Post-Keynesian

Frederick Douglass was an escaped slave, a great abolitionist orator, and generally a great American. Not too long ago, I read one of his autobiographies. Of his speeches, I am most likely to recognize bits from his 1952 observations on independence day. (Eldridge Cleaver quotes it in Soul on Ice.) This part is fierce: What, to the American slave, is your 4th of July? I answer: a day that reveals to him, more than all other days in the year, the gross injustice and cruelty to which he...

Figure 1: Intercepts of Production Possibilities Frontiers for England1.0 Introduction In this example, gains and losses from trade vary with international prices. Given rates of profits are compatible with an interval of relative international prices for linen and corn, when trade exists only in consumer goods. I explore whether, when trade exists in capital and consumer goods, more than one pattern of specialization among countries is possible, depending on relative international...

Figure 1: Production Possibility Frontiers1.0 Introduction Suppose foreign trade is possible in consumption goods, but not in capital goods. In this example, whether or not England achieves gains from trade depends on relative international prices. If foreign trade were possible in both consumption and capital goods, both England and Portugal would obtain gains from trade. The numeric example in this post is a modification of one in a previous post. As I understand it, most students of...

Matthew Klein writes, in Barron's, about "Tarrifs and the Minimum Wage Are More Alike Than You Think". I disagree with some of the stuff in the middle about efficiency and reject the dualistic notion that government intervention is a meaningful concept. But this article otherwise parallels some of my arguments here. Josh Mason has made available his piece in Jacobin about the state of economics after the global financial catastrophe. The Review of Political Economy has made available...

Figure 1: Production Possibility Frontiers1.0 Introduction This post presents a numeric example of foreign trade in a model of the production of commodities by means of commodities. This is a modification of the model here, which considers a flow-input, point output technology. As usual, I show neoclassical economics is mistaken. Frictions, increasing returns, information asymmetries, principal agent problems, and so on do not need to be introduced to explain why the outcomes of free...

I have made a working paper with the above title available on SSRN. Abstract: This article illustrates the application of pattern analysis to structural economic dynamics with a choice of technique. A numerical example is presented in which technical progress is introduced. Examples of temporal paths through the parameter space illustrate variations of the wage frontier. A single technique is initially uniquely cost-minimizing for all feasible rates of profits. Eventually, the technique...

I have made available a working paper with the post title. Abstract: This article presents an example in which perturbations in relative markups and technical progress result in variations in characteristics of the labor market. Around a switch point with a positive real Wicksell effect, a higher wage is associated with firms wanting to employ more labor per unit output of net product. Around a switch point with a reverse substitution of labor, firms in a particular industry want to hire...

Mariana Mazzucato's The Value of Everything: Making and Taking in the Global Economy is a popular book. She argues that we should change our ideas of what we consider productive and unproductive jobs and activities. She presents a brief overview of the history of economics focused on the classical and neoclassical theories of value, describes how Gross Domestic Product (GDP) is calculated from the System of National Accounts (SNA), examines how finance came to be mistakenly considered...

Figure 1: A Two-Dimensional Pattern Diagram1.0 Introduction This post continues this example of the application of pattern analysis to the study of fixed capital. I generalize the technology in the previous post. Technical progress can now proceed at different rates in the production and use of machines. I partition the resulting two-dimensional parameter space based on how the distribution of income, in the system of prices of production, alters the economically efficient length to run...

Figure 1: A Pattern Diagram1.0 Introduction In this example, I perturb parameters in an example of Bertram Schefold's. I was disappointed in that, as far as I can see, one can analyze the choice of technique in this example by the construction of the wage-rate of profits frontier. As far as I understand, this is not true for joint production in general. I guess I also need to find an example in which the physical life of a machine is at least three years so as to find a three-technique...