Institutionalism and Economic Theory
Saturday, Jan. 7, 2017 2:30 PM – 4:30 PM
Swissotel Chicago, St Gallen 2
- Chair: William Waller, Hobart and William Smith Colleges
Rethinking the Foundation of the Original Institutional Economics Policy and Reform Program: Reactions to Leonard’s “Illiberal Reformers”
AbstractThorstein Veblen, John R. Commons and other original institutional economists argued for the interests of the common people against the power of vested interests in politics and business. Against this backdrop, a new book argues that, in fact, these same economists were actually “illiberal” and only promoted the interests of certain groups such as Anglo-Saxon men and were in fact against the progression of minority populations, women and even the disabled. But Leonard’s argument is extended beyond the point that these economists were “illiberal”, and that in fact their entire reform program related to the role of government in the economy and the creation of the administrative state is essentially defunct. Leonard wrote at the end of the book’s prologue the most telling statement, “expertise in the service of the administrative state, what progressives call social control, has survived the discredited notions once used to uphold it”. This paper responds to this book via a direct critique of the arguments presented therein. We argue that the founders view on these issues are at least partially taken out of context and further that even where some of their views would be rejected by today’s institutional economists that that does not mean the entire reform project is be rejected. This issue has contemporary relevance as Leonard recently penned an editorial in the L.A. Times arguing that the minimum wage is a poor policy based partially on his historical arguments.
Neuro-Economic: Sociological and Psychological Concepts of Economic Analysis
AbstractThe paper will analyze economic analysis and the assumptions of Rationality. The paper will point out the fact that such a study and assumption overlooks Sociological and Psychological studies in those fields that relate to economic behavior; and the reactions to economic events and to economic policy changes in relation to those economic events. The analysis will deal with studies by the Federal Reserve Bank and from psychological and sociological studies that deal with economic matters and how we as humans actually react to events and to shocks such as the Crisis of 2008 and the policy changes relating to such a crisis and its effects upon our reactions to it that may or may not fit into the Rationality analysis of Economists. The conclusion is that the reactions to such events is much more complicated than economic theory assumes.
Save Us From Something! An Analysis of the 2016 United States Presidential Primary Election
AbstractThis paper examines the 2016 Republican presidential primary vote for Donald Trump. Trump’s primary campaign rhetoric emphasized the need to make America great again and proposed that he is the best candidate to make this happen. Counties with older, less educated, and economically stressed populations tended to give strong support to Trump in the primary suggesting that he is seen as something of a messiah candidate. Conclusions are based on the analysis of data from 2238 counties or county equivalents in the 35 states that held primary elections and held both Republican and Democratic primaries on the same day.
Economic Possibilities for our Grandchildren in the Light of the Vested Interests and the Common Man
AbstractKeynes short essay Economic Possibilities for our Grandchildren (1930) has been much debated for the strong views it took on a potentially future transition whereby our societies of work and investment (to meet their basic needs) would shift to societies of leisure where the economic problem have been solved. Interestingly it is much in Keynes view a matter of knowledge and beliefs for societies to reckon at some historical point that saving and investment by some class of people are not specifically needed anymore, the economies having reached some stationary state where all basic needs are met. The societies can then get rid of capitalist classes and turn to a new challenge : how to fill properly this life of leisure , how to recover some lost art of life. Such strong assessment has been much debated, interestingly by economists of diverse approaches. It remains very appealing to read Keynes ‘essay through the glasses that Thorstein Veblen (1920) offered a decade before. Veblen ‘s essay is all about changes in knowledge and belief and the conditions for such changes. Moreover it takes care to ground its arguments in historical phases. This focus does help to position Keynes essay in view of some contemporary debates regarding structural changes in our modern economies such as secular stagnation, circular economies, unequal societies, leisure economies, creative industries... The paper will try, using the lens of Veblen work, to revisit the much debated essay of Keynes.
- B4 - Economic Methodology
- B5 - Current Heterodox Approaches