Microeconomic Agents Research Articles

Философия микроэкономики: ключевые тенденции XXI в.

The article analyzes the current key philosophical trends in academic publications on microeconomics. The author investigates new sense that economists imply into traditional methodological grounds of Microeconomics. Based on classical marginalist microeconomic theory, contemporary Russian and World economists introduce new meanings and new interpretations into such important aspects of Microeconomics as microeconomic agents, choice and limitations for producers and consumers, market interactions and competition, time and space of microeconomic phenomena. New methodological grounds of Microeconomics in the sphere of decision-making are analysed on the ground of content-analysis. The process of economic choice in new conditions of the 21st century is based on deliberate consumption of economic goods and thoughtful limitations for time, place and number of alternatives when decision is made. Maximization of utility as the goal of behavior of a rational individual is replaced by the criterion of satisfaction and happiness which now form important elements of microeconomic analysis. New approaches to microeconomic models are formed on the ground of mathematical theories of dynamic chaos and nonlinear processes that allow to forecast more precisely microeconomic events in the era of turbulence. Stochastic concepts and differentiated games take the place of traditional statistical strict determinism of microeconomic theories and uncertainty acquires new depth as a fundamental pattern of functioning of microeconomic processes. The article specifies the motives and goals of individual and collective agents acting at micro level. Thus microeconomics of the 21st century has reconsidered its key philosophical grounds, which would contribute to a new paradigm of Microeconomic Analysis.

Organisation management modern methods based on a value-oriented approach

The author outlined a microeconomic agents role in the connections system in the macroeconomic space; explored the changes features in the Russian organisation at different stages of the country’s development in conjunction with changes in the values of the era; revealed the modern economic agent specifics, his worldview and value orientations; established the transformation process causal relationship of the modern economic space and the challenges facing the organisation; justified the need to take into account the stakeholder groups values in management; systematised organisation management methods based on a value-based approach. The article used evolutionary and historical, cause-and-effect research methods, the analysis and synthesis method, scientific abstraction method. The result of the study is the proposed managing methods in a modern organisation based on a value-oriented approach.

Разработка социальной политики на основе сочетания агент-ориентированного и межотраслевого подходов

The article proposes methodological approach for assessing the consequences of state social policy based on an extended agent-based spatial model with a detailed representation of the reaction of agents to changes in social transfers and taxation as the instruments of government policy. Optimization of territorial social policy is ensured by maximizing the iso-elastic function of social welfare (FSW), based on the individual utility functions of households and taking into account the degree of rejection of social inequality. Structural changes resulting from public policy are analyzed by aggregating the decisions of microeconomic agents and calculating the inputoutput balance table, including through a visual representation in the fourth quadrant of redistribution processes when transfers and taxes change. The results of experimental calculations show that at each level of the coefficient of rejection of inequality for both transfers and taxes, local maxima arise that correspond to the optimal levels of transfers and taxes and form monotonically decreasing iso-optimal curves depending on an increase in either the share of transfers or the level of taxation. The proposed approach to the formalization of ideas about the ratio of efficiency and fairness in the construction of FSW provides an opportunity to choose optimal solutions to justify an agent-based social policy.

THE ERA OF METAMODERNISM AND ITS IMPACT ON THE MODEL OF INTERACTION OF AGRARIAN ENTERPRISES

The period of the change of the era of postmodernism to metamodernism (metamodern) has been considered. The features of metamodernism, as the ambiguous orientation of philosophical and worldview concepts and its impact on the economic space of different levels of the hierarchy have been revealed. It has been emphasized, that the consequences of the metamodern era especially sharply reflected in the Russian economy of the 1990s, since the systemic ties that developed during the modern and postmodern periods were destroyed due to political transformations and the import of liberal institutions into the country’s economy. The level of a microeconomic agent on the example of enterprises in the agricultural sector has been reviewed. The stages of evolution of the development of agricultural enterprises have been identified. The transformation of the interaction model of agricultural enterprises with other microeconomic agents in the era of metamodernism has been traced.

SYMBIOTIC RELATIONSHIP BETWEEN A HEALTHY POPULATION AND A SUSTAINABLE ECONOMY: FINANCIAL PERFORMANCE OF JULPHAR GULF PHARMACEUTICAL INDUSTRIES

Redefining the variables of macroeconomics requires the evaluation of the vital role the healthcare industry plays as an economic agent. The pharmaceutical industry constitutes a vital part of the healthcare industry. In this study, the evaluation of the performance of Julphar examined viability of such an agent. A 5-year financial ratio analysis was conducted based on the company’s 5-year annual reports. The analyzed ratios were assets utilization, net profit margin, debt utilization, and the profitability ratios ROA and ROE. The overall findings showed that Julphar assets were underutilized meaning that their productivity is not optimal. ROA and ROE dropped-down consecutively, which means that the company’s profitability was in question given its high debt-financing and a continuous increase in total operating expenses. This performance can affect the national and regional economic stability. It is recommended that Julphar scales down financing, debt acquisitions, and reduces its operating expenses while increasing its productivity by way of optimal assets utilization and redefined market segmentation. Market-driven projects are seen as the solution to most of its problems. Due to its position, Julphar plays important role in the national and regional economy. Future research should include other microeconomic agents such as micro-foundations in order to determine the far-reaching effects of financial performance on the economy. Keywords: Financial Performance, Healthcare, Economy, Pharmaceutical Industry, Macroeconomics JEL Classifications: G32; G49; I15; O11 DOI: https://doi.org/10.32479/ijefi.9406

Structural levels of the national economic system: management aspect

The organizational structure of the national economy, its internal levels (macro, meso and micro) has been analyzed in the article. The problems of the content of the concept of “economy”, segmented it into material and social components, have been identified. Attention has been focused on the negative aspects of the globalization of the world economy, based on the main provisions of the neoclassical paradigm. It has been noted, that to ensure the socio-economic integrity of the national economy, it is necessary to transform the generic state of society into a centrally-organized.According to the authors, to implement the transformation of the socio-economic space into an integrated socioeconomic system, it is necessary to coordinate three hierarchically subordinate levels: macro, meso, and microeconomic agents. The macroeconomic agent forms subject relations between all hierarchical levels, which require a high level of government: it cannot be a command economy, since this strategy of economic development paralyzes competition and free enterprise, but there can be no purely market economy, because the “invisible hand of the market” unable to ensure sustainable harmonious development of the economy without government intervention.It has been concluded about the need for an integrated nature of management of the Russian economy and the tasks for improving the system of management of the Russian economy have been determined. It is emphasized, that at the present stage, the greatest attention should be paid to the issues of improving the management of the mesostructure of the Russian economy – the development of industries and regions, since at the moment this level of the economy is paid fragmentary attention. The analysis has been carried out using general scientific methods: the method of abstraction, historical research methods; formalization method, reconstruction method; based on a systematic approach using the method of forecasting.

Endogenous business cycles caused by nonconvex costs and interactions

This paper shows that endogenous business cycles (inventory cycles) arise from a combination of nonconvex costs and economic interactions among firms. At the micro level, firm behavior is characterized by lumpiness, and the standard production-smoothing theory is empirically rejected. To account for this, a nonconvex cost function is assumed in our model. It might be expected that even if the microeconomic behavior is lumpy, the effect disappears at the aggregate level because of the law of large numbers. However, we show that if there exist interactions among firms, a regular endogenous cycle emerges at the aggregate level given that the degree of the interaction effect exceeds a critical point. That is, the randomly behaving microeconomic agents generate deterministic collective behavior via interactions. This offers an explanation for the Kitchin cycle.

Microeconomic structure determines macroeconomic dynamics: Aoki defeats the representative agent

Masanao Aoki developed a new methodology for a basic problem of economics: deducing rigorously the macroeconomic dynamics as emerging from the interactions of many individual agents. This includes deduction of the fractal/intermittent fluctuations of macroeconomic quantities from the granularity of the mezo-economic collective objects (large individual wealth, highly productive geographical locations, emergent technologies, emergent economic sectors) in which the micro-economic agents self-organize. In particular, we present some theoretical predictions, which also met extensive validation from empirical data in a wide range of systems: The fractal Levy exponent of the stock market index fluctuations equals the Pareto exponent of the investors wealth distribution. The origin of the macroeconomic dynamics is therefore found in the granularity induced by the wealth/capital of the wealthiest investors. Economic cycles consist of a Schumpeter ‘creative destruction’ pattern whereby the maxima are \(\varLambda \)-shaped cusps. In between the \(\varLambda \)-cusps, the cycle consists of the sum of 2 ‘crossing exponentials’: one increasing (corresponding to the creation of the ‘new’) and the other one decaying (corresponding to destruction of the ‘old’). This unification within the same theoretical framework of short term market fluctuations and long term economic cycles offers the perspective of a genuine conceptual synthesis between micro- and macroeconomics. Joining another giant of contemporary science—Phil Anderson 1972—Aoki emphasized the role of rare, large fluctuations in the emergence of macroeconomic phenomena out of microscopic interactions and in particular their non self-averaging, in the language of statistical physics. In this light, we present a simple stochastic multi-sector growth model.

Microeconomic Structure Determines Macroeconomic Dynamics. Aoki Defeats the Representative Agent

Masanao Aoki developed a new methodology for a basic problem of economics: deducing rigorously the macroeconomic dynamics as emerging from the interactions of many individual agents. This includes deduction of the fracta/intermittent fluctuations of macroeconomic quantities from the granularity of the mezo-economic collective objects (large individual wealth, highly productive geographical locations, emergent technologies, emergent economic sectors) in which the micro-economic agents self-organize. In particular, we present some theoretical predictions, which also met extensive validation from empirical data in a wide range of systems:- The fractal Levy exponent of the stock market index fluctuations equals the Pareto exponent of the investors wealth distribution. The origin of the macroeconomic dynamics is therefore found in the granularity induced by the wealth/capital of the wealthiest investors. - Economic cycles consist of a Schumpeter 'creative destruction' pattern whereby the maxima are cusp-shaped while the minima are smooth. In between the cusps, the cycle consists of the sum of 2 'crossing exponentials': one decaying and the other increasing. This unification within the same theoretical framework of short term market fluctuations and long term economic cycles offers the perspective of a genuine conceptual synthesis between micro- and macroeconomics. Joining another giant of contemporary science - Phil Anderson - Aoki emphasized the role of rare, large fluctuations in the emergence of macroeconomic phenomena out of microscopic interactions and in particular their non self-averaging, in the language of statistical physics. In this light, we present a simple stochastic multi-sector growth model.

Segmenting Supply Chain Risk Using E/CTRM Systems: Unifying Theory of Commodity Hedging and Arbitrage

The complexity of managing physical and financial risk throughout the commodity production, processing and merchandising chain presents numerous challenges. To solve this problem commercials are increasingly turning to Energy and Commodity Transaction Risk Management (E/CTRM) systems. Still, risk management functionality within these systems is reported as falling short of requirements. Our discussion, in response, provides an economic framework for developing commodity risk policy and evaluation tools. In doing so, we unify the theory of normal backwardation with theory of storage, macroeconomic general equilibrium with multiple equilibria and microeconomic agents, basis trading with arbitrage strategies, and the hedging response function with elastic/inelastic supply-demand economics. After establishing axioms and rules of inference, we investigate the agribusiness supply chain to help illustrate application.

ECONOMIC INTEGRATION IN EAST ASIA: WHY WE NEED TO ACCELERATE REGIONAL INTEGRATION AFTER THE ECONOMIC CRISIS OF 2008-09

World trade dramatically expanded after the Second World War under the GATT system, which was succeeded by the World Trade Organization. The GATT sought a multilaterally increased world trade system. However, this system developed with a process of integration through regional agreements. This article focuses on microeconomic agents which promote regional economic integration and studies what agents have promoted the postwar integration. Researching into the theories of economic integration, this article focuses on the behavior of multinational corporations whose objective is to internalize their trade at the open markets. The multinationals seek economic integration because they want to completely cross tariff barriers, quotas and foreign exchange restrictions. This study tries to understand, from a political-economic point of view, the possibility of East Asian economic integration after the economic crisis of 2008-09.

Macroeconomic Relaxation: Adjustment Processes of Hierarchical Economic Structures

Abstract We show how time-dependent macroeconomic response follows from microeconomic dynamics using linear response theory and a time-correlation formalism. This theory provides a straightforward approach to time-dependent macroeconomic model construction that preserves the heterogeneity and complex dynamics of microeconomic agents. We illustrate this approach by examining the relationship between output and demand as mediated by changes in unemployment, or Okun’s law. We also demonstrate that time dependence implies overshooting and how this formalism leads to a natural definition of economic friction.

Macroeconomic Relaxation: Adjustment Processes of Hierarchical Economic Structures

We show how time-dependent macroeconomic response follows from microeconomic dynamics using linear response theory and a time-correlation formalism. This theory provides a straightforward approach to time-dependent macroeconomic model construction that preserves the heterogeneity and complex dynamics of microeconomic agents. We illustrate this approach by examining the relationship between output and demand as mediated by changes in unemployment, or Okun's law. We also demonstrate that time dependence implies overshooting and how this formalism leads to a natural definition of economic friction. --

Legal Reform, Externalities and Economic Development: Measuring the Impact of Legal Aid on Poor Women in Ecuador

The authors assisted the World Bank in conducting an economic evaluation of the effectiveness of legal aid clinics for poor women in Ecuador. The legal aid clinics were a small part of a project to promote legal and judicial reform (LJR) in Ecuador, in turn part of a World Bank initiative to promote such reforms throughout the developing world. World Bank support for the clinics was ending just as we began our work. Measuring the effectiveness of the clinics presented two challenges: deciding what to measure and finding a practical way to measure it. LJR is thought to contribute to economic growth and the reduction of poverty. Reform is also thought to increase the quality of life, because people place an independent value on “the rule of law.” We need to assess the performance of the legal clinics against these goals. The literature on LJR in developing nations largely ignores the literature on microeconomic analysis of law, and hence lacks a framework for linking legal reform to economic growth at the level of microeconomic agents. Our first task is to apply economic learning to the problem of legal reform—that is, to identify the microeconomic foundations of the rule of law as they apply here. Once accomplished, this model points clearly to what should be measured in evaluating reforms: the positive externality of reforms on expectations of what courts will do. The second challenge—measurement—is conducted under typical real world constraints. The clinics did not collect or preserve ideal data, an evaluation component was not built into the project, funds for data collection and analysis were limited, and the objectives we ultimately decided to measure were not necessarily those that the clinics set out to achieve. In light of these difficulties, our econometric results are useful chiefly as a demonstration that empirical evaluation of the contributions of LJR to economic development is possible. We were not able to measure more than a hint of the most important benefits of the clinics—their spillover impact on non-participants. But even without this potentially very large positive externality, the clinics appear to have made a contribution to the economic well-being of poor women in Ecuador. In the future, legal and judicial reform projects should be undertaken not merely to achieve

Environmental impairment liability in the czech republic

The subject treated in this article is environmental impairment liability, which becomes a still more important legal and economic instrument of environmental policy complying with claim of denationalization. It is a market-conforming instrument not requiring that the public authorities will focus their activities on direct management of microeconomic agents. The article reflects: brief description of the functions and position of environmental impairment liability among the other tools of environmental policy; evaluation of the extent to which the initiatives aimed at European harmonisation have been successful; analysis of the present state of works on environmental impairment liability legislation in the Czech Republic.

Progress and Microeconomic Data

Is academic economics becoming increasingly divorced from reality? This paper studies the contents of full-length articles published in the Economic Journal between 1959 and 1990. It finds, contrary to what some believe, that there has been significant growth in empirical research on real firms, people, and other microeconomic agents. However, this upward trend apparently leveled out, at about one article in five, in the middle of the 1970s. Copyright 1991 by Royal Economic Society.