Showing papers in "International Journal of Social Economics in 1992"

Marxism and Humanism

Abstract: Criticizes the view that ethical judgements are completely separate from facts and theories in the social sciences. On the contrary, it argues that no project can be initiated nor any facts collected without some goal in mind and no important statement can be made in the social sciences without involving an ethical view. An ethical framework is one part of every social scientist′s paradigm (using the word in the sense of Thomas Kuhn) and we always work within that paradigm using those ethical values ‐even when social scientists claim to be purely “objective” with no ethical values in their work. Argues that Marx had an ethical view based not on any supernatural entity or imperative, but on the needs and desires of all of humanity. Marxist social science, like Institutionalist social science, is based on the view that every social science project must involve both factual research and an ethical framework.

Theories of Regulation and the History of Consumerism

Abstract: The “economic” (Chicago School) theory of regulation fails to explain many important features of regulatory history in the USA, such as the periodicity of regulatory innovation, the role of the organized consumer movement, and the roots of reform, including deregulation. J.Q. Wilson′s political theory of regulation accounts for these phenomena when interpreted in historical context. The widely‐held social values of Wilson′s theory are identified with the values articulated by the consumer movement. This theory suggests that regulation can indeed serve the public interest as understood from the perspective of consumerist values.

From Economic Growth to Human Development: A Commentary on Recent Indexes of Development

Abstract: Attempts to present a commentary on a few recent attempts at constructing a composite index of human development, and in the process briefly traces the trends in thinking that show marked shifts from economic growth to social development and to further human development. Shows that national income still remains an important indicator of overall development, and further, that various methodologies of compositing several indicators of development into one index produced broadly similar rank ordering of the nations.

Natural Morality and the Ideal Impartial Spectator in Adam Smith

Abstract: In the Theory of Modern Sentiments Smith distinguishes between the actual impartial spectator and the ideal; the man within the breast – a mechanism that allows Smith to extend the theory of moral approbation to judge the actions and motives of the agent himself. Argues that the significance of this is that Smith is then able to postulate standards of morality which are in some sense absolute, valid for all times and places. Shows that Smith deploys these absolute standards in evaluating how custom and tradition pervert the moral sentiments in some instances. This in turn allows him to legitimately speak of progress in human societies. Smith′s bias in favour of commercial society over the early and rude state is, therefore, rooted in his moral philosophy.

Do Value Judgements Affect Testing Economic Theory

Abstract: Analyses the influence of value judgements in the mechanics of testing econometric theories against empirical data. The orthodox view of mainstream, positive economics is that value judgements play no part in the above process. Contests this view; defines value judgements and shows the orthodox conception to be too narrow, compared with the meaning and use of the term in other disciplines. Reviews many published examples from the 1970s and 1980s and ways in which value judgements have affected testing procedures in economics. Hypothesis testing via econometric techniques is fraught with value judgements because the application of statistical methodology is not a determinate, neutral or objective process.

A Veblenian View of Minsky's Financial Crisis Theory

Abstract: Compares and contrasts the views of Hyman P. Minsky and Thorstein Veblen concerning the systematic development of financial crises in capitalistic economies. Advances the argument that Minsky and Veblen have both successfully met the challenge of providing a reasonable explanation for the speculative mania and related excesses critical to any theory of cyclical fluctuations. They agree that upturns tend to euphoria and ultimately, over‐capitalization and subsequent economic decline. Their rationales differ. Veblen stresses the effects of rising prices on collateral values and argues that the cumulative effect is over valued assets. Minsky seems to emphasize the ever‐growing fragility of financial structures. In the view of the authors, this article places Veblen′s contributions in a contemporary setting and ties Minsky more closely to the institutionalists.

Culture Evolution and the Process of Economic Evolution

Abstract: Essays a conceptural clarification and theory of the process of economic evolution Using the Veblenian matrix, conceptualizes the economic process in the framework of culture and its evolution Economic evolution, as a gestalt, comprises the processes of both economic growth (quantitative statics) and development (qualitative dynamics) The dynamics of culture evolution is founded on the advance of technology which constitutes the “core of culture” The essence of the process of culture evolution is contained in the dichotomy of useful knowledge The advance of useful knowledge appears in its application as technology and in its store as culture The process of economic evolution increases the capacity of culture and thereby enables humankind to take bigger and bigger bites of the infinity of knowledge Culture evolution, fed by the dynamics of the economic process, offers the potential for an enhanced “consciousness of the cosmos” and as such a conception of human progress

Do Government Transfers Crowd out Private Transfers to Non‐profit Organizations? The Israeli Experience

Abstract: Considers the importance of private contributions to not‐for‐profit organizations (NPOs) in capitalistic welfare states but notes that the share of national income donated to NPOs is significantly lower in Israel than in the USA. Focuses on donations to NPOs in Israel and provides an empirical analysis of the interrelationship of private donations and Government transfers to NPOs. Describes the analytical background relating private contribution to Government activity, examining particularly the possibility that Government expenditure exerts a “crowding‐out” effect on private contributions. Concludes that, with special reference to Israel, Government budgets and private donations to NPOs should co‐exist, in order to maximise the sources devoted to social services or to obtain an adequate variety of such services.

Factors Affecting Employment in the Arabian Gulf Region, 1975–85

Abstract: Assesses the main factors affecting employment in the Arab Gulf region. In particular: What are the main determinants of employment in the region? How do these determinants vary between national and foreign workforces? Have these determinants changed over time? The results, particularly for the 1980‐85 period, suggest that labour market mismatches may be increasing in the Arab World. This is essentially the problem of too many PhDs and too few mechanics. The symptom of this would be relatively high levels of disguised unemployment among the highly educated, coupled with a shortage of artisans. The damage arising from these skill mismatches lies in the way the various economic sectors are likely to expand while faced by labour constraints. These findings suggest that reforms of both the educational system and the hiring practices of Government agencies will be critical to restoring increases in productivity and ultimately expanded rates of non‐oil income.

Towards a New Model of Exploitation: The Case of Racial Domination

Abstract: Introduces a new approach to exploitation, and uses it to reinterpret the economic significance of racism, generally, and the underclass specifically. The extent of exploitation in labour processes is the product of two factors: whether workers have an “exit option” of ready alternative employment; and how completely labour exchanges specify the labour that will actually be done. The state of these two factors, in turn, depends on the social and historical setting of production. Uses this conception to reinterpret the effect of racism on economic outcomes – this suggests that the increasing number of permanently unemployed people in inner‐city ghettos have an important effect on the racially‐differentiated patterns of exploitation and on the overall level of exploitation in contrast with the perspective that the “underclass” is isolated from the rest of society.

Effects of Afghanistan War on Soviet Society and Policy

Abstract: Analyses the emergence of dialogue and dissent in Soviet society due to its decade‐long war in Afghanistan (1979‐89); the longest war in Soviet history. Included in the analysis are defence military posture in view of the military brutality, transfer of Soviet military practices to the occupation forces inside Afghanistan, ethnic tensions, racism and treatment of young conscripts. Perpetrations of atrocities against the Afghan population in violation of conventions of war are documented and tested against glasnost. Analyses exposure of the war in the Soviet media and through public debate.

Mechanistic Physiology and Institutional Economics: Jacques Loeb and Thorstein Veblen

Abstract: Discusses the correspondence and use of each other′s ideas of Loeb and Veblen which are seen to be significant both in understanding the evolution of their own thought and as commentary on the times.

Walter Eucken: Social Economist

Abstract: Eucken′s paradigm of a “social market economy” provides a framework for a functional free‐market mechanism, which not only accommodates development and change, but which also assures human dignity and freedom. Eucken places special emphasis on the integration of economics with “order” and “justice”. He holds that an unconstrained laissez‐faire economy does not assure a competitive economy but that it will degenerate into monopolistic practices. Eucken formulates his “structural” and “regulating” principles to facilitate a functionally competitive economy with a compatible social policy, to assure greater efficiency and to reduce poverty.

Towards a New Economic Order in the Countries of Central and Eastern Europe

Abstract: Political changes in the countries of Central and Eastern Europe have created both the preconditions as well as the need for the transition from the old to a new economic order. In the absence of any ready substitute, the institutional vacuum which arose plunged the majority of these countries into economic chaos and anarchy. A way of arresting this continuing drift towards chaos and political discontent is not to be found by striving for the reintroduction of laissez‐faire. A new stable economic order can be established only on the precepts of a just society. Suggests two alternatives delegating decision making in the sphere of economics to groups and formations outside parliament, or establishing a socially reponsible free market economy. The transition process probably would go through the phases: from plan to anarchy to group control to legally constrained market control.

Capital‐Labour Tensions and Liberal Economic Thought

Abstract: It was typical in nineteenth century economic thought to view the tensions between the interests of capital and labour as critical to industrial society. Yet later economic thought has generally reduced these tensions to those captured in contract theory. Explores how this narrowing of focus has cast an important source of contemporary social dynamics into the shadows. A broad survey is made of the various ways in which capital‐labour tensions are manifested in today′s advanced industrial economies, with special attention given to the case of the USA. Concludes with a discussion of how intensified international competitiveness, combined with our increasing distance from the threat of material privation, may force societies to restructure their economies so as to eliminate the source of capital‐labour tensions. The task facing liberal economic thought is to expand its scope to better provide guidance for meeting this challenge.

The Ethical Numeraire

Abstract: Develops an ethico‐economic general equilibrium system that is founded on a well defined ethically oriented choice of goods that imparts an ethical motivation to the activities of consumption, production and distribution. Shows that the choice of such a numeraire market basket and its related prices is instrumental on the polity‐market interaction, brought out as the heart of the problem, that is treating ethics as endogenous phenomena of the social order. The resulting ethico‐economic general equilibrium system is thereby found to be only locally stable, not globally stable in its equilibria, which are all policy induced and market driven, perturbed and unsettling as polity evolves.

On Trusts and Technostructures: Veblen, Berle and Means, and Galbraith

Abstract: Discusses and analyses Veblen′s views on corporate ownership and control and on the risk of a professional managerial class of engineers and experts. Veblen′s views are compared with those of Berle and Means and of J.K. Galbraith.

A Comparative Analysis of Selected Economic Methodologies: Praxeology, Positivism and Institutionalism

Abstract: Explicates and analyses selected economic methodologies: praxeology, positivism and institutionalism. Praxeology is a rationalistic methodology which utilizes deductive logic to deduce conclusions concerning economic behavior from postulates, which are self‐evident truths, but praxeologists deny that empirical verification is either necessary or desirable. Positivism is a methodology which combines deductive rationalism as a method of deriving substantive hypotheses and inductive empiricism as a method of verifying these hypotheses. Institutionalism is a pragmatic methodology which is based on an empirical epistemology and which utilizes inductive logic to formulate economic policy and to solve practical problems. Concludes that institutionalism is more empirically relevant than either praxeology or positivism, and that, therefore, institutionalism is superior to the other methodologies.

Keynes on the Socialization of Investment

Abstract: Explores Keynes′s long‐term policy proposals as social reform. Using early unpublished philosophical papers of Keynes, the argument is that Keynes′s long‐term policy proposals focused on reconciling “being good” and “doing good”. The socialization of investment was meant to bring about this reconciliation.

Can Economic Systems be Chosen? History, Values and Human Nature

Abstract: Neither Marxists and Hegelians nor most supporters of market economies believe that we can really choose an economic system. Historical laws and economic realities undermine our attempts. Explores the problem of predicting any human future and examines background views of human nature which influenced classical economics. Revives Malebranche′s view that man is necessarily an ordering creature. Man must make decisions, but tends towards a natural good which would be instantiated in a social system which reconciled self‐interest and the public interest so that everyone′s rational needs and reasonable desires were given proper weight. In these terms there are choices we can make, especially about how property is to be used and shared.

The Social Economist Hankers after Values: A Collection of Essays

Abstract: A collection of essays by a social economist seeking to balance economics as a science of means with the values deemed necessary to man′s finding the good life and society enduring as a civilized instrumentality. Looks for authority to great men of the past and to today′s moral philosopher: man is an ethical animal. The 13 essays are: 1. Evolutionary Economics: The End of It All? which challenges the view that Darwinism destroyed belief in a universe of purpose and design; 2. Schmoller′s Political Economy: Its Psychic, Moral and Legal Foundations, which centres on the belief that time‐honoured ethical values prevail in an economy formed by ties of common sentiment, ideas, customs and laws; 3. Adam Smith by Gustav von Schmoller – Schmoller rejects Smith′s natural law and sees him as simply spreading the message of Calvinism; 4. Pierre‐Joseph Proudhon, Socialist – Karl Marx, Communist: A Comparison; 5. Marxism and the Instauration of Man, which raises the question for Marx: is the flowering of the new man in Communist society the ultimate end to the dialectical movement of history?; 6. Ethical Progress and Economic Growth in Western Civilization; 7. Ethical Principles in American Society: An Appraisal; 8. The Ugent Need for a Consensus on Moral Values, which focuses on the real dangers inherent in there being no consensus on moral values; 9. Human Resources and the Good Society – man is not to be treated as an economic resource; man′s moral and material wellbeing is the goal; 10. The Social Economist on the Modern Dilemma: Ethical Dwarfs and Nuclear Giants, which argues that it is imperative to distinguish good from evil and to act accordingly: existentialism, situation ethics and evolutionary ethics savour of nihilism; 11. Ethical Principles: The Economist′s Quandary, which is the difficulty of balancing the claims of disinterested science and of the urge to better the human condition; 12. The Role of Government in the Advancement of Cultural Values, which discusses censorship and the funding of art against the background of the US Helms Amendment; 13. Man at the Crossroads draws earlier themes together; the author makes the case for rejecting determinism and the “operant conditioning” of the Skinner school in favour of the moral progress of autonomous man through adherence to traditional ethical values.

Schmoller's Political Economy: Self‐interest versus the Higher Law

Abstract: Schmoller reserves his admiration for those entrepreneurs who succeeded in the acquisition of wealth but whose primary goal was the promotion of the public interest. Such individuals as List, Steiner, Geibel, Abbe and von Mevissen are of this sort. Schmoller is lavish in his praise of them. Schmoller is critical of the natural economy of Adam Smith where each individual is activated by his own self‐interest. Schmoller sees in the higher law a guide to human behaviour. Moneymakers are not necessarily men of great talent. For this reason Schmoller prefers the man who is driven by the pursuit of idealistic goals. Schmoller′s historical approach to the political economy, one shared by some in the Western world, is to be contrasted with the view that the best type of social order permits the individual to pursue his self‐interest and that such a pursuit is in keeping with the social interest.

Socialism and its Future in the Post‐Soviet Era

Abstract: Provides an overall assessment of problems and prospects for socialism (at a time of the abolition of the old Union of Soviet Socialist Republics and creation of a new “Commonwealth of Independent States”) by examination of three central themes. First, it is shown that because the old Soviet regime departed substantially from the classic conceptualizations of socialism, its demise does not demonstrate a “failure” of socialism or a “victory” of capitalism. Second, dissolution of the old regime does demonstrate serious problems in the actual, over‐centralized, authoritarian, state‐directed Soviet economy. Third, partly because of the confusion between an authentic socialism and the actual Soviet regime, prospects for socialism seem very slim. But socialist ideals of democracy and equality are deeply embedded in the popular psyche and will continue to affect the character and pace of social change.

Can Perestroika Still be Reformed

Abstract: Current events in the Soviet Union cannot be understood without comprehending the nature of Soviet communism. Begins with a description of the system singlehandedly imposed on the Soviet Union by Lenin and Stalin, focusing on the key elements of Marxist‐Leninist ideology and the nomenklatura. Brings to light a seldom‐recognized characteristic of communist governments, which is obscured by official propaganda, that Marxism‐Leninism is firmly grounded on “science”. It involves the rejection, by communist policy makers, of any coherent intellectual framework which would guide and also explain their actions. This, however, is not surprising, because any theoretical blueprint would force these leaders to spell out the precise goals they are pursuing, as well as the costs (to whom?) and the benefits (also to whom?) of their actions. It would, additionally, make the communist party accountable for its policies, a fact that would represent an intolerable restriction of its practically unlimited power. Perestroika...

A Comparison of Privatization in Capitalist and Socialist Countries

Abstract: Reports intensive country studies conducted for a sample of ten countries – five historically socially planned and five predominantly market economies – for comparative analyses of socioeconomic‐political characteristics prior to privatization. Purpose was to discern if there were any common factors descriptive of capitalist and/or socialist countries prior to privatization. Constructs from a common set of factors descriptive of all the economies in the sample prior to initiation of privatization, a general model of preconditions for privatization. Results of limited testing appeared to lend credence to the model.

On Some Aspects of the Soviet‐type Development

Abstract: Attempts to find answers to such theoretical questions as the character of Soviet‐type societies and the major tendency of their development. Argues that, as long as the analysis is conducted in convenient and extreme terms of “either capitalism or socialism or communism”: as long as the yardstick for the comparison remains capitalism of laissez‐faire; and as long as the general trend and the particular forms of the world economic development are ignored ‐no satisfactory answer to the nature and fate of such societies can be found. If, however, one looks at Soviet‐type systems as socio‐economic and political structures destined to solve the problem of the industrial revolution and modernization of backward and peasant nations under the conditions of the twentieth century, then the enigma disappears. Soviet‐type societies become what they are in reality: a variety of capitalism that, having fulfilled the “archaic” act of industrialization, is moving into its post‐industrial era.

Marx on Man's Sociality by Nature: An Inexplicable Omission?

Abstract: Documents and notes the specific content of Marx′s postulate (in the original German edition of Das Kapital, 1867) that “der Mensch von Natur...ein gesellschaftliches thier ist”. All the prominent English editions (unlike the French, Russian, Italian and Spanish versions examined) except one omit the “by nature” qualifier. Suggests reasons for and the significance of this critical and essentially mysterious omission.

Alfred Marshall on the Structural and Behavioural Properties of Social Institutions

Abstract: Makes and attempts to substantiate, the following claims: It was Marshall′s objective to show how poverty could be ameliorated. He located the causes of poverty in the institutions of the state, education, monopoloid business enterprise, and the working‐class family. He viewed institutions as structures and as organized social behaviour. He explained that the latter is conditioned by customs. Some of these are rooted in the legend‐enshrouded past and hence change‐resisting. Other customs are change‐promoting by virtue of being engendered in scientific, technological, and educational processes. Marshall recommended that the state be reformed through a strengthening of democratic processes and that this be followed by state‐engineered reform of monopoloid institutions and of educational institutions. These reforms would result in increased institutionalization of dynamic behaviour and accelerated deinstitutionalization of static behaviour. The outcome would be an increase in welfare. Because of his recommen...

Economics of the Golden Mean: A Preliminary Enquiry

Abstract: The importance of the golden mean or moderation in daily human life has been advocated almost universally by all the great teachers of the world. In the sphere of economics, however, it seems to have been largely ignored. Determines whether preliminary evidence can be found to give some support to the golden mean in economics. Uses the data for the 50 states of the USA, and the preliminary finding indicates that ideologically moderate (golden mean) states do seem to perform better than conservative states. But liberal states fare still better. One possible explanation for this is that liberal states in the USA are really moderates in the ideological spectrum of the world.

The Political Economy of Left and Right During China's Decade of Reform

Abstract: During the decade of the 1980s, the design and implementation of economic reforms had divided the Chinese leadership into two factions: conservative proponents of moderation and “circumscribed” economic reform, and liberal proponents of comprehensive and rapid economic and social reform. Seeks to identify the economic‐theoretic core of leftist and rightist positions. The leftist position described is centred on the works of Chen Yun, Sun Yefang, and Zue Muqiao and explicitly excludes the idealistic and revolutionary political theories of Maoism, focuses instead on the more pragmatic goals of rational central economic planning. The rightist position became identified with Zhao Ziyang and his vision of mixed market socialism which, in the minds of his opponents, came dangerously close to capitalism. As the Chinese economy faltered toward the end of the decade, the conflict between leftist hard‐line conservatives and rightist liberals heightened, leading to the pro‐democracy movement of 1989 and its aftermath.