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The 16th HETSA Conference ABSTRACTS AND PAPERS IN ALPHEBETICAL ORDER
1. DISTRIBUTIONAL IMPLICATIONS OF CONTEMPORARY JUDEO-CHRISTIAN ECONOMICS Cara and Clive BeedMelbourne University (Ret.), Australian Catholic University (Ret.), 136 Rathmines RoadHawthorn East VIC 3123cncbeed@netspace.net.auwww.netspace.net.au/~cncbeed/The distribution of wealth and income has re-emerged as an important issue in economics, social science, and philosophy in the last few decades. In the same period, the relevance of derivative Judeo-Christian socio-economic principles to the contemporary world has been (re)asserted, developing an incipient Judeo-Christian economics. Methodologically, this undertaking is comparable to that underlying the evolution of Islamic and other forms of religious economics. The methodology employed in the Judeo-Christian undertaking is described via a worked example. The example shows how normative principles can be derived from Judeo-Christian thought allegedly relevant to shaping the contemporary distribution of wealth and income. The principles are deduced from a particular sub-set of Judeo-Christian source material, and have the effect of generating greater equity in economic distribution. The deductions are compared with selected ideas canvassed in recent economics discussion about inequitable distribution concerning appropriate criteria for guiding redistributional policy, ideas of “equal opportunity” versus “equal outcomes”, and the relation between distribution and economic growth. Click here for PDF Version of Paper
2. SATIETY AND BEYOND:SCITOVSKY'S ANALYSIS OF THE JOYLESS ECONOMY Marina Bianchi Professor of Economics, Department of Economics and Environment, University of Cassino Via Mazzaroppi 10 Cassino, Italy Tibor Scitovsky (1910-2002) left his mark on a wide array of important topics in economics—from international trade and growth to monopoly power and competition—though his main interest was to uncover the welfare implications of economic interactions. In the last thirty years of his life he focussed on the study of a completely neglected component of these interactions, the role that stimulating activities in all their variety, from sports to the arts, from conversation to intellectual activities, can have on individual and social well-being. This brought him to redress the focus of economic thinking towards the mechanisms underlying individual preferences and the ways these may respond to variables such as variety, novelty and change. My paper concentrates on this late research, and on the analytical consequences in terms of rational choice and social welfare that Scitovsky’s new approach suggests. His Joyless Economy, published in 1976 and reissued in a revised edition in 1992, represents his attempt to deal with these problems and disclose to economists some of the findings of psychological research relevant to pleasure, utility, and well-being. The book was not a success in terms of its impact on mainstream economics, though in the past decade or so all its central points have become subjects of independent research and many of the questions opened by it remain among the leading questions of current psychological and economic research. Chief among these is a new-found interest in the determinants of well-being and in its underlying processes. My paper explores the subject of happiness and well-being in historical as well as analytical perspective, underlining the paradox that, despite their being the obvious goals of economic choices, have been left outside the realm of economic analysis for much of the past three hundred years. Click here for PDF
Version of Paper 3. CAMBRIDGE, ENGLAND OR CAMBRIDGE, TASMANIA? SOME RECENT EXCAVATIONS OF THE GIBLIN MULTIPLIER William Coleman Australian National University , Faculty of Economics and Politics, Austin Robinson Building Sidgwick Avenue, Cambridge, CB39DD William.Coleman@econ.cam.ac.uk The paper publishes some previously unnoticed investigations of the multiplier concept by Giblin and Brigden before 1930. It contrasts their 1929 conception of the multiplier 1930 with the conceptions offered by Kahn and later authors. Click here for PDF Version of Paper
4. AN OUTLINE ON THE DEVELOPMENT OF POLITICAL BUSINESS CYCLES (Work-in-progress) Jerry Courvisanos School of Business, University of Ballarat, GPO Box 663, Ballarat VIC 3353 mailto:j.courvisanos@ballarat.edu.au Political business cycles (PBCs) refer to the additional layer of business cycle analysis over the pure business cycle that comes into operation with government intervention. Essentially, these are the political causes of any business cycle patterns that occur over and above the strictly economic causes. Governance of the business cycle path becomes a crucial issue for any government in a capitalist economy, both from the perspective of winning (and retaining) electoral power and in terms of responsible economic managers.The first rigorous theory on the PBC is credited to Michał Kalecki in his extensively quoted article, Political Aspects of Full Employment (1943). PAFE has a Marxian class analysis as the foundation, where the capitalist class prevails over the political institutions of the society. PAFE has an element of electoral concern that faces all capitalist democracies, when it notes the necessity that “something must be done in the slump” to stimulate the economy. Nordhaus (1975) acknowledges PAFE as the “only serious theory” on PBCs, then creates an electoral-based version of the PBC that is driven by politicians who manipulate macroeconomic instruments in concert with the electoral policy cycle. This type of PBC removes the class-base of PAFE and significantly shifts the initiating force from Kalecki’s “business interests” to politicians with an eye to getting elected in the upcoming election and the aftermath of the election. The electoral-based PBC developed a separate and dominating position in the economics literature as mainstream economists now had a PBC analysis that could be accommodated inside the standard neo-classical framework where the exogenous political influence on the business cycle could be divorced from the role of market-based business. Political scientists have proceeded to distinguish between two versions of this electoral-based PBC: (i) electoral vote-maximising model with office-seeking policy makers and (ii) partisan vested interests model with policy-seeking policy makers.The aim of this paper is to outline the historical development of all forms of PBCs and provide a history of economic thought perspective to the significance of PBCs in policy analysis. Click
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PDF Version of Paper 5. THE TRAILS OF WHITAKER WRIGHT Owen Covick and Beverley Vickers School of Business Economics, Flinders University, GPO Box 2100, Adelaide SA 5001 Whitaker Wright was the high-media-profile unacceptable face of corporate finance of one hundred years ago. He died at about 3.30 on the afternoon of Australia Day, Tuesday 26 January 1904 in a “consultation room” below the Royal Courts of Justice on the Strand in London. The coincidence of Australia Day was perhaps apt since Australian gold-mining ventures had played a key role both in Wright’s period of financial success and in his dramatic fall from grace. Half an hour before his death Wright had been sentenced to seven years imprisonment, following the verdict of a special jury on charges concerning his actions while managing director of the London and Globe Financial Corporation prior to its spectacular “failure” on Friday 28 December 1900. On Thursday 28 January 1904 the jury at Whitaker Wright’s inquest, having heard the evidence from the post-mortem, immediately (without retiring) brought in a verdict of suicide. Thus ended Whitaker Wright’s last trial. The inquest verdict is hard to question. There was post-mortem evidence of cyanide of potassium having been taken. A search of Whitaker Wright’s body also revealed a “six-chambered revolver fully loaded and cocked” in his right hand hip-pocket, which he had apparently carried on his person during his final day in court. The climactic trial of January 11 to January 26 1904 was the culmination of a series of court appearances and judicial processes triggered by the London and Globe collapse of 28 December 1900. Taken as a whole this series of “trials” and the evidence presented at them provides a wealth of information about contemporary thinking concerning the mechanisms of company promotion and stock-market practices in the years surrounding the turn of the last century. Click here for PDF
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6. VISUALIZING THE GAINS FROM TRADE, MID-1870s-1962 Neil De Marchi Department of Economics, Duke UniversityDurham, NC 27701USA Visualizations of “the gains from trade” have been a preferred medium for much of the history of modern trade theory. But this does not support the notion that there is some common, universal, visual core in the gains idea. Two separate histories of visualizing efforts, one by Marshall and one by Samuelson, reveal a range of different ways in which visualizations were chosen and deployed, and between what worked and what did not. The notion of what works alerts us to a role for viewers as well as makers. Modern neurological research would lead us to expect that viewers will construct visualizations differently, independently of authorial intent. The two histories hint at this, but more particularly remind us that makers too are viewers and that even for them visualization may be a somewhat experimental and uncertain process. Click here for PDF
Version of Paper 7. DAVIDSON, KEYNES AND KALECKI Robert Dixon Department of Economics, The University of Melbourne, Parkville VIC 3052 This paper sets out my response to the articles by Paul Davidson in the Journal of Post Keynesian Economics in 2000 and 2002 dealing with the (supposed) superiority of Keynes’s explanation of the “ultimate cause” of unemployment over that of Kalecki. I show that there are a number of serious errors in Davidson’s explanation of Kalecki’s theories. I also argue that we would have less of this sort of nonsense if ‘post keynesians’ like Davidson were to recognize that, for Keynes, as for Kalecki, aggregate demand shocks are profit shocks. In the final section of the paper I explain why it is that I none-the-less agree most emphatically with Davidson when he says that Kalecki and Keynes had quite different ideas on the ‘causes’ or ‘origins’ of (involuntary) unemployment in a capitalist economy. Click here for PDF Version of Paper
8. FACT AND VALUE IN ECONOMICS: PUTTING THE PIECES THE PIECES BACK TOGETHER Jamie Doughney Work and Economic Policy Research Unit, Victoria University PO Box 14428, Melbourne City Mail Centre, Melbourne VIC 8001 During the 1930s positivism within political economy gained ascendancy, especially with Lionel Robbins’s notable assertion that value statements were metaphysical and, therefore, essentially meaningless. Economics as a science must deal rather with matters of fact. Joan Robinson’s Economic Philosophy, published some 30 years later also maintained that values were metaphysical, though she also said that they were essential for practical and political life. There were always critics of the fact-value dichotomy in economics. Maurice Dobb, writing contemporaneously with Robbins, was one. Amarta Sen has long been another and, more recently, philosopher Hilary Putnam has weighed into the debate. This paper briefly reviews some of the history of the fact-value dichotomy and challenges to it, outlines the core philosophical arguments and sides firmly with Dobb, Sen and Putman in calling for economics to recognise that facts and values were never really separate: at least in the real world.
9. ETHICS AND ECONOMICS: A CATHOLIC PERSPECTIVE Rev Fr Bruce Duncan Redemption Community, 10 Majella Court, Kew VIC 3101 This paper will briefly consider a). the origins of modern economics, especially as seen in the often misunderstood Adam Smith, and its relationship to moral philosophy and ethics; b). offer an overview of changing perspectives in Catholic social thinking and its relationship with economics, particularly its critique of neo-liberalism; c). comment on Amartya Sen’s critique of the utilitarian basis of economics.b.duncan@mcd.edu.au Bruce Duncan has an honours degree in economics and a PhD in political science from the University of Sydney. Since 1986 he has lectured in social ethics, including economic development, at Yarra Theological Union in Melbourne. Among his recent publications are Crusade or Conspiracy? Catholics and the Anti-Communist Struggle in Australia (Sydney: UNSW Press, 2001), and War on Iraq: Is it Just? (Sydney: Australian Catholic Social Justice Council, 2003).
10. ON ARCHITECTS OF INTERNATIONAL FINANCE: FROM BRETTON WOODS TO THE 1970s (Work-in progress) Tony Endres Department of Economics, The University of Auckland, Private Bag 92019, Auckland, New Zealand This paper offers an outline of a book manuscript in process. The book examines competing economic doctrines embodied in blueprints, plans and proposals for international monetary reform offered by prominent economists following the Bretton Woods (BW) agreement up to the dissolution of BW in the 1970s.The genesis of international monetary relations in the twentieth century has been accorded considerable research attention. Retrospectives on the performance of BW are widely available. However, doctrinal studies are scarce. Key proposals from luminaries in the economics profession emerging in the 1946 - 1970 period have not been systematically exposited and compared. In expositing the essence of each proposed system of international finance this book will use the following questions as guidelines: What are the expected objectives and requirements of a genuinely international financial system? What key aspects of the system were targeted for reform? In the immediate period post-BW agreement, did economists' interpretations of interwar experience still influence their proposals and how did their expectations of the post war world influence their ideas? How well, if at all, did the economists' doctrines identify defects in the BW system that would lead to serious problems later and how might their proposals have avoided these problems? In different doctrinal traditions on international financial reform what were the normative bases of reform proposals?The book's doctrinal approach will draw lessons for modern thought on the subject. An intellectual history perspective can expand our understanding of the principles that might make for feasible, credible and enforceable international monetary arrangements; it also isolates recurring, modern themes confronting architects of each system. Certainly a strong normative element appears pervasive: each proposed system harboured alternative visions of the appropriate nature, scope and method of inter-country monetary interaction and their consequences. Moreover, each system took a different position on the necessity for joint responses to perceived negative spillover effects arising from these interactions and the role of international financial institutions in this connection.Revisiting neglected contributions on international money serves the purpose of demonstrating the influence of intellectual fashions in the field. Various blueprints, nostrums and more pragmatic schemes for reinforcing the international financial system have been likened to architectural exercises. What might have been regarded at various points in the 1946 - 70s period as undesirable 'architectural' forms - as infeasible systems lacking credibility enhancing attributes or as impractical, ambitious schemes - in fact have appeared in new forms in the late twentieth century to justify an existing international regime environment. Fertile ideas worked out and made available in the doctrines surveyed in this book were already in the air when more persuasive proponents of flexible exchange rates, capital mobility, simple rule-based national regimes and monetary unions came on the scene in the last quarter of the twentieth century. Doctrinal studies of the type proposed here perhaps have a modest function - they can identify features of older systems of thought that have not been rendered obsolete. Click here
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Version of Paper 11. KEYNES, 1937 (and Thereabouts) Geoffrey Fishburn Department of Economics (Ret.), University of New South Wales, Sydney NSW 2052 How did Keynes publicly express
and defend the revolutionary ideas which he had put forward in the
General Theory (1936)? The principal focus in this paper,
as a preliminary enquiry, are the two papers published in February,
1937: the well-known Quarterly Journal of Economics paper,
and his lesser-known Eugenics Review paper (text of his Galton
Lecture). Other material, where relevant, is considered. 12. MACROECONOMIC POLICY AND INDUSTRIAL STRUCTURE: CONTESTED PARAMETERS OF ECONOMIC POLICY IN POST-WORLD WAR II AUSTRALIA Evan Jones Political Economy Discipline, Faculty of Economics & Business University of Sydney, Sydney NSW 2006 The use of macroeconomic policy in Australia has generally been inconsiderate of the unequal sectoral impact of macroeconomic instruments. The period immediately following World War II provides an opportunity to confront the interaction and tension between the purely macroeconomic and structural perspectives on appropriate policy. The six-year period from 1945 to the high inflation of 1950/51 and the repressive macroeconomic measures in 1951/52 provide an excellent case study in the evolution of policy instruments for the control of the Australian economy during the long boom. The particularities of the policy-making environment in Australia, rather than any preconceived theoretical schema, played a large role in that evolution. The notion has seeped into the textbooks that macroeconomic policy, specifically in a Keynesian mould, was responsible for the boom. That interpretation neglects the myriad structural policies of the period, and the pragmatic evolution of both structural and macroeconomic instruments from experience of their use in practice. Click here to view PDF
Version of Paper 13. SAY'S LAW AND THE MODERN ECONOMY Steven Kates Chief Economist Australian Chamber of Commerce and Industry, and the Australian National University, P.O. Box E14, Kingston ACT 2604 Say’s law of markets has been the pivotal
issue in economic theory for the past two centuries. From the period
roughly beginning with the publication of Say’s Treatise
in 1803 and through until 1936, explicit acceptance of the law of
markets was the hallmark of orthodox economics. Then, with the publication
of the General Theory in 1936, economists have made the explicit
rejection of the law of markets the cornerstone of macroeconomics
and the theory of the cycle. This paper will address two related
issues. The first is the nature of the Keynesian Revolution as the
reversal of the prior acceptance of Say’s Law. This section will
focus on the roots of this revolution in Keynes’s coming into contact
with the writings of Malthus in 1932. The second part of this paper
will then argue that virtually the entire body of macroeconomic
theory today is in all its essentials Keynesian, focusing as it
does on demand deficiency and the possibility of overproduction
as a potential cause of recession, the very conclusion rejected
by Say’s Law. 14. FREDERICK ALLEN AND THE FUTURE OF CAPITALISM John King Department of Economics and Finance, La Trobe University, Bundoora VIC 3086 In March 1938 Victor Gollancz’s Left Book Club published a book entitled Can Capitalism Last?, by Frederick Allen (the pseudonym of Denis Herbert Stott, 1909-1988). This was an original and ambitious attempt to synthesise Marx and Keynes, making deficient aggregate demand the fundamental economic contradiction of capitalism, but in a dynamic context in which technical progress raises productivity faster than real wages and generates a chronic problem of surplus absorption. Allen considers the potential contributions of consumption, investment, government expenditure and imperialism as outlets for surplus, concluding that none of them is able to solve the problem of inadequate purchasing power. But he is not a breakdown theorist: the future of capitalism, he concludes, is more a political than an economic question. In both structure and content Allen’s analysis is strikingly similar to that of Baran’s and Sweezy’s Monopoly Capital (1964). His book displays many of their strengths and all of their weaknesses. Click here for PDF Version of Paper
15. PETER GROENEWEGEN AND THE HISTORY OF POLITICAL ECONOMY (Work-in-progress) John Lodewijks Department of Economics, University of New South Wales, Sydney NSW 2052 and Tony Aspromourgos School of Economics and Finance and Political Science University of Sydney, Sydney NSW 2006 t.aspromorgous@econ.usyd.edu.au This paper attempts to outline and assess Peter Groenewegen’s contributions to the history of economics. After a discussion of Groenewegen’s formative years, we attempt to describe the underlying analytical core and character of his scholarly work. The discussion is then broadened to incorporate his role in the various institutional structures that promote the history of economics in the discipline. Some concluding remarks relate to coherence and changing historiographic approaches.
16. AISTRIAN CAPITAL THEORY (Work-in-Progress) Troy P Lynch Research Student, Department of Economics and Finance, La Trobe University, Bundoora VIC 3086 The Austrian School of Economics and Finance subscribes
to a number of axioms, chief among them being methodological subjectivism
and methodological individualism. These are at the heart of their
overall approach to economics.Their emphasis on subjectivism, time
and process are central in the development of their capital and
interest theories. Of interest is their capital theory. The development
of a capital theory occurred through the effort of a number of central
characters. They did not always agree on a consistent methodological
approach, and so, the theory has evolved across a few generations
of scholars, with variations on the methodology and the resultant
theories. The Austrians maintain that it is the consistent outworking
of a subjectivist position that is crucial to explaining the actions
of individuals in the market economy. It is their explicit consciousness
of time and process that makes the Austrians of both historical
and contemporary interest, especially when the fact of uncertainty
is given due emphasis.The research that I am undertaking into Austrian
capital theory is primarily focused on examining their subjectivist
approach. While at an early stage, an examination of this matter
could develop as a critical appraisal of the theory and be assessed
in terms of internal rigor and consistency in logic, or by comparison
with other capital and interest theories. Click here for PDF Version of Paper
17. THE ECONOMICS OF N TUGAN-BARANOWSKI Bruce McFarlane and Tony Atle
18. AN ITALIAN FOUNDATION FOR NEW FISCAL SOCIOLOGY: A Reflection on the Pareto-Griziotti-Sensini Letters on Ricardian Equivalence and Fiscal Policy Michael McLure University of Western Australia Economics Program, Crawley, WA 6009 This paper reflects on the influence of Pareto’s letters to two of his ex-students, Benvenuto Griziotti and Guido Sensini, concerning Ricardian equivalence and fiscal theory. The six letters, written between 1917 and 1920, are of historical interest because they criticise the exclusion of “social equilibrium” from fiscal studies at the very time that Italian fiscal scholars were turning their attention to fiscal sociology. Interestingly, the two sets of letters had different results: Griziotti came to reject Pareto’s contention that social equilibrium should play a central role in fiscal studies, whereas Sensini devoted considerable effort to developing fiscal studies that placed the impact of fiscal phenomena on social equilibrium as the central issue. From a purely historical perspective, the dominant Italian approach to fiscal studies was generally consistent with Griziotti’s approach, with Sensini’s ongoing attempts to develop a Paretian theory of public finance meeting limited success. In regard to current relevance, however, a contrasting result emerges; with Sensini’s approach demonstrating significant potential to influence modern development in fiscal sociology. Once deficiencies (that prevented Sensini from demonstrating the analytical gains associated with a focus on social equilibrium) are removed, there is scope for a new ‘Pareto-Sensini’ inspired fiscal sociology to emerge. A provisional outline of this new fiscal sociology is included in this paper. Click here for PDF Version of Paper
19. NIEMEYER, SCULLIN AND THE AUSTRALIAN ECONOMISTS Alex Millmow School of Management, Charles Sturt University, Riverina PO Box 588, Wagga NSW 2678 This article revisits the Niemeyer mission to Australia in 1930 and shows how it inadvertently facilitated the entry of local economists into the art of economic policy making. Up till then Scullin and Labour politicians held little regard for the worth of academic economists. It was a view shared by bankers and central bankers alike. With Niemeyer’s dogmatic advice considered too draconian by a vacillating government Australian economists, led by L.F. Giblin and D.B. Copland were galvanised into providing more palatable expedients. This eventually materialised in the 1931 Premiers’ Plan together with a prior devaluation and wage cut. While the Plan was inherently deflationary it was a more equitable and imaginary blueprint than Niemeyer’ Click here to view PDF
Version of Paper 20. ASHLEY' THE TARIFF PROBLEM: A CENTENARY APPRAISAL Gregory C. G. Moore School of Business and Informatics, St Patrick’s Campus, Australian Catholic University 115 Victoria Parade, Fitzroy VIC 3065 William James Ashley (1860-1927) was one of the leading historical economists of his generation and, along with Archdeacon William Cunningham and William Albert Hewins, he was instrumental in harnessing historicist principles to support the corporatist-cum-protectionist movement that grew to prominence in the late-Victorian and Edwardian periods. Ashley’s influence on the formation of policy within this movement reached its peak with the publication in 1903 of The Tariff Problem, which was issued shortly after the mercurial Joseph Chamberlain launched his political campaign to reintroduce a tariff structure in Great Britain. It is my contention that Ashley’s protectionist manifesto was partly the product of the experiences that marked his early adult life, such as of the vagaries of trade that he witnessed when growing up in the slums of London, the historicist doctrines that he developed while studying within the Oxford History School, and the actions of the large industrial trusts that he observed during his long tenure in North America. Indeed, it is my belief that some passages in this protectionist manifesto cannot be properly understood, or at least do not impart their full resonance, until Ashley’s social and intellectual background are brought into the foreground. There are four sections to the paper. In section two I trace Ashley’s extraordinary career prior to the publication of The Tariff Problem and emphasise, in particular, those experiences that shaped his views on protection. In section three I review The Tariff Problem itself and delineate the way in which many of the ideas contained therein are the direct product of Ashley’s experiences in the preceding decades. In section four I provide an account of Ashley’s equally rich career after the publication of The Tariff Problem and conclude the paper. Click here for PDF Version of Paper
21. KEYNES AS A WRITER: THREE CASE STUDIES Rod O’Donnell School of Economics and Finance, Macquarie University,North Ryde NSW 2109 Despite the fact that Keynes is often viewed as a master of English prose and as a great writer, his writings have generated a remarkable range of conflicting interpretations as to their content and meaning. This is puzzling, because one expects that a good writer, in subjects like economics, philosophy or politics, will also be a clear writer, that is to say, one expects masters of English prose to express their thoughts lucidly as well as gracefully.This paper offers some reflections on the interactions between Keynes’s characteristics as a writer and the clarity of his writings. It is argued that, on occasions, the underlying clarity of his thought is muddied by certain of his characteristics as a writer, in particular, by looseness or carelessness in the use of language. In such situations, the only path to his meaning is that of careful intellectual labour and close textual analysis. The argument is illustrated using three case studies of passages from the Treatise on Probability, the General Theory, and How to Pay for the War. Click here for PDF Version of Paper
22. HENRY GEORGE'S LECTURE TOUR OF AUSTRALIA IN 1890 John Pullen School of Economics and Finance, University of New England, Armidale NSW 2351 Standard biographies of Henry George give brief accounts of his lecture tour of Australia in 1890, based mainly on the reports he sent back from Australia for publication in his New York newspaper, The Standard. This study supplements previous accounts with further details of the 49 lectures and 7 Sunday sermons he gave in 38 towns and cities during his 98-day stay in Australia, based on contemporary Australian newspaper reports. With an obvious proviso about the accuracy of the reporting, the Australian lectures are a valuable source of additional information on George and his policies. Click here for PDF Version of Paper
23. TOOKE'S EXPLANATION OF GENERAL PRICE MOVEMENTS IN ENGLAND, 1792-1856 Matthew Smith Economics Discipline, School of Economics and Political Science, University of Sydney Sydney NSW 2000 In the monumental six-volume
History of Prices (1838-1857), Thomas Tooke (1774-1858),
with the collaboration of William Newmarch (1820-1882) in volumes
V and VI, provided a detailed explanation of the general movement
of prices in England over the period 1792 to 1856. While much of
Tooke’s historical analysis was concerned with explaining short-run
fluctuations in prices, especially in connection to economic crises,
he was also concerned with explaining the long-run secular movement
in the general price level by reference to major events exerting
a lasting impact on the British economy. This paper examines Tooke’s
explanation of general price movements, showing that he believed
‘natural’ and ‘political’ factors which affected the conditions
of supply was the main cause of price movements. In particular,
the paper examines Tookes’ views on the impact on the general price
level of the French wars, the currency restriction of 1797-1821,
British government war finance and taxation policy, the mid-century
gold discoveries, the Corn Laws, technological progress and climatic
conditions affecting agricultural productivity. The paper shows
that Tooke possessed an understanding of price movements far beyond
any other contemporary English economist. Click here for PDF Version of Paper
24. FROM CYCLING TO DRIVING: HENRY FORD AS THE FIRST SCHUMPETERIAN ENTREPRENEUR (Work-in-progress) Heath Spong School of Economics and Finance, RMIT University 239 Bourke Street, Melbourne VIC 3000 Few contributions to economic
theory have had such a long run impact on the profession as Joseph
Schumpeter’s epic work, The Theory of Economic Development
(1934). While it contains theoretical insights on numerous topics,
it is also possibly the most well-known economic theory of entrepreneurship;
Israel Kirzner’s explanation of the entrepreneur’s role in the market
process is perhaps the only notable challenge (Kirzner, 1973; 1992).
At around the same time that Schumpeter began writing this theory,
Henry Ford was in the midst of designing the Model-T. This paper
will undertake an analytic narrative (see Bates et al., 1998) that
uses Schumpeter’s theory of economic development, and more specifically
the entrepreneurial role, to explain the entrepreneurial activities
of Henry Ford. The paper will provide a detailed explanation of
Schumpeter’s theory, and highlight many aspects of Schumpeterian
entrepreneurship that have often been overlooked. Schumpeter’s theory
will then be used to guide an analytic narrative of the automobile
industry, including specific focus on Henry Ford’s activities. The
paper will identify the strengths and weaknesses of the creative
destruction approach. It will be shown that Schumpeter’s theory
does indeed provide an excellent explanation of Ford’s activities.
The paper also demonstrates the few potential shortcomings of Schumpeter’s
theory, particularly in regards to entrepreneurial failure, and
the existence of uncertainty.
25. SCHUMPETER’S THEORY OF IDEOLOGICAL INFLUENCE Matthew Steen Ph.D. Candidate Discipline of Political Economy, University of Sydney, Sydney NSW 2006 This paper contains a reassessment and interpretation of Schumpeter’s theory of ideological influence. It begins by distinguishing Schumpeter’s ‘positive’ notion of ideology from the ‘negative’ conception made popular by Marx and Engels. Next, Schumpeter’s definitions of ‘ideology’ and ‘ideological influence’ are sharpened, in light of problems with Schumpeter’s own formulation. The following section of the article discusses the relationship between ideology and what Schumpeter called vision and economic analysis. Finally, the argument is made that, with three important qualifications, Schumpeter’s theory of ideological influence is both tenable and useful. Click here for PDF Version of Paper
26. KEYNES, WAR AND ECONOMICS Sean Turnell School of Economics and Finance, Macquarie University, North Ryde, NSW 2109 This paper examines Keynes’s thoughts on the economic causes of war. Though an issue upon which the classical economists and their popularisers wrote much, the links between economics and war has become, beyond an unthinking acceptance of the pacific qualities of free trade, an issue largely ignored by economists. Keynes's thinking on the subject, however, was sustained, nuanced and, in its final manifestation, heavily influenced by the implications of his own revolutionary ideas in macroeconomics. By the end of his life Keynes had eschewed the simple liberalism of his youth, combining much that would later emerge within the 'realist school' of international relations with practical plans for a better world. Click here for PDF Version of Paper
27. “A GRIN WITHOUT A CAT”: W. S. JEVONS’ ELUSIVE EQUILIBRIUM Michael V. White School of Business And Economics, Monash University, Clayton Campus, Clayton VIC 3168 Mike.White@BusEco.monash.edu.au In the preface to his Theory of Political Economy (1871), W. Stanley Jevons wrote that, in the text, he had ‘alluded’ to ‘the cardinal difficulty with the whole theory’. Because it was only alluded to, the difficulty was not clearly explained. This paper makes three main points. First, Jevons’ difficulty consisted in explaining how a market-period equilibrium was attained and he was unable to do so. Second, Jevons obscured the presence and significance of the attainment problem with a series of mechanical metaphors. Third, the context in which the Theory was written suggests why Jevons was unwilling to clearly acknowledge and explain `the cardinal difficulty with the whole theory’. Click here for PDF Version of Paper
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