Birth,Death, and Consumption: Overlapping Generations and the Random Walk Hypothesis

This paper studies the time-series behavior of consumption in a model that incorporates birth, death, and a precautionary motive for saving. Consumption of an individual agent is a random walk. However, aggregate consumption is a random walk if and only if the sum of the death rate and population growth rate is zero. Failure of the random walk hypothesis should not be attributed to finite horizons perse, but rather to inter-generational transfers caused by birth and death. Unlike certainty-equivalent models, the expected growth of consumption depends on financial wealth, rather than wage income or human capital. [D91, E21]     

Identification of technological structures using patent statistics

This paper studies the use of patent statistics in identifying four aspects of technological structure, namely, the potential knowledge pool, cumulativeness, inter-firm homogeneity in technology levels, and the scope of innovations. The firms are sampled from the chemical (CHEM), the computer (COM) and the electrical and electronic (EE) industries worldwide. Using the proxies defined, we find that (i) the contributions of intra-industry spillover are low, at 12%, 10%, and 9% for the three industries respectively; (ii) they can internalize 15%, 19% and 13% of their previous research efforts respectively; and (iii) a positive relationship between knowledge spillover and technology overlap, and between scope of innovation and number of patents being cited in future.     

The dynamics of transitions in socio-technical systems: A multi-level analysis of the transition pathway from horse-drawn carriages to automobiles (1860–1930)

This article investigates transitions at the level of societal functions (e.g. transport, communication, housing). Societal functions are fulfilled by socio-technical systems, which consist of a cluster of aligned elements, e.g. artefacts, knowledge, user practices and markets, regulation, cultural meaning, infrastructure, maintenance networks and supply networks. To understand how transitions from one socio-technical system to another come about, the article describes a conceptual multi-level perspective. The perspective is illustrated with a historical case study: the transition from horse-drawn carriages to automobiles in the USA (1860–1930). The case study shows that technological substitution approaches to this transition are too simple, because they neglect the electric tram and bicycle, which acted as important stepping stones. The case study also corrects another mistake, namely that the gasoline car won by chance from steam and electric automobiles. It will be shown that particular niches played a crucial role in this competition, as well as the wider socio-technical context. The case study deviates on three points from the multi-level perspective. These deviations are used to conceptualize a particular transition pathway, called ‘de-alignment and re-alignment’.     

Surplus Value Production and Realization in Marxian Theory – Applications to the U.S., 1990–2015

ABSTRACT

Marx's Capital shows that surplus value can be produced in one industry, yet realized as profit (and possibly revenue) by other industries over the course of circulation. This paper highlights the separation between surplus value production and realization in Marx's work, and develops a new method for estimating surplus value production at the industry level to trace out transfers of surplus value across industries. The framework is based on the ‘New Interpretation’ and links money value added to surplus value production at the industry level. Data on value added by industry for the U.S. are used to estimate surplus value production by industry. The analysis allows comparison of surplus value production and realization in each industry. The pattern of differentials between surplus value creation and realization across industries sheds light on the processes of capitalist competition and points to a source of instability for capitalist economies.     

A Framework for Reconsidering the Lake Wobegon Effect

The Lake Wobegon Effect (LWE) describes the potential measurement-error bias introduced into survey-based analyses of education issues. Although this effect potentially applies to any student-report variable, the systematic overreporting of academic achievements such as grade point average is often of preeminent concern. This concern can be easily circumvented if official records data are available; however, many researchers can only access student-reported data. In this article, the authors examine whether using student-survey data in place of official records data meaningfully biases regression estimates. They motivate their contribution by noting a useful statistical feature of overreporting on bounded variables such as grade point average. Specifically, the misreports will be negatively correlated with the true grade point average, yielding a form of nonclassical measurement error that actually counteracts the bias. The authors connect this observation to reliability ratios used in labor economics, which are simple ways to adjust for attenuation bias, when needed. In two applications, we find that it is unnecessary to correct for the LWE bias because it is so small.     

High School Economics: Problems and Prospects

Asserting that the basic problem in high school economics is that we have not identified “what high school economics ought to be,” Warmke proceeds to spell out some of the specific obstacles hindering the development of more and better secondary level courses. He then discusses some of the more encouraging trends in research, teaching, teacher-training, materials development, and the like, and makes some cautious projections for the future.     

Economic Education Research: Part II,New Directions in Theoretical Model Building

This article on research methodology in economic education is the second in a three-part series. The first, which appeared in the Winter 1983 issue of this Journal, focused on issues and questions economic education researchers should address. The present article provides suggestions for the development of theoretical models in which these issues and questions can be conceptualized, organized, and formally stated as empirically testable hypotheses. The final article will review statistical and econometric techniques appropriate for model estimation and statistical testing of specific hypotheses about teaching methods and other issues related to the production of economic learning.     

The New Economics Tests for the College and Pre-college Levels: A Comment

The authors examine the recently revised Test of Understanding of College Economics (TUCE) available from the Joint Council on Economic Education. The article examines its reliability, validity, norms, and item statistics with attention to limitations.     

Information Theory and Attitude Formation in Economic Education

Hodgin presents an econometric model in which attitudes toward economics are modified by performance in the course (as grades accumulate) and in which performance is modified by changes in attitude. The “results” support the economics of information rationale that informational messages about performance in economics affect attitude.”     

Federal and Foreign Trade Deficits and the Future of the U.S. Economy

The author traces the course of the economy during the past few years, raising questions about its future course. Unless drastic (and seemingly unlikely) actions are taken, Due predicts the resumption of inflation, a depression, or both.