Pub Date : 2021-04-03DOI: 10.1080/08911916.2021.1944592
Jeronim Capaldo
Abstract A reality check on dynamic, stochastic general equilibrium (DSGE) models was overdue and Servaas Storm has filled the void. His sharp, complete, yet succinct analysis of these models’ shortcomings is a stepping stone for macroeconomists who want to move on. Macroeconomic policy has been captive to “evil twins,” DSGE and computable general equilibrium (CGE) models, inheriting their disconnect from some of reality’s most pressing problems. The latest example is the Italian government’s plan to recover from the COVID-19 crisis, which showcases these models’ inability to account for demand-driven growth. Better models exist but require more investment to break the blockade of current expert opinion.
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Pub Date : 2021-04-03DOI: 10.1080/08911916.2021.1944593
D. Colander
Abstract Dynamic stochastic general equilibrium (DSGE) macro theory has lots of problems, many of them nicely listed and outlined in Servaas Storm’s article, “Cordon of Conformity: Why DSGE Models Are Not the Future of Macroeconomics.” Recognition of those fallacies is useful reading, but is unlikely to change the current state of macro theory, which is deeply entangled with DSGE elements. A major reason why is that the arguments for macroeconomic intervention versus nonintervention are, to a large degree, not based on macro theory. They are based on moral, empirical, and institutional judgements that extend far beyond economics. Neither critics nor DSGE economists discuss them, and both allow macro theory to hide those judgments.
{"title":"Does Macroeconomics Have a DSGE Future?","authors":"D. Colander","doi":"10.1080/08911916.2021.1944593","DOIUrl":"https://doi.org/10.1080/08911916.2021.1944593","url":null,"abstract":"Abstract Dynamic stochastic general equilibrium (DSGE) macro theory has lots of problems, many of them nicely listed and outlined in Servaas Storm’s article, “Cordon of Conformity: Why DSGE Models Are Not the Future of Macroeconomics.” Recognition of those fallacies is useful reading, but is unlikely to change the current state of macro theory, which is deeply entangled with DSGE elements. A major reason why is that the arguments for macroeconomic intervention versus nonintervention are, to a large degree, not based on macro theory. They are based on moral, empirical, and institutional judgements that extend far beyond economics. Neither critics nor DSGE economists discuss them, and both allow macro theory to hide those judgments.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"50 1","pages":"99 - 102"},"PeriodicalIF":1.2,"publicationDate":"2021-04-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"41795873","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-04-03DOI: 10.1080/08911916.2021.1942963
Elissa Braunstein, S. Seguino, Levi Altringer
Abstract Do investments in social reproduction, or the time and commodities that it takes to produce and maintain the labor force, actually matter for the rate of economic growth? Using a Kaleckian macroeconomic model that incorporates gender and care provisioning, this article seeks to empirically evaluate this question. With panel data for a set of 121 countries between 1991 and 2015, the article uses principal component analysis to generate estimates of social reproduction regime by country, and then applies these estimates in growth regression analysis. Results indicate that the pressure on women’s care time that comes with their increasing labor-force participation—absent strong social and more gender-egalitarian supports for care provisioning—compromises investment and growth. In economies where those supports for social reproduction exist, the increasingly outward-oriented and market-driven macro structures and policies that prevail across a variety of countries, including those associated with financialization, are shown to constrain investment in human capacities and long-run productivity growth. In mutual social reproduction regimes, greater gender equality in the labor market and in the distribution of responsibilities for care also stimulates economic growth, while regimes built on the exploitation of women’s labor in these domains generate lower growth.
{"title":"Estimating the Role of Social Reproduction in Economic Growth","authors":"Elissa Braunstein, S. Seguino, Levi Altringer","doi":"10.1080/08911916.2021.1942963","DOIUrl":"https://doi.org/10.1080/08911916.2021.1942963","url":null,"abstract":"Abstract Do investments in social reproduction, or the time and commodities that it takes to produce and maintain the labor force, actually matter for the rate of economic growth? Using a Kaleckian macroeconomic model that incorporates gender and care provisioning, this article seeks to empirically evaluate this question. With panel data for a set of 121 countries between 1991 and 2015, the article uses principal component analysis to generate estimates of social reproduction regime by country, and then applies these estimates in growth regression analysis. Results indicate that the pressure on women’s care time that comes with their increasing labor-force participation—absent strong social and more gender-egalitarian supports for care provisioning—compromises investment and growth. In economies where those supports for social reproduction exist, the increasingly outward-oriented and market-driven macro structures and policies that prevail across a variety of countries, including those associated with financialization, are shown to constrain investment in human capacities and long-run productivity growth. In mutual social reproduction regimes, greater gender equality in the labor market and in the distribution of responsibilities for care also stimulates economic growth, while regimes built on the exploitation of women’s labor in these domains generate lower growth.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"50 1","pages":"143 - 164"},"PeriodicalIF":1.2,"publicationDate":"2021-04-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48360022","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-02-23DOI: 10.1080/08911916.2021.1910766
G. Vidal
Eugenia Correa was a Professor of the Graduate School of Economics Faculty of the Universidad Nacional Aut onoma de M exico (UNAM). She passed away on March 13, 2021 with a large number of projects in progress as part of her research agenda. From the UNAM as her base, she achieved a remarkable amount of research work. As an example, I will only consider a year of academic labors. In January 2000, she participated at the Allied Social Science Association (ASSA) meetings in Boston, presenting the paper “Currency Board or Dollar Adoption? A NAFTA Monetary Cooperation for Economic Development.” Months later, at the 2000 meetings of IAFFE (International Association for Feminist Economics), she presented “Mexico: Women and Full Employment.” In October of that same year, she also participated in the Second International Colloquium of the Celso Furtado Euro-Latin American Network for Research on Development, with the paper “New International Financial Architecture, Conglomerates and Developing Countries.” Another contribution was her presentation at the Conference organized by the Latin American and Caribbean Economic Association (LACEA), in Rio de Janeiro, in October of that year, entitled “The Mexican Financial Crisis: Consequences on the Local Currency.” In this same year, papers were also presented at various meetings held in Mexico by the Federation of University Women, on various topics related to gender; a paper was presented regarding international financial flows and their regulation at a conference organized by the Institute of Legal Research of the UNAM; and several more presentations were given on various topics related to the changes to be carried out in order to achieve forms of international finance compatible with the development of Latin American economies, held at various institutes of the UNAM and other universities in the country. The results presented by Eugenia Correa in that year, as with many others in her long career, show her very diverse research interests and her broad understanding of economics as a social science in which institutions, social regulations and even cultural roles are elements to be considered. She was a notable economist who understood and explained in depth that in this research area there are no automatisms, and few performances and behaviors typical of a natural science. In that sense, she was a consistent and brilliant heterodox economist who constructs her reflections but also takes into account the approaches of the orthodoxy, or the mainstream. Therefore, initiatives such as the one that was brought together in three issues of the journal Comercio Exterior on the occasion of its 50th anniversary, in December 2000 and January and February 2001, to review the economic thought of the 20th Century are not surprising. Among the authors considered are Friedman and Hayek. But also, Harrod and Leontief; also considered are Schumpeter, Kalecki, Keynes, Perroux, Minsky, Furtado and other Latin American structural
Eugenia Correa是国立出口经济大学（UNAM）经济学院研究生院的教授。她于2021年3月13日去世，作为她的研究议程的一部分，大量项目正在进行中。以UNAM为基地，她完成了大量的研究工作。举个例子，我只考虑一年的学术劳动。2000年1月，她参加了在波士顿举行的联合社会科学协会（ASSA）会议，发表了论文《货币发行局还是美元采用？北美自由贸易区货币合作促进经济发展》。几个月后，在国际女权主义经济学协会（IAFFE）2000年会议上，她发表了《墨西哥：妇女与充分就业》。同年10月，她还参加了欧洲-拉丁美洲发展研究网络第二次国际学术讨论会，发表了题为“新的国际金融结构、集团和发展中国家”的论文，同年10月，题为“墨西哥金融危机：对当地货币的影响”。同年，大学妇女联合会还在墨西哥举行的各种会议上提交了关于性别问题的论文；在联安特派团法律研究所组织的一次会议上提交了一份关于国际资金流动及其管制的文件；在联安特派团各研究所和该国其他大学举行的关于为实现与拉丁美洲经济发展相适应的国际金融形式而进行的改革的各种专题的专题介绍会上，又作了几次专题介绍。Eugenia Correa在那一年发表的研究结果，以及她漫长职业生涯中的许多其他研究结果，表明了她非常多样化的研究兴趣，以及她对经济学作为一门社会科学的广泛理解，在这门社会科学中，制度、社会法规甚至文化角色都是需要考虑的因素。她是一位著名的经济学家，她深入理解并解释说，在这个研究领域，没有自动现象，也没有自然科学的典型表现和行为。从这个意义上说，她是一位始终如一、才华横溢的异端经济学家，她构建了自己的思考，但也考虑到了正统或主流的方法。因此，在2000年12月和2001年1月和2月《外部商业》杂志50周年之际，在三期杂志上发表了回顾20世纪经济思想的倡议，这并不奇怪。被考虑的作者包括弗里德曼和哈耶克。还有哈罗德和莱昂蒂夫；也被认为是熊彼特，卡莱基，凯恩斯，佩鲁，明斯基，弗塔多和其他拉丁美洲结构主义作家。在这些撰写文章的人中，还有著名的研究人员，如保罗·戴维森、阿兰·帕格斯、兰德尔·雷、奥克塔维奥·罗德里格斯和塞缪尔·利希滕泽恩。在随后的几年里，组织了类似的倡议，以促进对被认为与经济学领域相关的思想的讨论。特别相关的是财政与金融经济研讨会，这是一项与Alicia Gir on和Patricia Rodrıguez一起组织了20多年的年度活动。Seminario早期的一个显著成果是四卷本
{"title":"Eugenia Correa In Memoriam (1954–2021)","authors":"G. Vidal","doi":"10.1080/08911916.2021.1910766","DOIUrl":"https://doi.org/10.1080/08911916.2021.1910766","url":null,"abstract":"Eugenia Correa was a Professor of the Graduate School of Economics Faculty of the Universidad Nacional Aut onoma de M exico (UNAM). She passed away on March 13, 2021 with a large number of projects in progress as part of her research agenda. From the UNAM as her base, she achieved a remarkable amount of research work. As an example, I will only consider a year of academic labors. In January 2000, she participated at the Allied Social Science Association (ASSA) meetings in Boston, presenting the paper “Currency Board or Dollar Adoption? A NAFTA Monetary Cooperation for Economic Development.” Months later, at the 2000 meetings of IAFFE (International Association for Feminist Economics), she presented “Mexico: Women and Full Employment.” In October of that same year, she also participated in the Second International Colloquium of the Celso Furtado Euro-Latin American Network for Research on Development, with the paper “New International Financial Architecture, Conglomerates and Developing Countries.” Another contribution was her presentation at the Conference organized by the Latin American and Caribbean Economic Association (LACEA), in Rio de Janeiro, in October of that year, entitled “The Mexican Financial Crisis: Consequences on the Local Currency.” In this same year, papers were also presented at various meetings held in Mexico by the Federation of University Women, on various topics related to gender; a paper was presented regarding international financial flows and their regulation at a conference organized by the Institute of Legal Research of the UNAM; and several more presentations were given on various topics related to the changes to be carried out in order to achieve forms of international finance compatible with the development of Latin American economies, held at various institutes of the UNAM and other universities in the country. The results presented by Eugenia Correa in that year, as with many others in her long career, show her very diverse research interests and her broad understanding of economics as a social science in which institutions, social regulations and even cultural roles are elements to be considered. She was a notable economist who understood and explained in depth that in this research area there are no automatisms, and few performances and behaviors typical of a natural science. In that sense, she was a consistent and brilliant heterodox economist who constructs her reflections but also takes into account the approaches of the orthodoxy, or the mainstream. Therefore, initiatives such as the one that was brought together in three issues of the journal Comercio Exterior on the occasion of its 50th anniversary, in December 2000 and January and February 2001, to review the economic thought of the 20th Century are not surprising. Among the authors considered are Friedman and Hayek. But also, Harrod and Leontief; also considered are Schumpeter, Kalecki, Keynes, Perroux, Minsky, Furtado and other Latin American structural","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"50 1","pages":"2 - 4"},"PeriodicalIF":1.2,"publicationDate":"2021-02-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1080/08911916.2021.1910766","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47650993","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-02-23DOI: 10.1080/08911916.2021.1894826
George H. Blackford
Abstract The purpose of this article is to explain how the failure of neoclassical economics to embrace Keynes’ arguments with regard to the long-run tendency of the economic system to trend toward stagnation and to ignore the problems endemic in the economics of debt facilitated the adoption of economic policies in the United States that contributed to the economic, political, and social problems we face today.
{"title":"Keynes on Economic Stagnation and Debt","authors":"George H. Blackford","doi":"10.1080/08911916.2021.1894826","DOIUrl":"https://doi.org/10.1080/08911916.2021.1894826","url":null,"abstract":"Abstract The purpose of this article is to explain how the failure of neoclassical economics to embrace Keynes’ arguments with regard to the long-run tendency of the economic system to trend toward stagnation and to ignore the problems endemic in the economics of debt facilitated the adoption of economic policies in the United States that contributed to the economic, political, and social problems we face today.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"50 1","pages":"28 - 43"},"PeriodicalIF":1.2,"publicationDate":"2021-02-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1080/08911916.2021.1894826","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42933479","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-02-23DOI: 10.1080/08911916.2021.1894828
D. Guizzo
Abstract This article examines Michel Foucault’s contributions to the study of power in the history of political economy. It employs Foucault’s readings on economic thought to investigate two moments in the history of political economy: classical political economy and Keynesian economics, in which economic reasoning and practice affected the creation and dissemination of power relations in the social realm. By reconsidering the ontological dynamics that encompass the modern role of the state, economic policies and civil society, the article explores how power displays a changing face in light of different discursive and non-discursive elements throughout the history of political economy, in which “economic knowledge” and “scientific discourses” are reconceived as political apparatuses. The article concludes how a closer look into Foucault’s historical ontology allows for a reassessment of the field of action of political economy, showing its consequences in the political field, in the interpretation of historical facts and in the analysis of power/truth. More specifically, how moments in the history of political economy can be reconsidered not simply as systems of economic ideas, but as political apparatuses that create power.
{"title":"Reassessing Foucault: Power in the History of Political Economy","authors":"D. Guizzo","doi":"10.1080/08911916.2021.1894828","DOIUrl":"https://doi.org/10.1080/08911916.2021.1894828","url":null,"abstract":"Abstract This article examines Michel Foucault’s contributions to the study of power in the history of political economy. It employs Foucault’s readings on economic thought to investigate two moments in the history of political economy: classical political economy and Keynesian economics, in which economic reasoning and practice affected the creation and dissemination of power relations in the social realm. By reconsidering the ontological dynamics that encompass the modern role of the state, economic policies and civil society, the article explores how power displays a changing face in light of different discursive and non-discursive elements throughout the history of political economy, in which “economic knowledge” and “scientific discourses” are reconceived as political apparatuses. The article concludes how a closer look into Foucault’s historical ontology allows for a reassessment of the field of action of political economy, showing its consequences in the political field, in the interpretation of historical facts and in the analysis of power/truth. More specifically, how moments in the history of political economy can be reconsidered not simply as systems of economic ideas, but as political apparatuses that create power.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"50 1","pages":"60 - 74"},"PeriodicalIF":1.2,"publicationDate":"2021-02-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1080/08911916.2021.1894828","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43238231","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-02-23DOI: 10.1080/08911916.2021.1894827
Fernanda Feil, Carmem Feijó
Abstract Since the 2007/2008 financial crisis, State-owned financial institutions (SFIs) have reinforced their essentiality for countercyclical actions. This article argues that SFIs are vital for the development process of peripheral countries not only because they correct market failures and have the prerogative to act countercyclically but they have the ability to be instruments of public policy. SFIs, specifically development banks, are essential to promote peripheral countries' catching up since they can operate as part of the State toolkit. To do so, they must act in line with other government policies—fiscal, monetary, foreign exchange, and industrial. Credit policy through development banks can be seen as a permanent device for managing aggregate demand.
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Pub Date : 2021-02-14DOI: 10.1080/08911916.2021.1929582
Servaas Storm
Abstract The Rebuilding Macroeconomic Theory Project, led by David Vines and Samuel Wills (2020), is an important, albeit long overdue, initiative to rethink a failing mainstream macroeconomics. Professors Vines and Wills, who must be congratulated for stepping up to the challenge of trying to make mainstream macroeconomics relevant again, call for a new multiple-equilibrium and diverse (MEADE) paradigm for macroeconomics. Their idea is to start with simple models, ideally two-dimensional sketches, that explain mechanisms that can cause multiple equilibria. These mechanisms should then be incorporated into larger DSGE models in a new, multiple-equilibrium synthesis – to see how the fundamental pieces of the economy fit together, subject to it being “properly micro-founded”. This paper argues that the MEADE paradigm is bound to fail, because it maintains the DSGE model as the unifying framework at the center of macroeconomic analysis. The paper reviews 10 fundamental weaknesses inherent in DSGE models which make these models irreparably useless for macroeconomic policy analysis. Mainstream macroeconomics must put DSGE models, once and for all, in the Museum of Implausible Economic Models – and learn important lessons from non-DSGE macroeconomic approaches.
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Pub Date : 2021-01-20DOI: 10.1080/08911916.2021.1920242
L. Taylor, Nelson H. Barbosa-Filho
Abstract Recognizing that inflation of the value of output and its costs of production must be equal, we focus on a cost-based macroeconomic structuralist approach in contrast to micro-oriented monetarist analysis. For decades the import and profit shares of cost have risen, while the wage share has declined to around 50% with money wage increases lagging the sum of growth rates of prices and productivity. Conflicting claims to income are the underlying source of inflationary pressure. Contemporary structuralist theory suggests that conflicting income claims set the inflation rate. Firms can mark up costs but workers have latent bargaining power over the labor share that they can exercise. Import costs and policy repercussions complicate the picture, but a simple vector error correction model and visual analysis suggest that money wages would have to grow 1% point faster than prices plus productivity for several years if the Fed is to meet a 3% inflation target. The results pose a Biden policy trilemma: (i) the only path toward a more egalitarian size distribution of income is through a rising labor share (money wage growth exceeds price plus productivity growth), (ii) which would provoke faster inflation with feedback to rising interest rates, and (iii) the resulting asset price deflation likely facing political resistance from Wall Street and affluent households.
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