Critique Of Neoclassical Economics Research Articles

Care economies—feminist contributions and debates in economic theory

This article focuses on feminist analyses and concepts of care, highlighting their potential for the development of a radical reconceptualization of “the economy” as opposed to traditional economic thought. It illustrates how feminist economic concepts of care correspond to feminist sociological and philosophical concepts. We begin by identifying some feminist economic perspectives and their contribution to the assessment, conceptualization and measurement of care as a form of reproductive labor and their critique of neoclassical economics. We then examine some feminist (economic) analyses of capitalist regimes of accumulation and the commodification of care that go beyond traditional economic thought. We conclude by showing how feminist economic conceptualizations of the kind suggested by Ina Praetorius (2015) could be a starting point for rethinking the economy and policy by putting care at their center.

Das Kapital Reinterpreted as a Basis for a Critique of Neoclassical Economics

Das Kapital Reinterpreted as a Basis for a Critique of Neoclassical Economics

The Making of the Institutional Theory of Social Costs: Discovering the K. W. Kapp and J. M. Clark Correspondence

AbstractThis article reconstructs the making of the often “overlooked” institutional theory of social costs based on the unexploited correspondence between John Maurice Clark and Karl William Kapp. The reconstruction demonstrates that the institutional argument on social costs was developed as a critique of neoclassical economics and of post‐WWII neoliberalism.

The Politics of Actually Existing Unsustainability: Human Flourishing in a Climate Changed, Carbon-Constrained World

Preface and Acknowledgements 1. Introduction 2. Vulnerability 3. Resilience, Transition and Creative Adaptability 4. A critique of neo-classical economics as a regime of 'truth': empire and emperors with no clothes 5. Green Political Economy I: Sufficiency and Security 6. Green Political Economy II: Solidarity and Sharing 7. Greening Civic Republicanism I 8. Greening Civic Republicanism II: Sustainability Service, a Green Republican Economy and Agonistic Politics 9. Conclusion: Dissident thinking in Turbulent Times

The enduring relevance of the model Platonism critique for economics and public policy

Abstract:The article briefly introduces Hans Albert and the basic elements of his critique of neoclassical economics as a form of ‘model Platonism’. The two most important elements of his general methodological critique of economics – namely the institutional vacuum inherent in much economic modelling and its unrealistic assumptions about behaviour – are introduced. It is argued that these specific critiques have been taken up with varying degrees of success in areas of economic research such as institutional economics and in behavioural and experimental research programmes. However, the fundamental methodological gist of his critique remains as pertinent to mainstream economics as it was when originally formulated. The influence of ‘model Platonic’ thinking remains pervasive in academia and also in public policy.

Bernard Hodgson’s Trojan Horse Critique of Neoclassical Economics and the Second Phase of the Empiricist Level of Analysis

This article examines and assesses Bernard Hodgson’s critique of the Neoclassical concept of rationality and its place in the literature. It is argued that Hodgson’s Trojan horse critique is superior to the others because it addresses the role of empiricist epistemology in reducing reason to instrumental rationality and consequent disappearance of the human subject of political economy. The second phase of the empiricist level of analysis reintroduces the capacities for ethical deliberation, self-determination, and the socio-historical conditions and institutional setting of the economic agent. Because Hodgson’s solutions presuppose empiricist terrain, they are arbitrary. This occurs because the fundamental problem of Neoclassical rationality is its ontology. Yet by introducing the human subject into economic theory, Hodgson’s solutions move onto an ontological terrain adequate for economic analysis of human subjects.

Critical realism, Marxism and the critique of neoclassical economics

This paper argues that while critical realist insights are important for heterodoxy, any engagement with the economic mainstream must remain faithful to Bhaskar’s original formulation with its explicit focus on ‘ideology critique’. The article proceeds by distinguishing Bhaskar’s more Marxian-inspired realism from the broadly heterodox variety of the ‘critical realism in economics’ (CRE) project. It then highlights the weaknesses of the CRE critique of the economic mainstream before positing an alternative critique in terms of ideology.

Thorstein Veblen (1857–1929): ‘The Limitations of Marginal Utility’ (1909)

One hundred years ago, Thorstein Veblen (1909b) published what is one of his most important journal articles. In ‘The Limitations of Marginal Utility’, he not only developed his critique of neoclassical economics, but also expanded his own methodological outlook.

Special Forum on Recent Interpretations of Keynes and the General Theory: The Post-Keynesian Economics Study Group – After 20 Years

First paragraphThe Post-Keynesian Economics Study Group (or PKSG, as it is usually abbreviated) was founded in 1988 by Philip Arestis and Victoria Chick with financial support from the UK Economic and Social Research Council (ESRC). The purpose of the Study Group is to encourage collaboration among scholars and students of Post-Keynesian economics, defined by the founders broadly »as a theoretical approach that drew upon the work of Keynes, Kalecki, Joan Robinson, Kaldor and Sraffa, and distinguished itself by its insistence that history, social structure and institutional practice be embodied in its theory and reflected in its policy recommendations« (Lee 2007a).The central feature of this approach has been further articulated by Arestis (1996) as the principle of effective demand, which can be approached from the perspectives of various intellectual traditions, including those of Keynes himself (closest to Marshall and the modern Neo-Classicals) and of Kalecki (drawing on Marx), informed by an emphasis on institutions deriving ultimately from Veblen. These traditions cover the contributions of Robinson and Kaldor, and Sraffa’s critique of Neo-Classical economics, although the positive Neo-Ricardian programme is best regarded as a separate school of thought (Arestis et al. 1999).

Austrian Economics and the Market Test Reexamined

The efficacy of the decentralized market process is perhaps the foremost contribution of Austrian economics. But if Austrians are correct about the performance of spontaneous order processes, the paucity of Austrian economists in academic positions seemingly undermines their methodological critique of neoclassical economics. Whether Austrian economics has faced a valid market test remains an issue of continuing controversy, as the exchange between Rosen (1997) and Yeager (1997) illustrates. 1 In this paper I examine when a market can be appropriately said to offer a “test” of products and whether Austrian economics has faced a meaningful market test. In essence this paper explores the question of inefficiency in spontaneous orders. Do all spontaneous order processes perform well? Economics catalogues causes of “market failure,” but the catalogue is based on end state or equilibrium theorizing, that is, comparing the end state attained by the market with Pareto efficient states. The theory of market failure has been criticized by many; from an Austrian perspective, end state welfare economics is irrelevant when the economy does not reach an equilibrium. But this leaves unanswered whether all spontaneous order processes perform well. If spontaneous orders necessarily perform well, the conclusion that the profession has judged Austrian economics inferior to neoclassical economics seems unavoidable. I begin by discussing when markets offer a test, since as Yeager (1997) points out, markets have never been defended as arbiters of truth or beauty. 2

Barbara Wooteen's lament for economics and vision of a social economics

The British social economist Barbara Wootton (1897–1988), engaged in a searching critique of the narrowness and abstraction of Neoclassical orthodoxy in herLament for Economics (1938), which was provoked by Robbins'Essay on the Nature and Significance of Economic Science, and in her reply to Hayek'sThe Road to Serfdom. Her participation in Beveridge's wartime “brains trust” resulted in her Fabian Society pamphlet,Full Employment (1943). This paper examines Wootton's critique of Neoclassical Economics; her vision of a broader, more realistic social economics; her attempts to apply that vision of social economics inThe Social Foundations of Wages Policy (1955), andIncomes Policy (1974), and parallels between her work and North American developments in social economics. *** DIRECT SUPPORT *** A03DH034 00003

In Through The Out Door: Critiquing The Internal Labour Market Concept

The institutional approach to studying labour markets has been hamstrung by its dual purpose of explaining labour markets and countering neoclassical labour market theory. We argue that institutional labour market theory should relinquish its usual opening critique of neoclassical economics and that it would benefit significantly by drawing from the disciplines of organisation theory and geography. Such an approach builds a conceptualisation of labour markets that does not use the concept of an external labour market drawn from neoclassical economics. We build our argument through an examination of the central institutionalist internal labour market concept. In doing so, we challenge the idea that labour markets can be understood in internal and external terms. Instead, we propose that the labour market at the level of a single employer is interconstitutive with the level of labour markets of employers collectively. Through this analysis, this article offers insights into related spatial challenges facing institutional labour market theory that centre on the organisation-environment relation.

Institutional Economics after One Century

Institutional economics, by any reckoning, has had its centenary. Alas, institutional economics is not what it once was. It has gone from being a more or less recognized part of the discipline and practice of economics to a marginalized heterodox status, and from being part of the mindset and work of many, if not most, economists to being the specialized school for some economists and latent in the work of some specialists in specialized fields. But for those content to actually do institutional economics, rather than use it as a vehicle for career enhancement, i.e., as a means of status emulation, it is alive and reasonably well, if not prosperous. Yet it has serious problems. Part of institutionalism's predicament derives from its treatment by non-institutionalist economists, treatment including being curtly dismissed, being misrepresented, being ignored, and being read out of the discipline. But some, if not much, of institutionalism's predicament derives from within, and it is this aspect of the situation that I address in this article. I approach the task from a position based on at least three foundations: as a committed and practicing institutionalist, as a historian of economic thought, and as an eclectic (and relativist) economist. Part 1 of this article summarizes my critique of neoclassical economics and my approach to the history of economic thought. I would urge application of both to the problem of the present predicament of institutional economics. Part 2, therefore, considers the internal sources of the predicament on such basis. Part 3 notes a hopeful sign. Part 4 recapitulates and extends my argument.

Fine tuning the Zelizer view

Fine and Lapavitsas accept my critique of neoclassical economics as well as my empirical findings, but too hastily reject the arguments underlyng both of them. Despite their complaints to the contrary, my work provides viable definitions of money and markets, offers a theoretically motivated research program, demonstrates the heterogeneity of money and markets, deals with standard economic processes, and addresses general theoretical issues. Within recent economic sociology, both 'context' and 'alternative' approaches improve on the stark choice between neoclassical economics and conventional Marxist political economy posed by Fine and Lapavitsas.

Sraffian Indeterminacy in General Equilibrium

The indeterminacy claim for competitive price systems made by Sraffa (1960) is examined by placing Sraffa's work in an intertemporal general equilibrium model. We show that indeterminacy occurs at a natural type of equilibrium. Moreover, the presence of linear activities instead of a differentiable technology is crucial and the indeterminacy is constructed, as in Sraffa, by fixing some or all of the economy's aggregate quantities. On the other hand, an extra condition, that some factors have inelastic excess demand is necessary, and, unlike Sraffa's model, relative prices must be allowed to vary through time. Sraffian indeterminacy and the generic finiteness of the number of equilibria are reconciled by showing that indeterminacy occurs at a measure-zero set of endowments. We use an overlapping-generations model to show that these endowments nevertheless arise systematically and that indeterminacy does not occur when relative prices are constant through time. Near the beginning of his Production of Commodities by Means of Commodities (1960), Sraffa specifies a system of equations that prices must obey if the capital invested in each sector of an economy is to earn the same rate of profit. The system contains one more unknown than equation, leading Sraffa to conclude that prices, and wage and interest rates in particular, are indeterminate. Sraffa's book has since been read as arguing that some outside, non-economic consideration must therefore set prices and the distribution of income. Part of the controversy the book has provoked is due to Sraffa's apparent agreement with the neoclassical emphasis on optimization and competitive markets. The standard Sraffian system of equations is nothing other than the first-order conditions that hold for price-taking, profit-maximizing firms using linear activities. But if Sraffa's assumptions are in accord with neoclassical theory, how can his assertions of indeterminacy be correct? I examine Sraffa's indeterminacy argument and his critique of neoclassical economics by embedding his equations in a general equilibrium model. As we will see, the indeterminacy claim, properly interpreted, correctly describes the equilibria with strictly positive prices. Moreover, the indeterminacy demonstrated here closely duplicates the indeterminacy Sraffa claimed. First, it is prices alone that are indeterminate. I follow Sraffa's striking procedure of fixing the quantities of goods produced: an infinity of (normalized) price vectors support a single vector of aggregate quantities. Second, Sraffa seemed to claim, and his advocates (e.g. Robinson (1961)) have certainly claimed that his book is a critique of marginal productivity theory. Correspondingly, indeterminacy in the present model hinges on marginal products not being everywhere well-defined when there are linear activities; with smooth production sets, our indeterminacy arguments do not work. Third, the dimension of the indeterminacy I demonstrate matches Sraffa's accounting of the dimension of indeterminacy.

Contemporary Political Economy: Common and Contested Terrain

This paper analyzes the nature of contemporary political economy. The attempt to distinguish political economy from orthodox economics according to the role played by value‐judgements or policy prescriptions is rejected as misleading. Instead the principal concerns of political economy are identified by reference to six contributory currents of thought, ranging from the critique of neoclassical economics and the reconstruction of Keynesian economics, through the development of Marxist and institutional analyses, to the influence of feminism and environmentalism. The paper concludes with some comments on the place of political economy in the university curriculum.

The Literature of Economics: The Case of Berle and Means

THERE are not many books fifty years old whose central argument is identified for modern economists simply by naming the work, but Berle and Means's The Modern Corporation and Private Property is surely one. Every schoolboy, as Macaulay would say, knows that they discovered or asserted or proved or were otherwise joined to the proposition that ownership and control have been separated in the large corporation. Moreover this separation had large, but not easily recalled, effects on the conduct of corporate enterprise. This essay will examine the reception of this book, particularly by the economics profession, in its first decade. Our interest will be not so much in the novelty or validity of the book's message as in how it was understood and received. The process by which a proposition of great potential scientific and political significance gets established in a discipline is fascinatingly mysterious. Our investigation will support the view that doctrines and theories congenial to an intellectual milieu are accepted quickly and widely, although not necessarily as uncritically as the work of Berle and Means was accepted.