The 16th
HETSA Conference
ABSTRACTS
IN ALPHABETICAL ORDER
1. Distributional
Implications of Contemporary Judeo-Christian Economics
Cara and Clive
Beed
Melbourne University (Ret.)
Australian Catholic University (Ret.)
136
Rathmines Road
Hawthorn
East VIC 3123
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.
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.
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.
4. An Outline on
the Development of Political Business Cycles
(Work-in-progress)
Jerry Courvisanos
School of Business
University of Ballarat
P.O. 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.
5.
The Trials of Whitaker Wright
Owen
Covick
School of Business Economics
Flinders University
GPO Box 2100
Adelaide SA 5001
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.
6. Visualizing the Gains from Trade,
mid-1870s-1962
Neil
De Marchi
Department
of Economics
Duke
University
Durham,
NC 27701
USA
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.
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.
8. Fact and Value in Economics: Putting 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.
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.
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.
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.
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 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. Austrian 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.
17. The Economics of N.
Tugan-Baranowski
Bruce McFarlane and Tony Atley
18. An Italian
Foundation for New Fiscal Sociology:
A Reflection on the Pareto-Griziotti-Sensini letters on Ricardian Equivalence
and Fiscal Theory
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.
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’s.
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.
21. KEYNES AS A WRITER: THREE CASE STUDIES
Rod O’Donnell
School of Economics and Finance
Macquarie University
North Ryde NSW 2109
rod.odonnell@efs.mq.edu.au
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.
22. Henry George’s Lecture Tour of Australia in 1890
John Pullen
School of Economics and Finance
University of New England
Armidale NSW 2351
jpullen@pobox.une.edu.au
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.
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.
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.
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.
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’.