1,721,064 research outputs found
Ricchezza, benessere e vincoli internazionali: alternative per l'Europa, in "Istituzioni per il benessere sociale. Alternative per l'Europa"
No full text
Political Economy and the Constitution of Europe's Polity: Pathways for the common currency beyond ordo-liberal and neo-functionalist models
Full text linkThe Eurozone crisis has been variously described in financial or in fiscal terms, caused either by an over-leveraged banking system or by unsustainable budget deficits and national debt – or indeed both at once. But perhaps with the exception of Greece, neither holds true for individual euro-members or for the common currency area as a whole. The combined banking and sovereign debt crisis is symptomatic of a more fundamental set of structural problems such as trade imbalances, productivity differentials and the disconnection between financial flows and investment in productive activities that require a systemic analysis. By contrast with much of modern economics and political science that rest on rational choice and methodological individualism, this chapter seeks to develop an alternative political economy that can conceptualise the constitution of Europe’s polity – the complex economic, political and social space in which the Eurozone is inscribed.
From this political economy perspective, I argue that the euro-area is characterised by the primacy of harmonisation over mutualisation – a legacy of the neo-functional model of integration and the ordo-liberal model of coordination, which privilege joint procedures and common rules rather than the sharing of risks, rewards and resources. Mutualisation – the search for cooperative arrangements based on a balance of interests – offers an as yet unrealised potential to transform the Eurozone in line with the constitution of Europe’s polity. The chapter charts a path beyond the current debate that portrays the European Monetary Union (EMU) either as a misconceived experiment which should be abandoned in favour of national currencies (e.g. Pissarides 2013; Flassbeck and Lapavitsas 2015a and 2015b), or as a project beset by design failures which require centralisation (e.g. Marsh 2013; Sinn 2014), or as an arrangement which can work better with a different policy mix (e.g. Sandbu 2015).
My chapter runs as follows. First of all, the current crisis of the Eurozone can only be understood as part of a particular economic, political and social domain in which EMU is embedded. The domain in question is not limited to a set of institutions and rules within which markets, states and individuals interact (Buchanan 1990) but extends to political and social structures that embed both cooperation and conflict at – as well as across – different levels (Ornaghi 1990; Pabst and Scazzieri 2012). As an analytical framework, the approach to the political economy of constitution followed in this essay explores the multi-level dependencies that characterise economic integration within and between national states and transnational markets (Pabst 2014; Pabst and Scazzieri 2016; cf. Polanyi 2001).
Second, ordo-liberalism shares with the proposed ‘political economy of constitution’ the idea that the economic field is not self-standing but rather part of the overarching social field, which encompasses society and the state. However, ordo-liberal thinkers view the social domain as grounded in the constitutional-legal order that subordinates social ties to state laws and market contract. By bracketing social relationships out of the picture, the effect of ordo-liberal policies – creating the ‘framework conditions’ (Rahmenbedingungen) for perfect competition – is to disembed the economy from society and to re-embed political and social ties in predominantly contractual relations, which ignores the Eurozone’s structural problems.
Third, the dominant logic of European integration since the 1957 Rome Treaties has been neo-functionalism, which posits spill-over effects from economic interdependence to political unity (e.g. Haas 1961; Sandholtz and Stone Sweet 1997). Analogous to the concept of path dependency, neo-functionalism explains why European integration has privileged monetary integration over both a fiscal and a political union. Coupled with the influence of ordo-liberalism, this has constrained EMU crisis management and official proposals for reform.
Fourth, the European polity within which EMU is inscribed is neither a federal super-state nor a free-trade area but rather a political system sui generis (e.g. Hix 2005; Zielonka 2006 and 2008). This system consists in hybrid institutions, overlapping jurisdictions, multiple membership, polycentric authority and multi-level governance. As a unique polity, Europe contains a certain set of opportunities and constraints for political and economic cooperation. These opportunities and constrains provide the resources for a different exit from the Eurozone crisis and they can embed EMU in the political and social relations which provide the trust and cooperation on which a viable common currency depends.
Section 2 provides a brief outline of the wider causes of the Eurozone crisis. Section 3 develops a political economy of constitution as an analytical architecture to describe and explain the wider domain in which the Eurozone is inscribed. Section 4 examines ordo-liberal principles and policy prescriptions that underpin the creation of EMU and the Eurozone crisis management/resolution since early 2010. Section 5 provides an account of the (neo-)functional logic that has shaped the process of integration and the building of the European polity. Section 6 suggests a number of alternative pathways for the Eurozone. The final section provides some concluding reflections
Coordination, Context and Patterns of Reasoning
No full textThe paper argues that the individual filtering of information may be significantly different from one individual (or social group) to another, so that the likelihood of social congruence may be enhanced by individuals' ability to spot features of partial similarity across a variety of contexts. The paper informally identifies a social context as the set of conditions under which any specific co-ordination pattern (or set of co-ordination patterns) is feasible . A remarkable consequence of the shift of emphasis to co-ordination contexts is that, in a social universe characterized by a sufficient degree of internal differentiation, limited rationality makes congruence more likely (see below). A necessary condition for that is that individuals should be skilled social actors, so as to be able to identify similar attributes across a large number of individual (or social) types. This suggests that social equilibrium may be the unintended outcome of multiple cases of 'niche co-ordination'. In this case, however, the different niches should belong to a social continuum in which individuals (or groups) share certain features with adjacent individuals (or groups) though by no means with all agents in the same social set. Social congruence may be differently construed depending upon the rationality framework in which interaction takes place. A cognitive setting characterised by the ability to detect unusual connections in a diverse social universe is one in which rationality is practical rather than 'universal'. In this case, multiple foci breed distinct perspectives from which co-ordination may be sought.
The paper maintains that limited rationality suggests inferential diversity. The latter expresses itself by means of manifold attitudes to similarity and conceptual association. Indirect social knowledge may be derived from direct experiences as a result of lateral exploration (exploration within a continuum of partial similarities). And this process normally follows a different route depending upon the specific context in which each individual elaborates her (his) own cognitive endowment. This approach makes congruence an unintended outcome of social diversity, provided the latter follows the pattern of partial similarity and limited (local) difference described above
Virtue, Production and the Politics of Commerce: Genovesi’s ‘Civil Economy’ Revisited
Full text linkAntonio Genovesi’s economic-political treatise on civil economy was a major contribution to debates in the mid- and late eighteenth century on the nature of political economy. At that time, Genovesi’s book was extensively translated and discussed across continental Europe and Latin America, where it was read as a foundational text of political economy like Adam Smith’s Wealth of Nations. The aim of this paper is to contribute to the analysis of the mutual implication between the economic and the political order of society by revisiting Genovesi’s theory of civil economy defined by him as ‘the political science of the economy and commerce’. First, the paper retraces Genovesi’s conception of civil economy as a branch of political science and the role of virtue in ordering the polity according to ‘the nature of the world’. Second, it explores Genovesi’s theory of production as an inquiry into the complementarity conditions productive activities should meet for a well-functioning polity to persist over time. Third, our argument emphasises the importance of Genovesi’s analysis of production structures for his theory of internal and foreign trade. In this connection, the paper investigates Genovesi’s idea that the maintenance of a country’s ‘trading fund’ should be the fundamental objective for its internal and external trade policies. These policies, according to Genovesi, should be consistent with the context of the body politic under consideration and the economy’s proportionality requirements for any specific stage of development
The Political Economy of Industry
No full textThis chapter examines the political economy of industry, which we define as the relationship between production organisation and the power structure it generates. The political economy approach to industry highlights production organisation and its effects on both productivity and the dynamics of the whole economic system. More specifically, production organisation determines division of labour and its effects on workers’ specialisation and their modes of employment. This also determines how workers’ ‘skill, dexterity and judgement’ (Smith) can be applied and has important consequences for the distribution of power in societies. The chapter builds on the contributions of Classical Economists and applies the classical framework to explaining current evolutions in manufacturing. Particular attention is given to the work of Adam Smith, who is seen as the forerunner of a modern approach to the political economy of industry
A Theory of Similarity and Uncertainty
No full textThe paper calls attention to the ontological and epistemic roots of uncertainty, and emphasizes the plurality of grounds that could make evidence uncertain and induction tentative. In particular, we have seen that the sources of uncertainty are manifold due to the interplay of circumscription difficulty and epistemic complexity. However, it is precisely this lack of determinacy that allows the handling of uncertainty by means of a principle of non-exclusion. This is because the domain of similarity relations coincides with the partial overlap of the ontological and epistemic sets. The relationship between similarity and likelihood implies that multiple orders of likelihood are also possible: any given situation may be less or more likely depending on which particular order we are considering. In short, the domain of knowable uncertainty is constrained both on the ontological and the epistemic side. Within that domain, uncertainty allows similarity relationships and permits the assessment of likelihood. Multiple orders of likelihood may be associated with different degrees of rational belief as they are not all founded on an equally solid knowledge basis. However, as we have seen, multiple overlaps of likelihood orders may be possible. It is reasonable to conjecture that confidence in the likelihood assessment for any given situation would increase if a variety of different orders of likelihood were to assign the same likelihood assessment for that particular situation. For example, it is reasonable to think that situations associated with different orders of likelihood for the short- and the long-term would in fact be associated with strongest likelihood confidence in the case of cross-over points. In short, uncertainty at its most fundamental level is associated with co-existence of different orders of similarity and likelihood. This co-existence makes it very difficult to assess particular situations, as they might look respectively likely or unlikely depending on which features are considered. Clearly this difficulty may be due to the way in which any given situation is circumscribed, or to the categories available to make sense of existing circumscriptions. However, different likelihood orders may sometimes intersect one another (see above). This means that the very plurality of uncertainty dimensions that makes it difficult in general to assess any given situation, may turn out to be an advantage when facing the special circumstances in which the same assessment of the situation in view is grounded in a plurality of different orders of likelihood
Traverse Analysis and Methods of Economic Dynamics
No full textThe paper investigates dynamic methods used to assess transitional paths (traverses). In particular, section II examines what may be called short-run traverses, in which the initial and the final positions are both characterized by the same technology in use (even if the proportions between commodity outputs may be different from one position to another). Section III considers long-run traverses, in which technology in use is different between the original and the final state of the economy. This section calls attention to the richness of long-run traverse analysis in classical economic theory. In particular, this section examines the existence in classical theory of a dual approach to technical interrelatedness, which may lead both to vertical and horizontal bottlenecks along any given transitional path. Section IV discusses modern contributions to traverse analysis in the light of classical theory. This section argues that the theoretical prototypes to be found in classical literature (short- and long-run analysis; vertical and horizontal interrelatedness) are also at work in modern contributions to the analysis of transitional paths. Section V brings the paper to close by emphasizing the central role of the analytical representation of production processes in the investigation of transitional dynamics. In particular, this section highlights that the discussion of classical methods may be useful in identifying central characteristics of modern traverse analysis, such as the role of alternative representations of production, or the explicit introduction of apparently unrealistic assumptions. Recent attempts at the integration of the different classical methods are also discussed
Resources and Economic Dynamics, Technology and Rents
Full text linkThe essay investigates non producible (natural) resources and rent from three points of views: stylized facts, quantitative economics and economic theory. Taking the first point of view, the author discusses how economic growth can be represented in terms of never-ending tension between scarcity and technical progress. At least since the onset of modern economic growth, whenever scarcity produced a slowdown of growth, technical progress followed and scarcity was thereby removed. Scarcity, in a long-run perspective, has always been of the «relative» type, while absolute scarcity never set in. This essay consider this problem from many points of view. First of all it considers the point of view of quantitative economics like those of Simon Kuznets and Wassily Leontief who emphasized the relative character of scarcity and the importance of keeping the relationship between scarcity and innovation into account (this is especially true of Kuznets). Secondly the essay considers the contribution of economic theory. In this connection, the author points out that both the macroeconomic and multi-sectoral models developed since the 1930s overlooked the investigation of scarce natural resources and rent, as well as their relationship with technical progress. Only Piero Sraffa examined non producible resources and rent but he has done it in a single-period model. The author of this essay investigated the same issues in a more general analytical set-up starting with a contribution published in 1967 followed by many others. Later on, Quadrio Curzio and Pellizzari, especially in the 1996 volume, analyzed the general relationships among production, prices, income distribution, technical progress and growth when scarce resources play a significant role. Those contributions also investigated the nature of technological rents, which are an important feature of modern economic growth in the presence of technical progress. At the same time Quadrio Curzio, in collaboration with Marco Fortis and Roberto Zoboli, analysed historical, quantitative and qualitative aspects of economic dynamics, and the way in which natural resources and raw materials exert an influence on economic growth and more generally economic dynamics. Those aspects are not fully considered in the present essay, but they represent its fundamental background. Finally in 2008 Quadrio Curzio, Pellizzari and Zoboli outlined in a valuable encyclopaedic dictionary a compact synthesis of the above approach to the economic analysis of raw materials and primary commodities. The essay takes a point of view which is not typical of the «post- Keynesian» approach, yet it belongs to a post-classical perspective that is closely connected to the Italian-Cambridge tradition of political economy as a social discipline. Tradition on which Alberto Quadrio Curzio, especially researching with Roberto Scazzieri, focused his attention in many essays from a methodological point of view.natural resources; technological innovation; relative scarcity; investments; rent;
- …
