Robert Vienneau: Thoughts Economics

Coefficients for Iron-Production in the Leontief Input-Output Matrix I have uploaded a working paper with the post title. Abstract: This note demonstrates that the special case condition, needed for a simple labor theory of value, of equal organic compositions of capital does not suffice to determine technology. Prices do not vary across techniques for both techniques in a numeric example of a two-commodity linear model of production, and they are proportional to labor values. Both...

Figure 1: Fluke Switch Points on Each Axis1.0 Introduction I have developed an approach for finding examples in which either two fluke switch points exist on the wage frontier or a switch point is a fluke in more than one way. This post presents a numerical example with two fluke switch points on the frontier. Not all examples generated by this approach are necessarily interesting, although I find the approach of interest. I don't think the example in this approach is all that...

Figure 1: An Example Of Braess' Paradox Braess' paradox arises in transport economics, a field for applied research in economics. I was inspired by the example in Fujishige et al. (2017) for the example in this post. Under Braess' paradox, an improvement to a transport network, and thus an increase in the number of choices available to users of the network, results in decrease performance. In reliability engineering, one says such a transport network is not a coherent system. A transport...

A Bifurcation Diagram with Two Temporal Paths I have a working paper with the post title. Here's the abstract: This article illustrates the application of bifurcation analysis to structural economic dynamics with a choice of technique. A numerical example of the Samuelson-Garegnani model is presented in which technical change is introduced. Examples of temporal paths through the parameter space illustrate variations of the wage frontier. A single technique is initially uniquely...

A July 24 Jonathan Schlefer article, "Market Parables and the Economics of Populism: When Experts are Wrong, People Revolt", in Foreign Affairs. Schlefer cites the Cambridge Capital Controversy as a demonstration that the neoliberal political project of remaking the world around unembedded markets is doomed to failure. A September 11 interview with Daniel Kahneman in which he basically credits Richard Thaler with inventing behavioral economics. (In his memoirs, Misbehaving, Thaler is also...

In Production of Commodities by Means of Commodities, Sraffa writes: "others have from time to time independently taken up points of view which are similar to one or other of those adopted in this paper and have developed them further or in different directions from those proposed here." -- P. Sraffa (1960): pp. vi - vii. Who is Sraffa talking about? I suggest the following, and their works, at least: Tjalling C. Koopmans (1957). Three Essays on the State of Economic Science. New York:...

This post, unfortunately, is inspired by current events. Economists can provide guidance on disaster recovery - for example, from earthquakes and hurricanes. Economists, for a long time, have been developing input-output models of local economies and interactions between them. I think of Walter Isard as a pioneer here. Such models are of practical importance to my post topic. Regional input-output models can describe disasters with either a supply-side or demand-side approach. In a...

Dean Baker has a new book out: Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer. It recounts how laws that define property, markets, and so on have been rewritten, over the last fifty years, to accomplish an upward redistribution of income. This bias for the rich contrasts with the effects of the rules of the game in the half-century golden age following World War II. This is the same theme as Robert Reich's Saving Capitalism: For the...

Figure 1: A Bifurcation Diagram I have previously illustrated a case in which real Wicksell effects are zero. I wrote this post to present an argument that that example is not a matter of round-off error confusing me. Consider the technology illustrated in Table 1. The managers of firms know of three processes of production. These processes exhibit Constant Returns to Scale. The column for the iron industry specifies the inputs needed to produce a ton of iron. Two processes are known for...