The elementary economics of social dilemmas

Abstract.  A social dilemma is, in essence, a prisoners' dilemma in a continuous strategy space. I discuss a number of social dilemmas that have caught my attention, offer an elementary, diagrammatic synthesis of them, and discuss some of the economic insights that the diagrams capture, including incentives for pre‐commitment. Finally, I model pre‐commitment via delegation and link results to the literature on the evolution of preferences.     

The new institutional economics and its relevance to social economics

There has been a quiet revolution in economic theory, led by the New Institutionalists. Pioneered by Douglass C. North, this group argues that institutions are the main determinants of economic performance, yet neoclassical economics has no role for institutions. Contrary to many misconceptions, this theory of institutions can be integrated with neoclassical economics, leaving mainstream economic theory in tact, but broader and more relevant. The purpose of this article is twofold. First, the main arguments of the New Institutionalists are summarized. Second, the bridge between institutions and social economics is explored. The article concludes by arguing that the New Institutional approach is fruitful, and that the theory will gradually be integrated with neoclassical economics, until the two merge into a single body of theory.     

The impact of job security on job satisfaction in economic contractions versus expansions

Job security, often measured using the perceived risk of job loss in the near future, is a significant determinant of job satisfaction. We posit that the impact job security has on job satisfaction is not only a function of how likely it is that a worker loses a job but also how likely it is that a worker could find another. The effect this has on worker job satisfaction then is different depending on whether perceived job loss occurs (or not) when job openings are scarce or when job openings are plentiful. We use difference-in-differences analysis of the 1997 and 2008 waves from the National Study of the Changing Workforce to show that three measures of job security increase private sector worker job satisfaction, and reduce worker incentives to quit, more when job openings are relatively scarce (during contractions) than when job openings are relatively plentiful (during expansions). We find that our results are strongest among less-educated workers.     

Can neoclassical economics become social economics?

This essay has both a general and a specific purpose. Its general purpose is to pose the question: Can neoclassical economics be social economics? Its answer to this general question is: Yes, but only if it abandons its methodological soul; that is, by abandoning methodological individualism, positivism, and ahistoricism, and expressly and systematically adopting a methodological perspective which is holistic, normative, and historical. Its specific purpose is to identify and examine the major elements in the economics of one leading figure in the historical development of neoclassical economics who self-consciously attempted to combine, to paraphrase Schumpeter, a neoclassical head with a social economics heart: Alfred Marshall.     

The basic income guarantee and social economics

This article introduces the Review of Social Economy symposium on the basic income guarantee (BIG). It argues that there are several ways in which the BIG is consistent with social economics. First, the BIG is an attempt to meet the minimum material needs of US citizens and contribute to the common good. Second, important arguments for a BIG move beyond the positive-normative dichotomy. Finally, the BIG would help individuals function as social citizens.     

The status of economics as a naturalistic social science

Naturalistic social science is held frequently to be the mosteffective means of discovering social reality (e.g., Kincaid,H. 1996. Philosophical Foundations of the Social Sciences: AnalyzingControversies in Social Research, Cambridge, Cambridge UniversityPress; McIntyre, L. 1996. Laws and Explanation in the SocialSciences, Boulder, CO, Westview). This paper evaluates economicsas such a science. From Kincaid (1996), criteria for naturalismin social science are identified. The focus here is whetherrational, objective empirical methods exist for choosing economictheories; whether fair, cross and independent tests exist fortheories, assumptions and methodological norms; and whethereconomic theories chosen in these ways have public policy relevance.Examples from economics are related to each of these naturalisticcriteria. These encompass the relevance of econometrics to testingeconomic theories, the complications the non-natural-kind qualityof economic variables impose on testing, and the question ofwhether naturalistic methods reveal economic reality. The paperconcludes that the practice of economics does not, and is notable to, rely on naturalistic methods.     

Social capital and social economics

The “discovery” of social capital in the early 1990s led to an upsurge of research into the economic impact of social cohesion and governmental effectiveness. This paper outlines key developments in the social capital literature over the past 13 years. It then examines theory and evidence of the links between social cohesion, quality of governance, economic performance and human welfare. The literature indicates that social capital makes a measurable contribution to economic development and overall wellbeing, particularly in developing countries. Partly in response to this emerging body of evidence, there has been increased interest in the application of community development principles to economic development initiatives. This paper argues that the advent of social capital theory represents a partial convergence between social economics and mainstream economics, and signifies an increased acceptance that economic activity cannot be meaningfully “disembedded” from social and political context.     

Social capital and social economics

The “discovery” of social capital in the early 1990s led to an upsurge of research into the economic impact of social cohesion and governmental effectiveness. This paper outlines key developments in the social capital literature over the past 13 years. It then examines theory and evidence of the links between social cohesion, quality of governance, economic performance and human welfare. The literature indicates that social capital makes a measurable contribution to economic development and overall wellbeing, particularly in developing countries. Partly in response to this emerging body of evidence, there has been increased interest in the application of community development principles to economic development initiatives. This paper argues that the advent of social capital theory represents a partial convergence between social economics and mainstream economics, and signifies an increased acceptance that economic activity cannot be meaningfully “disembedded” from social and political context.     

Kantian dignity and social economics

Many social economists endorse the ethics of Immanuel Kant, specifically his emphasis on the dignity of humanity and the equal respect due all persons. Based on these tenets, Kant mandates a social outlook in which concern for others, characterized by negative duties of respect and positive duties of beneficence, are broadly required of all rational agents. However, some of the positions that social economists derive from Kantian dignity actually violate it, such as support for a welfare state and opposition to the institution of wage employment. I will show that both of these positions are inconsistent with the traditional understanding of Kantian dignity, suggesting that social economists should either ground their positions on a different concept of dignity, or revise them to remain consistent with Kant's specific sense of dignity. For helpful comments and criticism I thank John Davis, Charles Wilber, David Ellerman, and the rest of the participants in the “Economic Philosophy and Theories of Justice” session at the 2003 meetings of the Association for Social Economics, as well as two anonymous referees. All remaining errors are my own.     

Retailing public goods: The economics of corporate social responsibility

This paper explores the feasibility and desirability of Corporate Social Responsibility (CSR). We identify CSR with creation of public goods or curtailment of public bads. Using a model with profit-maximizing firms, the paper shows that there is a direct parallel between CSR and traditional models of private provision of public goods. Indeed, firms that use CSR will produce public goods at exactly the same level as predicted by the standard voluntary contribution equilibrium for public goods. We compare CSR with government provision and charitable provision, discussing when CSR by private for-profit firms could have a comparative advantage in dealing with public goods provision.     

Barbara Wooteen's lament for economics and vision of a social economics

The British social economist Barbara Wootton (1897–1988), engaged in a searching critique of the narrowness and abstraction of Neoclassical orthodoxy in herLament for Economics (1938), which was provoked by Robbins'Essay on the Nature and Significance of Economic Science, and in her reply to Hayek'sThe Road to Serfdom. Her participation in Beveridge's wartime “brains trust” resulted in her Fabian Society pamphlet,Full Employment (1943). This paper examines Wootton's critique of Neoclassical Economics; her vision of a broader, more realistic social economics; her attempts to apply that vision of social economics inThe Social Foundations of Wages Policy (1955), andIncomes Policy (1974), and parallels between her work and North American developments in social economics. *** DIRECT SUPPORT *** A03DH034 00003     

The extension of social security coverage in developing countries

We study the dynamic general equilibrium effects of introducing a social pension program to elderly informal sector workers in developing countries who lack formal risk sharing mechanisms against income and longevity risks. To this end, we formulate a stochastic dynamic general equilibrium model that incorporates defining features of developing countries: a large informal sector, private transfers as an informal safety net, and a non-universal social security system. We find that the extension of retirement benefits to informal sector workers results in efficiency losses due to adverse effects on capital accumulation and the allocation of resources across formal and informal sectors. Despite these losses recipients of social pensions experience welfare gains as the positive insurance effects attributed to the extension of a social insurance system dominate. The welfare gains crucially depend on the skill distribution, private intra-family transfers and the specific tax used to finance the expansion.     

辽宁省社会保障水平的国内比较

社会保障水平是反映一个国家或地区经济发展和人们生活水平的一个重要指标,根据辽宁省近五年来社会保障支出的数据,分析计算辽宁省社会保障水平,并与国内若干省市的社会保障水平进行了比较,进而分析辽宁省的社会保障发展状况,以及与其他省市社会保障水平比较中反映出的若干问题,从而对辽宁省的社会保障水平做出总体性评价。     

浅析新农村的社会保障问题

社会保障是构建社会主义和谐社会的一项基础性制度建设,对调节收入分配、促进社会公平具有重要作用.本文从理论和实践的结合上,剖析了当前我国新农村建设中社会保障方面存在的根本性问题,同时对建设和完善符合我国国情的农村社会保障体系的发展思路进行了探讨.     

浅析新农村的社会保障问题

社会保障是构建社会主义和谐社会的一项基础性制度建设,对调节收入分配、促进社会公平具有重要作用。本文从理论和实践的结合上,剖析了当前我国新农村建设中社会保障方面存在的根本性问题,同时对建设和完善符合我国国情的农村社会保障体系的发展思路进行了探讨。