This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. ASSA Annual Meeting
  3. 2025
  4. Program
  5. The State, Capitalism & Circular
« Back to Results

The State, Capitalism & Circular

Paper Session

Sunday, Jan. 5, 2025 1:00 PM - 3:00 PM (PST)

The Marker Union Square San Francisco, Spade II
Hosted By: Association for Evolutionary Economics
  • Chair: Steven Pressman, New School University

The Shifting Equilibrium Strategy of Economic Development

Devin Rafferty
,
Saint Peter’s University

Abstract

conomic development is an interdisciplinary process by which nation-states transform their productive structures to improve the population’s general living standards. Overall, this is a long-run process, though it has historically been achieved by policymakers that engineer interconnected short-run demand targeting sequences which ultimately produce the desired long-run structural change. Moreover, the conditions of the real-world feature socially-influenced individuals who continually formulate their expectations and execute their plans of action in real-time and through historical time, which makes all economies evolutionary, path-dependent, and disequilibrium systems in which the level and composition of short-run activity simply jumps from point to point, just as Keynes captured in his shifting equilibrium framework. Therefore, on the one hand, there is the need for policymakers to ensure that the induced investment projects necessary for the long-run transformation of the productive structure materializes in the desired areas and activities, and yet, as the economy shifts from short-run point to point, there is a simultaneous, ongoing need to redirect this process and make sure that its targets are appropriate, as well as to identify how the governing bodies themselves can possess the capabilities necessary for performing these functions–which is all the more important given the severity of the multi-front, interrelated climate crises that the developing world faces. As a result, this essay represents an attempt to describe the shifting equilibrium strategy of economic development.

Money as an Institution of International Capitalism

Oleksandr Valchyshen
,
University of Missouri-Kansas City and Bard College

Abstract

In a modern-day environment, the everlasting societal quest for sustainability arrives at some point at such observable phenomena as `polycrisis' (Mackenzie and Sahay 2024) and `systemic chaos' (Galanis, Koutny, and Weber 2024). Institutional economics provides guidance on how to decipher such complexity. A prior condition is termed simply by (Dillard 1987) as analyzing the kind of world in which we actually live. Then, one needs to put money at the center of economic theory, instead of an afterthought in order to obtain the correct picture (Commons 1923). All these points are key. To arrive at this stage of socio-economic analysis, this paper proposes an update to the seminal work Dillard (1987) on money as an institution by introducing the international dimension. It builds upon key insights by Commons (1936) on a single transaction, private property and value. It also connects the Commons' way of thinking with the conceptualization of a payment by Mitchell Innes (1913). As an intermediary conclusion, the paper argues to retire traditional and extremely abstract metaphors of motion the economists and scientists of other elds rely upon, while explaining the international monetary matters (such as in Clark (2005), Koepke (2019), Forbes and Warnock (2021), Swartz and Westermeier (2023)). Instead, an alternative conceptualization is required and proposed to have the correct picture  the one that describes an actual transaction. The ultimate point of this paper is to connect back to the Commons (1925)'s idea of reasonable stabilization of capitalism, which nowadays has an international spread out, crossing continents, time zones and jurisdictions.

What is Financial Literacy?

Steven Pressman
,
New School University
Robert Haywood Scott III
,
Monmouth University

Abstract

This paper tests the relationship between financial literacy knowledge and outcomes such as saving, investing, and income. We use the financial literacy questions in the Federal Reserve’s Survey of Consumer Finances (SCF) developed by Annamaria Lusardi and Olivia Mitchell known as the “big three” to study what characteristics are associated with their definition of financially literate. The SCF asks the big three, allowing us to analyze financial knowledge among various households compared to their financial health. Do the big three measure financial literacy or are they correlated with other factors such as education, age, or race? The standard belief among financial literacy proponents is that higher financial literacy rates will ipso facto lead to better financial decisions. Financial literacy is knowing how to live within one’s financial means, save for the future, and provide for household members without accruing significant debt. We use the SCF datasets to test a multinominal logistic regression on the relationship between the “big three” and financial health controlling for factors likely to affect financial health, such as education. We measure financial health using retirement savings, general savings, home equity, debt-to-income, investments, and liabilities. Taken collectively, these financial outcomes provide a comprehensive view of financial health. We assert that financial literacy as measured by the big three is an oversimplification of a complex issue. We want to identify those institutional factors that enable people to succeed financially.
JEL Classifications
  • P0 - General
  • G0 - General