In this article, it is shown that a wide range of comparative statics results from expected utility theory can be extended to generalized expected utility models using the tools of supermodularity theory. In particular, a range of concepts of decreasing absolute risk aversion may be formulated in terms of the supermodularity properties of certainty equivalent representations of preferences.

Stipulating universal propositions with a ceteris paribus clause is normal practice in science and especially in economics. Yet there are several problems associated with the use of ceteris paribus clauses in theorising and in policy matters. This paper first investigates three questions: how can ceteris paribus clauses be non-vacuous? How can ceteris paribus laws be true? And how can they help in formulating successful policy interventions in a diversity of contexts? It turns out that ceteris paribus clauses are not always (...) used legitimately. They are meant to fence off a theory from disturbing factors, but economists who do not specify the clause well enough tend to fence variables in rather than off. In such cases, it would be better to use theoretical abstraction, which is something very different from the use of ceteris paribus clauses. However, abstract theorising conceptually leads one away from the concrete detail of real world situations in which policies take place. Hence, a fourth question arises: how can policy interventions be properly designed on the basis of abstract laws? To answer this question, I defend interdisciplinarity in concept choice. (shrink)

In this study, Don Ross explores the relationship of economics to other branches of behavioral science, asking, in the course of his analysis, under what interpretation economics is a sound empirical science. The book explores the relationships between economic theory and the theoretical foundations of related disciplines that are relevant to the day-to-day work of economics -- the cognitive and behavioral sciences. It asks whether the increasingly sophisticated techniques of microeconomic analysis have revealed any deep empirical regularities -- (...) whether technical improvement represents improvement in any other sense. Casting Daniel Dennett and Kenneth Binmore as its intellectual heroes, the book proposes a comprehensive model of economic theory that, Ross argues, does not supplant, but recovers the core neoclassical insights, and counters the caricaturish conception of neoclassicism so derided by advocates of behavioral or evolutionary economics. Because he approaches his topic from the viewpoint of the philosophy of science, Ross devotes one chapter to the philosophical theory and terminology on which his argument depends and another to related philosophical issues. Two chapters provide the theoretical background in economics, one covering developments in neoclassical microeconomics and the other treating behavioral and experimental economics and evolutionary game theory. The three chapters at the heart of the argument then apply theses from the philosophy of cognitive science to foundational problems for economic theory. In these chapters, economists will find a genuinely new way of thinking about the implications of cognitive science for economics, and cognitive scientists will find in economic behavior, a new testing site for the explanations of cognitive science. (shrink)

Slight absolute changes in the Shanghai Stock Exchange Index (SHSE) corresponded to the city’s immediate increases in coronary heart disease deaths and stroke deaths. Significant fluctuations in the Shenzhen Stock Exchange Index (SZSE) corresponded to the country’s minor, delayed death rates. Investors deal with money, greed, stock volatility, and risky decision-making. Happy people live longer and better. We ask the following question: Who are the investors with the highest and most sustainable stock happiness, and why? Monetary wisdom asserts: Investors apply (...) their deep-rooted values (avaricious love-of-money aspiration and locus of control, Level 2) as a lens to frame critical concerns in the proximal-immediate (Shanghai Stock Exchange Index changes, Level 1) and the omnibus-distal contexts (domicile: city vs. country, Level 2) to maximize expected utility (portfolio changes, Level 1) and ultimate serenity (stock happiness, Level 1). We collected multilevel data—the longitudinal SHSE and 227 private investors’ daily stock happiness and portfolio changes for 36 consecutive trading days in four regions of China. Investors had an average liquid asset of $76,747.41 and $54,660.85 in stocks. This study is not a “one-shot” game with “nothing at stake.” We classified Shanghai and Beijing as the city and Shenzhen and Chongqing as the country. Our cross-level 3-D visualization reveals that regardless of SHSE volatility, investors with low aspiration, external control, and country domicile enjoy the highest and most sustainable stock happiness with minimum fluctuations. Independently, investors with low aspiration, external control, and country domicile tend to make fewer portfolio changes than their counterparts. Behaviorally, less is more, debunking the myth—risky decisions excite stock happiness. Our longitudinal study expands prospect theory, incorporates attitude toward money, and makes robust contributions to behavioral economics and business ethics. We help investors and ordinary citizens make happy, healthy, and wealthy decisions. Most importantly, the life you save may be your own. (shrink)

This is a history of economic thought from Adam Smith to John Maynard Keynes - but it is a history with a difference. Firstly, it is a history of economic theory, not of economic doctrines, that is, it is consistently focused on theoretical analysis, undiluted by entertaining historical digressions or biological colouring. Secondly, it includes detailed Reader's Guides to nine of the major texts of economics, namely the works of Smith, Ricardo, Mill, Marx, Marshall, Wickstead, Wicksell, (...) Walras and Keynes, in the effort to encourage students to become acquainted at first hand with the writings of all the great economists. This fifth edition, first published in 1997, adds new Reader's Guides to Walras's Elements of Pure Economics and Keynes' General Theory to the previous seven Reader's Guides of other great books in economics. There are significant and major additions to six chapters. (shrink)

Economic theories of democratic legitimacy have criticized deliberative accounts of democratic legitimacy on the grounds that they do not represent a practical possibility and that they create conditions that make actual democracies worse. It is not simply that they represent the wrong ideal. Rather, they are too idealistic – failing to show proper regard for the cognitive and moral limitations of persons and the depth of disagreement in democratic society. This article aims to show that the minimalist criterion of (...) democratic legitimacy is self-defeating and that even if there are minimal cognitive, moral, and social requirements for the possibility of practicable deliberative democracy, these limitations do not necessarily impose insuperable barriers for democratic deliberation as the normative basis of democratic legitimacy. Thus, the limiting facts do not dictate the structure of appropriate normative models of democracy in the way minimalists have supposed. (shrink)

The phenomenon of performativity has recently sparked debates about the status of the economic discourse. This paper aims to discuss the subjectivist idea that if economics ‘performs’ social reality, rather than merely reflects it, then every theory can be considered ‘true.’ My main goal is to point out three limits of performativity. First, not all theories can be performative since some do not produce empirical landmarks for agents. Second, social institutions restrict performativity. Third, I emphasize the necessity that (...) a theory to be self-fulfilling. This article is a prelude to a new kind of performative studies based on an original definition: a theory performs the world if it implies a behavioral regularity which leads to a general coordination between agents. That is to say, if it becomes a convention à la David Lewis. (shrink)

Originally published in 1981, Dr Currie's main emphasis in this book is on the economic theory of agricultural land tenure, but he also makes extensive reference to the historical development of land tenure in England. After consideration of the history of economic thought on this important topic, he employs an essentially neo-classical approach, though one that pays due attention to the nature of institutional arrangements and particular forms of property rights. In dealing with these latter aspects, he (...) considers not only the economic effects of particular institutional forms but also their economic causes. The careful use of the history of land tenure development gives this work especial relevance for agricultural development and for issues of land reform. The Physiocrats and Classical economists gave land tenure an important place in their work. Following a long period of' neglect by Neo-Classical economists, land tenure arrangements again received considerable theoretical attention in the years preceding publication. Dr Currie draws on and develops this work. Moreover, he investigates the importance of a number of crucial issues that were being neglected at the time. (shrink)

Many authors in the discipline as well as outsiders have claimed that the main results from Mathematical Economics are far removed from real world phenomena. A more precise version of this position is that one of the main reasons for this unrealistic stance is the use of the wrong formal tools. So, for example, it has been pointed out that the computability of choice functions as well as the existence of economic equilibria and of states of the world may (...) not be ensured in general if the assumed set theory is ZFC. We will show that there exists a very natural set theory that overcomes some formal limitations of contemporary economic theory. A switch to an alternative set theory helps to obtain in a more natural way results widely accepted by mathematical economists. Moreover, alternative set-theoretical frameworks convey different intuitions about how agents behave when solving problems. We claim that AFA−+AD+DC is the adequate alternative set-theoretical universe for economic theory. (shrink)

Context: Due to its grounding in a simplistic core model, mainstream theoretical work in economics is heavily conditioned by a realist epistemic framework that may be viewed as the “paradogma” – sensu Mitterer – of economics. Problem: The contribution delineates theoretical developments on the basis of a realist epistemology and their problem-laden consequences for the economic sciences. The subsequent critical discussion seeks to clarify whether economic theory formation is a suitable field for the application of Mitterer’s non-dualist (...) ideas. Method: In the context of a review of their historical background, the paper will explore the possibilities and limits of an application of Mitterer’s non-dualist argumentation to the economic sciences, and present a diagnosis of compatibility and a characterisation of necessary steps towards amplification. Results: It can be shown that the economic sciences would gain in expert knowledge and applicability by adopting the alternative of non-dualism, whose potential has been little appreciated so far. The solution to the meta-scientific problems caused by the pre-structuring of economics in terms of a realist epistemology seems at hand. To take up this new meta-scientific perspective, however, theoretical progress in both non-dualism and economics is required, particularly by paying more serious attention to the theoretical component of communication. Implications: Non-dualism can certainly be utilised by the economic sciences to induce radical innovations and conceptional revisions involving higher meta-scientific consistency. In future, pragmatic gaps will increasingly have to be filled conceptually in order to develop more highly-reflected economic theory formation and corresponding scientific practice. Hence the main idea is that economic actions are inevitably, but not exclusively, based on communication. Constructivist content: Theoretical approaches embracing epistemic relativism in the economic sciences will be properly assessed and developed further along the lines of a non-dualist conceptual revision on the basis of an ontology-free understanding of reality. (shrink)

Patient autonomy, as exercised in the informed consent process, is a central concern in bioethics. The typical bioethicist's analysis of autonomy centers on decisional capacity—finding the line between autonomy and its absence. This approach leaves unexplored the structure of reasoning behind patient treatment decisions. To counter that approach, we present a microeconomic theory of patient decision-making regarding the acceptable level of medical treatment from the patient's perspective. We show that a rational patient's desired treatment level typically departs from the (...) level yielding an absence of symptoms, the level we call ideal. This microeconomic theory demonstrates why patients have good reason not to pursue treatment to the point of absence of physical symptoms. We defend our view against possible objections that it is unrealistic and that it fails to adequately consider harm a patient may suffer by curtailing treatment. Our analysis is fruitful in various ways. It shows why decisions often considered unreasonable might be fully reasonable. It offers a theoretical account of how physician misinformation may adversely affect a patient's decision. It shows how billing costs influence patient decision-making. It indicates that health care professionals' beliefs about the ‘unreasonable’ attitudes of patients might often be wrong. It provides a better understanding of patient rationality that should help to ensure fuller information as well as increased respect for patient decision-making. (shrink)

The methodological foundations of any scientific discipline are shaped by the goals towards which that discipline is aiming. While it is almost universally accepted that the goals of explanation and prediction of natural and non-human phenomena have been met with great success since the scientific revolution, it is almost just as universally accepted that the social sciences have not even come close to achieving these goals. This raises the question addressed in this paper, namely, what is economics, and social science (...) more broadly speaking, for? What is their aim, and how is it similar and dissimilar to that of the natural sciences as we have come to classify them? I take up this question from a pragmatic perspective in this paper, setting economics within the wider context of social inquiry. Specifically, I turn to Hilary Putnam and John Dewey as exemplars of the pragmatic critique of any economics that sees its goals in line with those of the natural sciences, that is, as aiming for explanation and prediction according to governing laws of human behaviour. NB: this is a preprint that underwent some minor edits. (shrink)

The concept of revolution marks the ultimate horizon of modern politics. It is instantiated by sites of both hope and horror. Within progressive thought, “revolution” often perpetuates entrenched philosophical problems: a teleological philosophy of history, economic reductionism, and normative paternalism. At a time of resurgent uprisings, how can revolution be reconceptualized to grasp the dynamics of social transformation and disentangle revolutionary practice from authoritarian usurpation? Eva von Redecker reconsiders critical theory’s understanding of radical change in order to offer (...) a bold new account of how revolution occurs. She argues that revolutions are not singular events but extended processes: beginning from the interstices of society, they succeed by gradually rearticulating social structures toward a new paradigm. Developing a theoretical account of social transformation, Praxis and Revolution incorporates a wide range of insights, from the Frankfurt School to queer theory and intersectionality. Its revised materialism furnishes prefigurative politics with their social conditions and performative critique with its collective force. Von Redecker revisits the French Revolution to show how change arises from struggle in everyday social practice. She illustrates the argument through rich literary examples—a ménage à trois inside a prison, a radical knitting circle, a queer affinity group, and petitioners pleading with the executioner—that forge a feminist, open-ended model of revolution. Praxis and Revolution urges readers not only to understand revolutions differently but also to situate them elsewhere: in collective contexts that aim to storm manifold Bastilles—but from within. (shrink)

Company Law: Theory, Structure and Operation is the first United Kingdom law text to use economic theory to provide insights into corporate law, an approach widely adopted in the United States. In this book, Brian Cheffins discusses the inner workings of companies, examines the impact of the legal system on corporate activities, and evaluates the merits of governmental regulatory strategies. The book covers core areas of the undergraduate company law syllabus in a stimulating and theoretically enlightening fashion (...) and addresses important company law topics such as: * limited liability of shareholders * shareholders' remedies * corporate governance * executive pay * the role of self-regulation in United Kingdom securities markets * the impact of European Union Directives on company law in the UK Brian Cheffins also examines in detail a number of questions which have not been fully explored elsewhere. These include: * What are the justifications for legal regulation of company affairs? * What are the drawbacks associated with government intervention? * How can one ascertain the optimal format for company law rules? (shrink)

Economics is the only established discipline that is regularly charged not just with including ideologically motivated research programs and hypotheses, but with actually being (at least in its institutionalized mainstream form) an ideology. As Coleman (2002) documents, this charge has followed economics since its modern inception as ‘political economy’ in the eighteenth century. There is a veritable tradition of what Coleman calls ‘anti-economics’, most famously populated by people such as Ruskin and Carlyle, and extending in the contemporary environment to include (...) philosophers John Gray[1] and John Dupré,[2] numerous popular agitators associated with environmentalism and the self-styled ‘anti-capitalist’ and ‘anti-globalization’ movements, and no small number of disillusioned economists.[3] Of course all disciplinary establishments rightly attract critical literature; but as far as I know no one has ever published a book called ‘The Death of Geology’ featuring a hangman’s noose on the cover.[4] Coleman’s compendium of evidence shows conclusively, in case anyone hasn’t been keeping their eyes and ears open, that economics is actively hated by a substantial number of people. There is no other discipline of which this is true, except insofar as some people hate all actual and would-be scientific disciplines from religious, green, or aesthetic motivations. (shrink)

War often comes down to one thing: money. The role of economics in the study of both peace and war is arguably then the most important single factor when it comes to the study of defence. This excellent new book from Fanny Coulomb will be of interest not only to those involved in the burgeoning field of defence economics - it will also be of vital interest to students and academics from international relations, defence studies, philosophy and political science backgrounds.

Organisations that design and deploy artificial intelligence (AI) systems increasingly commit themselves to high-level, ethical principles. However, there still exists a gap between principles and practices in AI ethics. One major obstacle organisations face when attempting to operationalise AI Ethics is the lack of a well-defined material scope. Put differently, the question to which systems and processes AI ethics principles ought to apply remains unanswered. Of course, there exists no universally accepted definition of AI, and different systems pose different ethical (...) challenges. Nevertheless, pragmatic problem-solving demands that things should be sorted so that their grouping will promote successful actions for some specific end. In this article, we review and compare previous attempts to classify AI systems for the purpose of implementing AI governance in practice. We find that attempts to classify AI systems proposed in previous literature use one of three mental models: _the Switch_, i.e., a binary approach according to which systems either are or are not considered AI systems depending on their characteristics; _the Ladder_, i.e., a risk-based approach that classifies systems according to the ethical risks they pose; and _the Matrix_, i.e., a multi-dimensional classification of systems that take various aspects into account, such as context, input data, and decision-model. Each of these models for classifying AI systems comes with its own set of strengths and weaknesses. By conceptualising different ways of classifying AI systems into simple mental models, we hope to provide organisations that design, deploy, or regulate AI systems with the vocabulary needed to demarcate the material scope of their AI governance frameworks. (shrink)

Professor Roemer's goal in this book is to give a rigorous view of classical Marxian economic theory by presenting specific analytic models. The theory is not extended to deal with new problems, but it is deepened: Marxian theory is given micro-foundations and upon those foundations the author begins to rebuild a tightly constructed Marxian economics. The book begins, after a methodological introduction, with an examination of the Marxian notion of equilibrium and the theory of exploitation, (...) and goes on to deal with the theory of the falling rate of profit. The next section explores one of the points made in the first section of the book, that the Marxian theory of exploitation can be constructed completely independently of the labor theory of value as a theory of exchange. Technical study of this problem allows comment on various issues, such as the relative importance of 'marginal utilities' and 'class struggle' in determining relative prices. The final part examines models of various Marxian concepts. (shrink)

Alexander Rosenberg (1983) has argued, contrary to his previous work in the philosophy of economics, that economics is not science, and it is merely mathematics. The following paper argues that Rosenberg fails to demonstrate either of these two claims. The questions of the predictive weakness of modern economics and the cognitive standing of abstract economic theory are discussed in detail.

It is widely believed that experimental results of behavioral game theory undermine standard economic and game theory. This paper suggests that experimental results present serious theoretical modeling challenges, but do not undermine two pillars of contemporary economic theory: the rational actor model, which holds that individual choice can be modeled as maximization of an objective function subject to informational and material constraints, and the incentive compatibility requirement, which holds that macroeconomic quantities must be derived from (...) the interaction and aggregation of individual choices. However, we must abandon the notion that rationality implies self-regarding behavior and the assumption that contracts are costlessly enforced by third parties. (shrink)

In lieu of an abstract, here is a brief excerpt of the content:Diacritics 31.3 (2001) 3-14 [Access article in PDF] IntroductionTheory, Globalization, Cultural Studies, and the Remains of the University Marc Redfield Theory, globalization, university: not just any words. So much commentary has grown up around them; and to write about one of these terms seems always to involve writing about another, sliding down a chain of associations that on the one hand leads straight to the most reductive American (...) mass-media representations of the academy (theory as a species of "postmodernism," ruining the university), yet on the other hand structures some of the most interesting and challenging writing in the humanities today. Cultural studies is perhaps a somewhat more recent and less layered term, but it too has come to serve as a charged nexus of discussion, and has proved inextricable from discussions of theory in the university in a globalized world. Yet despite the commerce among these keywords, the debates about them have tended, with notable exceptions, to remain somewhat distinct. Identifiable mini-traditions exist: arguments about theory that in some of their versions have persisted nearly unaltered since the early 1970s; more recent debates about cultural studies; a conflux of sociological, economic, and cultural discussions around the notion of globalization; an ongoing debate about the university, most recently galvanized by Bill Readings's University in Ruins (1996). 1 Our title offers a slant-rhyme homage to Readings's book, which most of our contributors reference and two or three engage directly, and which constitutes an exemplary effort to provide a story about the modern and postmodern university that would also be a story about globalization, theory, and cultural studies.It is the wager of this special issue of Diacritics that such stories demand to be told, because in fractured form they are persistently being told, through the relays that take us from one keyword or discursive microtradition to another. This does not mean that we expect to come up with a coherent metanarrative—to ascend, on the wings of speculation, to a vantage from which this particular quadrant of modernity's rugged landscape would become visible. In meditating on theory, globalization, cultural studies, and the university, we are directing our thinking toward internally split conceptual nodes that never quite resolve into stable concepts to be apprehended. Samuel Weber, always attuned [End Page 3] to the complexities of words, begins his contribution to this special issue by unpacking its title into a sequence of contradictions. Theory as conceptual vision (theoria) names the subject's appropriation of objects; yet in recent decades theory also has come to signify a critique of the subject-object model of cognition. The university is the institutional site of both sorts of theory: on the one hand, dedicated to the transmission and production of universally valid cognition; on the other hand, the place where a theoretical critique of theory has found its ambivalent and precarious, but to some extent effective, occasion. Globalization suggests on the one hand the crossing of frontiers and the transformation of substance into relation, yet on the other hand names the reinstatement of substance and identity at the level of the "globe" itself. Weber wrote his essay before I added cultural studies to the special issue's title, but one can easily extend his observation to this fourth term: on the one hand, cultural studies summarizes a range of approaches that have in common a valorization of the local and particular; on the other hand, in its all-embracing emptiness, the adjective cultural invokes the formalization of the human that constitutes the master narrative of aesthetic ideology. None of these terms yield a stable precipitate, and their interrelations are correspondingly volatile.The matter is further complicated by the deep roots and many-layered contexts of these institutionally and historically local arguments. In their instability and doubleness, both theory and cultural studies form part of the vast, border-rupturing discourse of modern aesthetics. Indeed, the case can be made—I have tried to make it elsewhere—that the journalistic equation of "theory" with "deconstruction" and the subsequent confusing of "theory" (as "deconstruction") with "cultural... (shrink)

Ethical theories have been largely focused on finding and clarifying certain amoral principles. However fruitful the communication of moral principles for providing orientation in modern society might be, a serious omission has been made in that the problem of implementation is not addressed. Two fundamental question have neither been raised nor answered: Why should self‐interested individuals follow the proposed moral principles in their daily conduct? Are societal institutions of such a design that is in the power of the individuals to (...) follow these moral principles? It is shown in this article that an economic theory of morals does systematically address these two questions and therefore provides a firm basis for discussing the possibilities and boundaries of following the moral principles inherent in the long history of moral philosophy. (shrink)

Ethical theories have been largely focused on finding and clarifying certain amoral principles. However fruitful the communication of moral principles for providing orientation in modern society might be, a serious omission has been made in that the problem of implementation is not addressed. Two fundamental question have neither been raised nor answered: (1) Why should self‐interested individuals follow the proposed moral principles in their daily conduct? (2) Are societal institutions of such a design that is in the power of the (...) individuals to follow these moral principles? It is shown in this article that an economic theory of morals does systematically address these two questions and therefore provides a firm basis for discussing the possibilities and boundaries of following the moral principles inherent in the long history of moral philosophy. (shrink)

In this paper a theory relating to the causal factors operative in the origin of living systems is presented.Let us consider living forms as material systems exhibiting, in addition to those properties held in common with all matter, systemic properties of a specific nature. If, then, the matter of the earth is classified from this standpoint, it is found that these systems are distributed only over the surface of the earth or in a shallow upper layer. This fact (...) indicates that the special properties of these systems are related in some manner to factors introduced at the surface and not operative elsewhere. (shrink)

Is economics always self-corrective? Do erroneous theorems permanently disappear from the market of economic ideas? _Intellectual Path Dependence in Economics _argues that errors in economics are not always corrected. Although economists are often critical and open-minded, unfit explanations are nonetheless able to reproduce themselves. The problem is that theorems sometimes survive the intellectual challenges in the market of economic ideas even when they are falsified or invalidated by criticism and an abundance of counter-evidence. A key question which often (...) gets little or no attention is: why do economists not reject theories when they have been refuted by evidence and falsified by philosophical reasoning? This book explores the answer to this question by examining the phenomenon of intellectual path dependence in the history of economic thought. It argues that the key reason why economists do not reject refuted theories is the epistemic costs of starting to use new theories. Epistemic costs are primarily the costs of scarcity of the most valued element in academic production: time. Epistemic scarcity overwhelmingly dominates the evolution of scientific research in such a way that when researchers start off a new research project, they allocate time between replicable and un-replicable research. This book is essential reading for anyone interested in the methodology, philosophy and history of economics. (shrink)

Critics of mainstream economics typically rest important weight on the differences between people and the 'agents' that populate economic theory and economic models. Hollis and Nell (1975) is both representative of and ancestral to many more recent variations on the theme. Lately, the upgraded status of behavioral economics (BE) within the discipline's mainstream has encouraged a number of writers to use revolutionary rhetoric in promotion of a 'paradigm shift' that includes the rejection of 'rational economic man' (...) (Ormerod 1994, Heilbroner and Milburg 1995, Fullbrook 2003). The current leading developers of BE are generally more circumspect, claiming that their approach complements standard theory rather than promising to supplant it (Camerer and Loewenstein 2004, Angner and Loewenstein this volume). However, they generally join the more florid critics in supposing that microeconomics is bound to improve its empirical relevance to the extent that it substitutes the study of people for that of abstract economic agents. Another body of thought that promotes this view stems from Sen's (1977) attack on standard economic agents as 'rational fools', amplified in Davis's (2003) argument that since economic agents lack some essential properties of human individuals, economic theory requires fundamental reform if it is to make progress in explaining human behavior. (shrink)

Neoclassical and Austrian/evolutionary economic paradigms have different implications for integrating corporate social responsibility (corporate citizenship) and competitive strategy. porter's "Five Forces" model implicitly rests on neoclassical theory of the firm and is not easily reconciled with corporate social responsibility. Resource-based models of competitive strategy do not explicitly embrace a particular economic paradigm, but to the extent their conceptualization rests on neoclassical assumptions such as imperfect factor markets and profits as rents, these models also imply a trade-off between (...) competitive advantage and corporate social responsibility. Differences in Austrian/evolutionary economic model's assumptions about equilibrium, profits, and other economic concepts allow this paradigm to embrace alternative views of strategy such as the activities or dynamic capabilities views. These alternative views of strategy focus on learning and adaptation; they align more easily with corporate social responsibility. In practice this alignment comes about because social engagement facilitates the learning and adaptation that are a source of competitive advantage. Among the many business arguments for CSR such as improved employee morale/productivity or brand differentiation, this view prioritizes innovation. (shrink)

Over the last few decades, theoretical discussions about metaphors have appeared with increasing frequency in the literature and, during the last fifteen years or so, such discussions have become more and more common in the methodology of economics. But what exactly is a metaphor? According to a tradition which dates back to Aristotle, a metaphor is the attribution to one object, A, of the name of another object, B, while this name or these qualities do not properly or normally belong (...) to A. Thus, a metaphor is present when a term used to describe A is a term which is already commonly used to name B. Defined in such a way, one must admit that metaphors are frequently found in economics as well as in other sciences. Let us consider, for example, a term like ‘elasticity’ which is extensively used by economists. According to the ordinary dictionary definition, this word designates a property of bodies by which they recover their initial form after having been submitted to a pressure; in a less technical sense, it refers to the flexibility of some bodies or to their responsiveness to pressures. (shrink)

Roughly speaking all economists can be divided into two groups--those who agree with Milton Friedman and those who do not. Both groups, however, espouse the view that science is a series of approximations to a demonstrated accord with reality. Methodological controversy in economics is now merely a Conventionalist argument over which comes first--simplicity or generality. Furthermore, this controversy in its current form is not compatible with one important new and up and coming economic (welfare) theory called "the (...) class='Hi'>theory of the Second Best." In this paper I offer a Second Best meta-theory that says that (1) any compromise between simplicity and generality must yield a theory which is "third best" by these Conventionalist criteria; and (2) there exists a better way than a compromise. (shrink)

Debate about deregulation has focused considerable attention on the pricing policies of public utilities. Much work has been done by economists on this subject, and in this book the results of that research are presented and made accessible to students of economics. The main subject is the policy to be followed by a regulated monopoly, but the analysis is broadened to take account of a fringe of competitive suppliers, making it relevant to electric utilities and local telephone companies in the (...) US, to PTT's in Europe, to the possible privatisatibn of telecommunications in Australia, and to the telecommunications structure in the UK where the dominant supplier has recently been privatised. The book gives a unified and simplified exposition of the modern theory of efficient pricing which is not available elsewhere. The theoretical discussion is supplemented by numerical simulation comparing Fully Distributed Cost Pricing, Ramsey Pricing, and Optimal Non-uniform Pricing. (shrink)

By examining the development of economics in the 20th century, this book argues that the breakthroughs of post WWII general equilibrium theory and its rejection of utilitarianism and marginal productivity have been misunderstood. Mandler maintains that although earlier neoclassicism deserved criticism, current theory does not adequately address the problems the discarded concepts were designed to solve, and that intractable dilemmas therefore appear.

This book is about the conceptual foundations of an intermediate way between liberalism and socialism: a synthesis of classical and Keynesian political economy. Classical theory deals with proportions between individuals or collectives and society in tackling problems of distribution and value. Keynesian theory is concerned with the scale of economic activity as explained by effective demand. The economy considered is primarily a monetary production economy, not a market or a planned economy. The author sets up a system (...) linking political economy with other social sciences, i.e. sociology, law and politics in the traditional sense, thus establishing the unity of the social sciences. To complete the picture, issues of method associated with the theory of knowledge in the social sciences and the problem of linking theory with historical reality are also covered. (shrink)

The Corporate Social Responsibility (CSR) field presents not only a landscape of theories but also a proliferation of approaches, which are controversial, complex and unclear. This article tries to clarify the situation, mapping the territory by classifying the main CSR theories and related approaches in four groups: (1) instrumental theories, in which the corporation is seen as only an instrument for wealth creation, and its social activities are only a means to achieve economic results; (2) political theories, which concern (...) themselves with the power of corporations in society and a responsible use of this power in the political arena; (3) integrative theories, in which the corporation is focused on the satisfaction of social demands; and (4) ethical theories, based on ethical responsibilities of corporations to society. In practice, each CSR theory presents four dimensions related to profits, political performance, social demands and ethical values. The findings suggest the necessity to develop a new theory on the business and society relationship, which should integrate these four dimensions. (shrink)

Mandler argues that post WWII general equilibrium theory, with its rejection of utilitariansim and marginal productivity, does not adequately address the problems earlier neoclassicism - however flawed it may have been - was designed to solve.

The elaborated intrusion (EI) theory of desire (Kavanagh, Andrade, & May, 2005) attributes the motivational force of cravings to cognitive elaboration, including imagery, of apparently spontaneous thoughts that intrude into awareness. We report a questionnaire study in which respondents rated a craving for food or drink. Questionnaire items derived from EI theory formed a single factor alongside factors for anticipated reward/relief, resistance, and opportunity. In a multiple regression predicting strength of craving, the first three factors accounted for 36% (...) of the variance. Opportunity did not enter the model. In a second study, the difference between individuals' strong and weak cravings to take part in a sporting activity was shown to be related to visual, auditory, and general imagery, and to anticipated reward or relief from engaging in the activity. Implications for treatment of craving-related disorders are discussed in the light of these results and of other research indicating that interference with imagery can reduce the strength of craving. (shrink)

This essay analyzes the relations between Austrian Praxeology and sociology. It argues that Praxeology is not only a codification and ramification of pure market economics but also to some degree the Austrian school's variant or proxy of sociology. This argument particularly applies to Mises' Praxeology as the general theory of human action, with Weber's sociology understood as the science of social action, taken as Mises' acknowledged sociological source, inspiration or anticipation. The essay develops and substantiates the argument by identifying (...) certain sociological premises, concepts and observations in Mises' Praxeology, which are classified into the fields of general sociology, economic sociology and political sociology. The essay builds on and contributes to the growing economics and sociological literature on the relationship between Austrian economics and Weberian (and other) sociology. (shrink)

Competitive Governments, explores in a systematic way the hypothesis that governments are internally competitive, that they are competitive in their relations with each other and in their relations with other institutions in society which, like them, supply consuming households with goods and services. Breton contends that competition not only serves to bring the political system to an equilibrium, but it also leads to a revelation of the households' true demand functions for publicly provided goods and services and to the molding (...) of a link between the quantities and the qualities demanded and supplied and the tax prices paid for these goods and services. In the real world where information is costly, the links may not be first-best, but they will be efficient if competition is vigorous. (shrink)

This paper reviews Aristotle’s problematic relationship with modern economic theory. It argues that in terms of value and income distribution theory, Aristotle should probably be seen as a precursor to neither classical nor neoclassical economic thought. Indeed, there are strong arguments to be made that Aristotle’s views are completely at odds with all modern economic theory, since, among other things, he was not necessarily concerned with flexible market prices, opposed the use of money to (...) acquire more money, and did not think that the unintended consequences of human activity were generally beneficial. The paper argues however, that this interpretation goes too far. The Benthamite neoclassical theory of choice can be seen as a dumbing down of Aristotle’s theory, applicable to animals, not humans. Adam Smith and Karl Marx were deeply influenced by Aristotle’s work and both started their main economic works with Aristotle: Smith ultimately rejecting, and Marx ultimately developing Aristotle’s views of the use of money to acquire more money. Possibilities for the future development of a new Aristotelian Economics are explored. (shrink)

This is the final part of a series of two papers that have examined the conceptual development of the philosophical justifications for tyrannicide. While Part I focused on the classical, medieval, and liberal justifications for tyrannicide, Part II aims to provide the tentative outlines of a contemporary model of tyrannicide in world politics. It is contended that a reinvigorated conception of self-defence, when coupled with the modern understanding of universal human rights, may provide the foundation for the normative validity of (...) tyrannicide in contemporary world politics. (shrink)

Why is common priors are implicit or explicit in the vast majority of the differential information literature in economics and game theory? Why has the economic community been unwilling, in practice, to accept and actually use the idea of truly personal probabilities in much the same way that it did accept the idea of personal utility functions? After all, in, both the utilities and probabilities are derived separately for each decision maker. Why were the utilities accepted as personal, (...) and the probabilities not? (shrink)

We examine the most famous controversy between economists as a means of shedding fresh light on the current debate about economic methodology. By focusing on the controversy as the primary unit of analysis, we show how methodological considerations are but one of a whole set of stratagems strategically employed by each opponent. We argue that each opponent's preference for a particular kind of stratagems expresses his own specific scientific style (within the general scientific and cultural style of an age). (...) We also describe a dynamic dimension of the controversy, independent of the participants' intentions. Such a dimension is analysed in a "cycle" of the controversy, which begins with a well-defined issue and expands to additional topics, without reaching a "solution" to the initial issue. The definition and re-definition of the issue(s) at stake and of the difference between both participants is an essential and recurrent feature of such cycles; the conclusion of a cycle does not imply a real "closure" of the controversy, but only that each opponent has reached a satisfying degree of self-clarification. The controversy, thus, does not yield persuasion -- its ostensible aim. Rather, its "benefit" seems to lie in an unintended result -- clarification and deepening of contrasting approaches to the discipline -- due to its peculiar dynamics. In so far as the history of a discipline requires a reconstruction of such contrasts, it is indispensable for it to take into account the controversies where they emerge, and to view both the positive doctrines and the methodological posture of the contenders as parts of a wider framework, that is a scientific style. (shrink)

The doctrine of karma, as elaborated in the Hindu, Buddhist, and Jain religious traditions, offers a powerful explanatory account of the human predicament, and in particular of seemingly undeserved human suffering. Whitley R. P. Kaufman is right to point out that on some points, such as the suffering of children, the occurrence of natural disasters, and the possibility of universal salvation, the karma theory appears, initially at least, much more satisfactory than the attempts made to solve the perennial problem (...) of evil by writers working within the mainstream theistic traditions of Judaism, Christianity, and Islam .1 Kaufman, we think, is also correct to highlight the lack of critical analysis given by contemporary philosophers of religion to the theory of karma, at least in comparison with the voluminous body of work produced in recent years on the theistic problem of evil . Kaufman?s recent article in this journal, therefore, is to be welcomed as a step toward redressing this imbalance in the literature, and in the process helping to remove the Western theistic bias of much contemporary philosophy of religion. On the other hand, we think that Kaufman has unfortunately done little to further the general understanding of the doctrine of karma. (shrink)

A key issue in economic discourse today is the relation between economic behaviour and morality. Few would want to deny that human beings are in some sense moral or ethical creatures, but the devil is in the detail. Should we think of economic behaviour as an essentially amoral process – a process adequately characterised by a means-ends rationality – into which any number of subjective ethical concerns or orientations may be intruded to give a particular action its (...) determinate moral content? Or is it rather the case that our moral being runs deeper than this, in the sense that all of our behaviour – ‘economic’ or otherwise – is enabled or capacitated by a competence that is fundamentally ethical in character? With new analyses of the work of Hobbes and Smith, Dixon and Wilson offer a fresh approach to the debate surrounding economics and morality with a novel discussion of the self in economic theory. This book calls for a change in the way that the relation between economic behaviour and morality is understood – from an understanding of morality as a kind of preference that informs certain types of other-regarding behaviour, to an idea of morality as a competence that enables or, rather, conditions the possibility of all forms of human behaviour, other-regarding or not. Offering a new insight on homo economicus, this book will be of great interest to all those interested in the history of economics and of economic thought. (shrink)