internal labor markets, and, to a lesser degree, working conditions.     

Financialization,Class Interests,and Karl Polanyi’s Protective Response

Many observers expected a stronger countermovement against neoliberalism following the Great Recession. This article argues that such a protective response failed to materialize because the financialization process has aligned the preferences of labor and rentier classes. The result has been weaker support in democracies for expansionary monetary and fiscal policies during the early stages of recessions, which further lowers aggregate spending by increasing uncertainty. Thus, reversing the culture of financialization may be a necessary condition for preventing and responding to financial crises.     

Climate Change and the Polanyian Counter-movement: Carbon Markets or Degrowth?

In the midst of a wave of market expansion, carbon markets have been proposed as the best way to address global climate change. While some argue that carbon markets represent a modern example of a Polanyian counter-movement to the environmental crisis, we adopt a structural interpretation of Polanyi to refute this claim. Carbon markets represent a further expansion of markets that fails to address the underlying contradictions related to the commodification of nature. In addition, they increase risks to society and the domination of economic elites. While carbon markets further subject social and ecological relations to market mechanisms, we examine degrowth as a possible response to climate change that prioritises social and environmental goals over economic growth. While degrowth continues to be dismissed as impractical or impossible, a growing number of scholars, scientists and activists argue it is the only way to address global climate change. In contrast to carbon markets, we argue degrowth could represent a genuine Polanyian counter-movement in response to climate change. In addition, degrowth could help all those disenfranchised by market fundamentalism by addressing the triple crises related to the commodification of land, labour and money.     

On the Linkages of the Stock Markets of the NAFTA Countries: Fundamentals or Speculative Bubbles?

We analyze whether the linkages between the stock markets of the NAFTA member countries (Canada, Mexico, and the United States) reflect movements in fundamentals or speculative bubbles. To this end, we estimate a state-space model to decompose the stock market indexes of the three NAFTA member countries into fundamentals and speculative bubbles. We analyze the linkages of the three stock markets by means of cointegration techniques. Evidence of cointegration linkages between fundamentals is stronger than evidence of cointegration linkages between speculative bubbles.     

Transformation or Transmogrification? Ackerman, Hobbes (as in Calvin and Hobbes), and the Puzzle of Changing Constitutional Identity

In this article, I argue that Ackerman's approach to constitutional change is unable to distinguish between changes of degree and changes in kind, or between changes that transform and changes that transmogrify. As a consequence, the model Ackerman proposes fails at its most elemental purpose of illuminating questions of constitutional identity. Transformations fails to tell us who We the People really are or about what we are constituted.     

Regulation or Markets? The Case of Employment Contracts

Regulation of the employment contract is both wide spread anddiverse. The diversity of regulation is surprising because itsuggests that there is little consensus regarding optimal interventioninto the labor market. This paper discusses several economicreasons why it may be efficient for employers and employeesto enter into long term contracts that make employee dismissalexpensive. This analysis suggests that employment contractscan be expected to be complex in practice, and hence can beviewed as part of the technology of exchange. Given that knowledgeof a technology requires skill and know-how, one cannot expectall employee-employer matches to discover and use the most efficientcontract terms possible. It is suggested that the regulationof the employment relationship might be improved with the creationof a market for contracts, similar to the one that currentlyexists in the United States for construction projects.(JEL J300,J410, K310)     

Bureaucrats or Markets in Innovation Policy? – a critique of the entrepreneurial state

The Review of Austrian Economics - This paper takes stock of recent suggestions that the state apparatus is a central and underappreciated actor in the generation, diffusion and exploitation of...     

Why was the euro weak? Markets and policies

Against all odds, the euro turned out to be a weak currency. We argue that this outcome can readily be explained by the policy-mix that was chosen at the onset of the period: tight fiscal policies following the convergence mechanism that was imposed by the Maastricht treaty and loose monetary policy that resulted from the convergence of interest rates to the lower point of the spectrum. We investigate this outcome empirically and show that the euro's weakness can be understood as the result of an excess supply in the zone, which is channelled abroad in the usual beggar my neighbor way.     

Class or caste? A study on the role of caste and wealth status in school choice decision

There is a strong political opinion in India in favour of replacing caste based affirmative action with an economic class based one. We contribute to this debate by looking at the interaction of caste and wealth in school choice. We show that too rich and too poor parents behave in the same way irrespective of their caste identities—rich parents sending their children to private schools while poor parents choosing public schools for their children. The caste identity, we find, plays a role for the school choice decision made by the parents belonging to the economic middle class. Among the economic middle class parents, the ones from the privileged castes send their children to private schools, while the children of the parents from the disadvantaged castes are sent to public schools. The result is robust to alternative definitions of privileged and disadvantaged castes. For school quality choice, however, we find a monotonic relationship between wealth and school quality.     

Why Punish? Social reciprocity and the enforcement of prosocial norms

Recently economists have become interested in why people who face social dilemmas in the experimental lab use the seemingly incredible threat of punishment to deter free riding. Three theories with evolutionary microfoundations have been developed to explain punishment. We survey these theories and use behavioral data from surveys and experiments to show that the theory called social reciprocity in which people punish norm violators indiscriminately explains punishment best.JEL Classification: C91, C92, D64, H41 Correspondence to: Jeffrey P. CarpenterWe thank Carolyn Craven, Corinna Noelke and two referees for comments, and Middlebury College for financial assistance. In addition, Carpenter acknowledges the support of the National Science Foundation (SES-CAREER 0092953).     

Friend or foe? Social ties in bribery and corruption

Experimental Economics - This paper studies how social ties interact with bribery and corruption. In the laboratory, subjects are in triads where two ‘performers’ individually complete...     

Militarism,Realism, Just War,or Nonviolence? Critical Geopolitics and the Problem of Normativity

Despite illuminating multiple modalities by which armed conflict is discursively justified, critical geopolitics can be criticised for providing a weak normative engagement with the social institution and practices of warfare. This has limited the impact of this school of thought outside of geography and critical security studies at a time when the ethics of military intervention have been prominent in public debate. This article explores the moral discourse of critical geopolitics through an examination of Gerard Toal's writings on Iraq and Bosnia. This scholarship is reviewed in the light of Coates's typology of major traditions of moral reflection on war – militarism, realism, just war theory, and pacifism/nonviolence. This analysis interrogates Toal's narratives, in which American military intervention was advocated in the Former Yugoslavia and opposed in Iraq. This suggests that rather than a thoroughgoing commitment to pacifism/nonviolence, or a blanket cynicism about American foreign policy, Toal's thinking includes an underlying attachment to some form of just war reasoning. However, its implicit and partial appropriation leads to a certain incoherence and selectivity that calls for further reflection. This presents a challenge to critical geopolitics. If it chooses to engage more explicitly with just war theory, its insights into identity and militarism could in turn inform a reworking of aspects of the theory, thereby facilitating critical geopolitics' engagement with wider public anti-militaristic modes of discourse. However, as this risks blunting the political potential of the project and repeating the mistakes of twentieth-century geopolitical thought, the paper concludes with a call for a wholehearted commitment to nonviolence.     

Social economy and employment – the case of Sweden

Recent research has shown growing shares of employment in the social economy (or non-profit sector) both in the European Union and in the United States. In the EU, there seems to be growing hopes that the social economy will be capable of contributing to local progress on the unemployment issue in crisis regions. This paper analyses employment in certain entrepreneurial forms, usually considered belonging to the social economy, in Sweden during the 1990s. The results show considerable regional differences of employment in the social economy, but also that its share of the labor market is very limited. The effect of social-economic organizations on employment, therefore, is probably mainly indirect in as much as they function as platforms for cooperation between firms or else as embryos for enterprises by strengthening local entrepreneurship and helping to nurture a deposit of social capital which has visible effects on private business and jobs. However, these effects need more detailed examinations.     

James Steuart and the making of Karl Marx’s monetary thought

Abstract

This paper analyses the influence of James Steuart on Karl Marx’s monetary thought. It deals more specifically with Marx’s rejection of an automatic mechanism that links variations in the quantity of money to their direct impact on prices. Steuart’s pioneering discoveries in economics inaugurate an anti-quantity theory tradition that Marx supported and which fed his own conception of money and credit. Here, we deal with the criticism of the assumptions of the quantity theory of money (QTM), the specifically social character of labour which creates exchange value, the distinction between the functions of money, the difference between income spending and capital advances, and the difference between simple circulation and reflux of money credit.     

On the Theory of Harmonious Co-existence between Man and Nature by Marx and Engels

Marx and Engles believed that man and nature develop harmoniously, when the activities of man constitute the content of nature, which is changed constantly because of the activities of man. Marx and Engles also pointed out the duarity of the conquest, change and influence exerted on nature by man. On one hand, it can improve people‘s riving conditions and make people free from the enslavement of the nature. On the other hand,it may also lead to excessively snatching and wrecking nature, then make the deterioration of the environment and ecology out of balance. They also, from the technical angle of ecology, put forward the concrete measures to realize the harmonious symbiosis of man and nature in the development of economy. They also believed that only when socialism or communism is realized, can the conciliation of mankind and nature be realized finally.Marx and Engle‘s theory of harmonious symbiosis of man and nature is of great theoretical directive significance for us to insist on the scientific development view.     

Neoliberalism in the Laboratory? Experimental Economics on Markets and their Limits

Experimental economics is now part of mainstream economics and is fast becoming one of its most influential methods. Drawing on the distinction between market and behavioural experimentation, this article assesses the compatibility of the most influential experimental research with the neoliberal understanding of the political and moral preconditions for markets to develop. A politically relevant asymmetry at the core of this research programme will be signalled: while issues of political economy are eschewed by market experimenters (for example, whose interests are favoured and whose groups have power in economic processes), topics of moral economy are recognised and dealt with by behavioural experimenters (for example, the interactions between economic institutions and individuals' motivations and moral make-up). It is argued that experimental research has thereby contributed to a depoliticised and moralised view of markets, one that tends to present markets as a civilising institution once their technical and moral failures are recognised and adequately dealt with.     

Room to Manoeuvre? International Financial Markets and the National Tax State

Globalisation has triggered a downwards trend in direct taxation as governments compete for internationally mobile capital. This popular postulation has blurred the attention to potential upward constraints on tax policy-making emanating from globalised capital markets. In this paper, we illustrate when and how capital markets exert an upward pressure on taxes. While the increasing access to international capital allowed governments in developed democracies to indulge their voters with deficit-financed spending, the most recent crisis has shown that this is no panacea. When international loans become costly, governments have to revert to raising revenue domestically. Using comparative time-series data since the 1980s, we investigate how rising bond yields affect the number and the direction of tax reforms, as well as the tax mix in the OECD. The empirical analysis provides some evidence that international capital markets place an upward pressure on taxes, recently above all on consumption taxes. Yet, governments have also retained room to manoeuvre as a number of tax decisions are more dependent on domestic political factors than on pressure from the capital markets.