1,721,050 research outputs found
Three approaches to institutions in economic analysis: Polanyi, North and the surplus approach’s third way
No full textI compare three approaches to economic history and institutions: the classical surplus
approach, the Polanyian view, and New Institutional Economics (NIE). In the
first institutions are seen in relation to the production and distribution of the social
surplus. Research in economic anthropology, archaeology and history has validated
the fecundity of this approach. The Polanyian criticism to classical and neoclassical
theories is then considered and appreciated, although some severe limitations
are envisaged. A good part of the paper concentrate upon Douglass North, the NIE
most representative author in the field of economic history. Striking of North is
the attempt to replicate Marx’s relation between economics and institutions in the
context of neoclassical theory. Transaction costs economics revealed a dead end in
explaining institutions and the power of predatory élites. Lacking a material anchor
such as surplus theory, North’s theory became progressively more elusive and indeterminate.
On balance, a surplus-based Marxist-Polanyian approach is the most
promising direction although much further work is still necessary to explain the
coevolution of the economic and institutional sides of the economy
Neo-Kaleckian and Sraffian Controversies on the Theory of Accumulation
Full text linkNon-orthodox economists generally share the Keynesian Hypothesis of the
independence of investment from capacity savings, in the long run no less than in the
short run. This hypothesis marks an essential point of difference from neoclassical
theory. Keynes showed that within the limits of the existing capacity utilisation,
investment determines savings rather than the other way around. How best to extend
this conclusion to the long run is the object of the current paper. The paper assesses
the controversy on demand-led growth that has taken place since the mid-1980s
between neo-Kaleckian and Sraffian authors. The Sraffian front may be divided into a
first and a second Sraffian position, the latter being the Sraffian supermultiplier
approach. I shall argue that this second approach is the most promising framework for
analysing economic growth
Invecchiamento della popolazione e questione pensionistica. Considerazioni di lungo periodo
No full textThe paper begins with a brief examination of the ageing process at the global and national level. Italy will not suffer of a labour supply shortage in the short run (rather, it is labour demand to be scarce). In the long run, however, labour supply will shrink in spite of an expected increasing labour market participation, a moderate increase in fertility and a significant immigration. The old age dependency ratios dramatically rise, but the "total dependency ratio" increases much less. The inspection of the main pension reforms shows the difficulty of the substitution of pay-as-you-go schemes with fully funded plans, and the contradiction brought about by the notional contribution schemes between financial and social sustainability. More equity in income distribution would support the solidarity component of public pension schemes
Alternative interpretations of a stateless currency crisis
No full textA number of economists warned that a political union was a prerequisite for a viable currency union. This paper disputes the feasibility of such a political union. A fully fledged federal union, which would likely please peripheral Europe, is impracticable since it implies a degree of fiscal solidarity that does not exist. A Hayekian minimal federal state, which would appeal to core Europe, would be refused by peripheral members, since residual fiscal sovereignty would be surrendered without any clear positive economic and social return. Even an intermediate solution based on coordinated Keynesian policies would be unfeasible, since it would be at odds with German ‘monetary mercantilism’. The euro area is thus trapped between equally unfeasible political perspectives. In this bleak context, austerity policies are mainly explained by the necessity to readdress the euro area balance-of-payments crisis. This crisis presents striking similarities to traditional financial crises in emerging economies associated with fixed exchange regimes. Therefore, the delayed response of the European Central Bank (ECB) to the sovereign debt crisis cannot be seen as the culprit of the euro area crisis. The ECB’s monetary refinancing mechanisms, Target 2 and the ECB’s belated Outright Monetary Transactions intervention impeded a blow-up of the currency union, but could not solve its deep causes. The current combination of austerity policies and moderate ECB intervention aims to rebalance intra-eurozone foreign accounts and to force competitive deflation strategy
Pensions in an Ageing Society: a Symposium
No full textThe investigation of the economic impact of population trends cannot but
take into account the variety of the local situations, although in the global
economy there are formidable interactions among the different regions, due in particular
to labour and capital flows and trade. There are various aspects that deserve
attention. One is the impact of a shirking native workforce on the labour markets in
the developed countries, where the relative decline in the adult population will
start to bite in the next decades . Another
regards the expected growth in the costs of long-term care and medical assistance
for the ageing population.
The most hotly debated topic has, however, been pensions. Non-orthodox
commentators have always been suspicious of the demographic alarm raised by
mainstream scholars and by some international institutions (e.g. World Bank,
1994). This suspicion is warranted since the demographic indicators, such as the
ratio of old population to the working-age population, are misleading about the
economic sustainability of the inactive population which depends, inter alia, on
the share of the adult population that is actually employed and on the community’s
choices about the amount of output to be transferred to retirees. The apparently
careless use of the demographic indicators clearly reflects a neoclassical
outlook in which actual employment, given a competitive labour market, tends
to coincide with potential employment, and generous social transfers mechanically
displace capital accumulation.
The contributions to this Symposium look at the various indicators in innovative
ways. With particular reference to Europe, Pierre Concialdi points out
that in the next few decades the ageing process will reshuffle the composition of
the dependent population rather than dramatically increase its relative weight in
the working population. (Similar considerations are put forward by Wray with
respect to the US.) In many countries, moreover, the demographic alarm seems
premature since they currently suffer from low activity levels and employment
rates rather than from labour scarcity. This is still especially true in some European
countries in spite of the dramatic demographic changes that are occurring. In these
countries a ‘demographic window’ is still open to foster economic growth and
raise the employment rate in order to endow those economies with the physical
and intangible capital to cope with the prospective ageing of the population.
This ‘window’ is about to be lost, not least owing to the deflationary economic policies
adopted by the European Monetary Union, as is forcefully noted below by
Massimo Pivetti in his contribution. This is the real danger
Balance of Payments or Monetary Sovereignty? In Search of the EMU's Original Sin. Comments on Marc Lavoie’s “The Eurozone: Similarities to and Differences from Keynes’s Plan”
No full textIn a recent paper Marc Lavoie (2014) has criticized my interpretation of the Eurozone (EZ)
crisis as a balance of payments crisis (BoP view for short). He rather identified the original sin “in
the setup and self-imposed constraint of the European Central Bank” and, more in general, as
expressed by other scholars, in the dissociation between fiscal and monetary policy. This is defined
as the (flawed EMU) institutional set-up view. According to the (prevailing) BoP view, supported
with different shades by a variety of economists from the conservative Sinn to the progressive
Frenkel, the original sin is in the current account (CA) imbalances brought about by the
abandonment of exchange rate adjustments and in the inducement to peripheral countries to get
indebted with core countries. The original sin is the euro. The two view are not necessarily
juxtaposed. While the BoP crisis looks as a fact, a better institutional design would have likely
avoided the current crisis as long as it involved regional transfers robust enough to overcome the
mentioned imbalances
The State Spends First: Logic, Facts, Fictions, Open Questions
Full text linkKeynesian (or Kaleckian) logic leads post Keynesian economists to presume that a variation of state revenues from taxes and sales of Treasury bonds are the result of a variation in state spending and not the other way around. In the past two decades, the exponents of modern monetary theory (MMT) have been at the forefront in asserting the Keynesian (or Kaleckian) logic of this proposition, filling a theoretical vacuum in post Keynesian thinking. The question is that MMT consolidates the Treasury and Central Bank (CB) so that the latter automatically creates purchasing power in favor of decisions of the former to spend. Critics, however, point out that most institutional arrangements forbid CBs to finance the Treasury directly. After Lavoie (2013) the debate has moved forward and seen some convergence. The present paper critically reviews for unfamiliar readers an otherwise almost esoteric but fundamental discussion
Pensions in a shrinking economy: a comment on Kuné
Full text linkIn a contribution to this journal, Prof. Jan Kun é discusses whether a fully funded (FF)
pension scheme can cope with a demographic shock better than a pay-as-you-go (PAYG) system.
He makes ample use of my own contributions on this issue but ignores my criticism of the neoclassical
interpretation of FF pension schemes, and especially of the claim that an FF scheme is superior to
PAYG in this and other respects. The purpose of this note is to stimulate some response, from
Prof. Kun é or others, to my critique of the neoclassical interpretation. The policy implications of this
discussion for pension reforms are evident
Sei lezioni di economia: Conoscenze necessarie per capire la crisi più lunga (e come uscirne)
No full textDai perdenti della globalizzazione alla bancarotta dell’euro passando per Marx, Sraffa e Keynes. Lo scontro fra le grandi teorie economiche, gli arcani delle politiche di Draghi e il fallimento dell’Europa raccontati con passione intellettuale e impegno civile. Questo libro si rivolge a chi in questi anni non ha accettato le spiegazioni convenzionali di una crisi devastante e l’idea che «siamo un Paese corrotto, fortuna che Europa ed euro ci fan rigare dritti». Da Adam Smith a Schauble, l’ambizione del volume è di intrecciare la teoria economica alle drammatiche vicende della crisi europea, dell’euro, del declino del nostro Paese. Non basta prendersela col “neoliberismo”, le “banche malvagie”, la “finanza speculativa” o la “corruzione”. Si deve scavare nelle fondamenta della teoria convenzionale che è dietro le politiche monetarie e fiscali europee, la deregolamentazione finanziaria, lo smantellamento dei diritti sociali (le cosiddette “riforme strutturali”), il mercantilismo tedesco.Muovendo dalle teorie di Sraffa e Keynes e dalla letteratura eterodossa, il volume mostra la debolezza di quelle fondamenta e la natura conservatrice della costruzione europea. Analisi economica critica e realismo politico ci suggeriscono che, sfortunatamente, un’ “altra Europa” non è possibile in quanto le entità̀ politiche e monetarie sovranazionali hanno un’insopprimibile impronta liberista, e sono funzionali a smantellare gli spazi nazionali in cui si esprime il conflitto sociale che, se regolato, è il sale della democrazia
Savings and economic growth in neoclassical theory: A Critical Survey
No full textIn neoclassical economics economic growth depends upon savings. The paper discusses problems with this conventional view, and how these have been tackled, from pre-Solowian authors up to the recent New or Endogenous Growth Theory (EGT). These difficulties became particularly clear with the Solow-Swan model of growth in which the savings rate did not affect the rate of growth. In the absence of exogenous circumstances, savings would only depress the marginal productivity of capital forcing the economy towards a stationary state. The paper interprets EGT as an attempt to react to this gloomy theoretical prospect. The paper examines various difficulties with this attempt
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