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Recent papers by date

Integrating Human Capital with Human Development: Toward a Broader and More Human Conception of Human Capital

A serious deficiency of the mainstream human capital (HC) concept is that it does not help one gain an adequate understanding of how human capacities develop or fail to develop during an individual’s lifespan.  Therefore, this paper proposes to integrate the HC and human development (HD) concepts.  This allows appreciation that much of HC formation … Continue reading »

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Posted for review 19 Aug 2014

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Universal Basic Income and the Cost Objection: What are We Waiting For?

Among the most common objections to providing everyone with an unconditional basic income is the cost objection.  It states that the cost of providing everyone with a decent income floor, beneath which no one would fall, is out of reach for governments and public finance.  Income taxes would have to be raised to unacceptable levels … Continue reading »

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Posted for review 5 Aug 2014

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Property Rights in Economics: The Fundamental Myth and the Fundamental Theorem

A theory of property needs to give an account of the whole life-cycle of a property right: how it is initiated, transferred, and terminated.  Economics has focused on the transfers in the market and has almost completely neglected the question of the initiation (and termination) of property in normal production (and consumption)—which is usually dealt … Continue reading »

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Posted for review 22 Jul 2014

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Climate Change, Procrastination and Asymmetric Power

This paper argues that policy conclusions of the economics of climate change literature based on ‘integrated assessment models’ (IAM) fails to take into account the intricacies of collective action. Specifically, IAMs do not account for how asymmetric power between developed and undeveloped countries changes the former’s pay off matrix with respect to mitigation and adaptation … Continue reading »

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Posted for review 3 Jul 2014

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Understanding Keen and Standish

In a series of papers, Steve Keen and Russell Standish attempt to critique the textbook approaches to rm behavior under conditions of perfect and imperfect competition. In their attempts, they misrepresent the assumptions underlying the models, err in their mathematics, fail to follow through on their theoretical arguments, and fail to explain what drives the … Continue reading »

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Posted for review 15 Jun 2014

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The new trade agenda and the political economy of interest formation in Mode 4 trade: Do we need a better theory?

Deep integration as the leitmotif of global economic integration has fundamentally changed the character of trade politics. Trade policy has expanded into diverse new domains. The new trade agenda has raised the attention of new social actors and become a contested policy field. Given this situation, in this paper we ask, whether the standard models … Continue reading »

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Posted for review 14 May 2014

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Setting a Principle to Interest Cap on the Issuance of Home Mortgages

Traditionally most home buyers in the US need a mortgage and the current system of mortgage origination creates an incentive for borrowers to offer bids on homes far higher than would be possible without that system. This has inflated home values, increased financial indebtedness, and has increased banking profits without extensively helping other players in the … Continue reading »

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Posted for review 7 Apr 2014

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7 comments

Roots and Fruits of Democracy: Natural Resources, Income Distribution and Social Violence (Revised)

This paper proposes the argument that natural resource abundance and large economic inequality, by shaping the interests of different social groups, are key factors for the  etermination of the Transition scenario from authoritarianism to democracy. In turn, the transition scenario, and in particular the level of violence during democratization, determines the success or failure of … Continue reading »

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Posted for review 31 Mar 2014

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The price cannot be right: Taxation, Sub-Intrinsic-Value Housing Bubbles, and Financial Instability

A “general formula” for the price/rent ratio of a property is derived in terms of an exponential appreciation rate, a discount rate, a holding time, and a set of parameters describing the tax system, on the premise that property prices reflect intrinsic values after tax (“efficient markets”). Special cases are noted and interpreted and their consistency is verified. The formula … Continue reading »

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Posted for review 25 Feb 2014

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Determinants of Financialisation in South Africa: A Balance Sheet Approach

This paper focuses on the process of finacialisation in South Africa. Financialisation is defined after Krippner (2005) and Arrighi (1994), as a pattern of accumulation in which profits accrue through financial markets and channels rather than through trade or commodity production in the real economy. We examine the financialisation of the South African economy from … Continue reading »

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Posted for review 12 Feb 2014

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3 comments

Rationality in the Theory of the Firm

We have previously presented a critique of the standard Marshallian theory of the firm, and developed an alternative formulation that better agreed with the results of simulation. An incorrect mathematical fact was used in our previous presentation. This paper deals with correcting the derivation of the Keen equilibrium, and generalising the result to the asymmetric … Continue reading »

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Posted for review 15 Jan 2014

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Does Saving Increase the Supply of Credit? A Critique of Loanable Funds Theory

The paper presents a critique of loanable funds theory by using simple accounting relationships and standard excess demand analysis. It is shown that many economists identify saving and the credit supply by interpreting the macroeconomic saving-investment identity as a budget constraint. According to that interpretation, more saving through lower consumption (and government spending) leads to … Continue reading »

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Posted for review 5 Dec 2013

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Okun’s law, Dead or Alive: A Fundamental Approach

Okun’s law, which relates changes in output to changes in unemployment is under discussion since Okun revealed it in 1962. Okun’s law is not a suitable tool to estimate unemployment or unemployment change from GDP growth g. We will show on a theoretical base how to improve the estimator and come up with an alternative. … Continue reading »

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Posted for review 1 Dec 2013

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The Dissolution of the Financial State: Evidence from the UK and Germany

The growth of a neo-liberal financial sector is evident in the post WW2 era. The key assertion of the paper is that the transformation of finance, leading to an erosion of (state) financial sovereignty, has not been driven by monetary factors alone but has, instead, mainly resulted from the tendency for the rate of profit … Continue reading »

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Posted for review 31 Oct 2013

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2 comments

THE DOUBLE PONZI: an alternative analysis of instability and crisis in the US economy

The current financial crisis is often thought to stem from “toxic” debts. Complex securitization transactions hid the extent of the lending problem for too long and the state had to step in to maintain confidence. But what if securitization was not driven by greed and unnecessary risk-taking, but by innovations required to bolster an already distressed financial system? What … Continue reading »

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Posted for review 20 Sep 2013

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2 comments

Roots and Fruits of Democracy: Natural Resources, Income Distribution and Social Violence

This paper proposes the argument that natural resource abundance and large economic inequality, by shaping the interests of different social groups, are key factors for the determination of the transition scenario from authoritarianism to democracy. In turn, the transition scenario, and in particular the level of violence during democratization, determines the success or failure of a democratic reform. … Continue reading »

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Posted for review 23 Jul 2013

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2 comments

Comments on the critiques and defense of neoclassical firm theory – papers by Steve Keen and Russell Standish and the logical soundness of the Marshallian assumption (revised)

This paper discusses several papers relating to criticism of neoclassical firm theory by Steve Keen and Russell Standish and the logical soundness of the Marshallian assumption. Some errors (Cournot-Nash theory) in the published papers by Steve Keen and Russell Standish have been acknowledged by the authors, and this paper intends to extend and summarize the acknowledged … Continue reading »

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Posted for review 22 Jul 2013

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India: Globalisation and Growth

Post-reforms, in the 1990s, India chose greater integration with the global economy as a part of its development strategy. Even though integration deepened, rates of growth of per-capita-income and investment levels did not change very much. But in the first decade of the 21st century both the pace and character of this integration changed. The … Continue reading »

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Posted for review 18 Jun 2013

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2 comments

Incrementum ad Absurdum: Global Growth, Inequality and Poverty Eradication in a Carbon-Constrained World

The paper seeks to assess the timeframe for eradication of poverty, defined by poverty lines of $1.25 and $5 per person per day at 2005 purchasing power parity, if pre-crisis (1993-2008) patterns of income growth were maintained indefinitely, taking account of the differential performance of China. On the basis of optimistic assumptions, and implicitly assuming … Continue reading »

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Posted for review 7 Jun 2013

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1 comment

Are Financial Markets Stable? A Survey of Three Theories of Financial Markets in Light of the 2008 Crisis

The purpose of this essay will be to examine theories of financial stability and instability with the view to eventually establishing whether financial markets are inherently stable or unstable, especially in light of the evidence thrown up by the worldwide financial crisis of 2008.  We will begin by examining the three major existing theories of … Continue reading »

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Posted for review 3 May 2013

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1 comment

On the Historical, Moral and Economic Arguments for Asymmetric Trading Regimes: the case of sub-Saharan Africa

The Least Developed Countries Report 2006 argued that a paradigm shift in national and international policies to promote development and poverty reduction is required because current policies are inadequate and have failed to develop productive capacities in the underdeveloped economies. However, the policies that are advocated do not deal with the fundamental question of how … Continue reading »

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Posted for review 16 Apr 2013

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5 comments

A comment on the critiques of the neoclassical firm theory

This paper investigates into some of major errors made by Steve Keen and Rus- sell Standish (K-S) in their papers in Utilities Policy and Real-World Economics Review. The most important error that this paper nds is the wrong use of cal- culus that makes price (or demand) function of market inapplicable for calculus usage. This … Continue reading »

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Posted for review 16 Apr 2013

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12 comments

A Neoclassical Curmudgeon Looks at Heterodox Criticisms of Microeconomics

The purpose of this paper is to open a dialogue with heterodox economists about what, from a neoclassical perspective, is valid in heterodox criticisms of neoclassical microeconomics. Many heterodox criticisms of neoclassical microeconomics are valid to a neoclassicist; but some are not.  Examples of both are given, mostly taken from E. Fullbrook’s anthology, A Guide … Continue reading »

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Posted for review 20 Nov 2012

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14 comments

About Simple Economic Reproduction and Macroeconomic Indicators

Reproduction is infinitely renewable, continuous production process. This means that as a result of production its premises, conditions for continuing production are also reproduced. Without the understanding of this process, cannot be explained the functioning of economy, as an integrity, as a living organism. Neoclassical theory considers the production of goods as a unidirectional process … Continue reading »

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Posted for review 29 Sep 2012

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10 comments