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Both neoclassical and Keynesian economists have widely favored the use of equilibrium models to understand economic activity, but dramatic periods of change such as the current global economic downturn are poorly understood by assuming equilibrium. The economist Joseph Schumpeter tried to inject dynamism and disequilibrium into economic models by arguing for the role of entrepreneurs in creating microeconomic change, and for examining long-term macroeconomic change as represented in business cycles. No economist, including Schumpeter, has ever connected these two approaches to change and these approaches are not typically used as alternative and complementary ways of viewing transformation over time. We suggest that these theories can be connected in a “mesoeconomic” institutional analysis rooted in economic sociology; we demonstrate this connection by examining the US commercial building industry. This industry has changed in qualitatively distinct ways over the past two centuries in what we call market orders, economic orders sometimes lasting for decades or more. In each market order, entrepreneurs of different sorts are able to flourish and push forward institutional changes that result in long-term economic shifts. Credit and finance have been pivotal influences in each market order, a factor supporting Schumpeter's focus on entrepreneurial action and speculation and one not largely discussed today. We view the recent disruption of financial markets as a signal of the destruction of a reigning market order.

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.

Nobody concerned with political economy can neglect the history of economic doctrines. Structural changes in the economy and society influence economic thinking and, conversely, innovative thought structures and attitudes have almost always forced economic institutions and modes of behaviour to adjust. We learn from the history of economic doctrines how a particular theory emerged and whether, and in which environment, it could take root. We can see how a school evolves out of a common methodological perception and similar techniques of analysis, and how it has to establish itself. The interaction between unresolved problems on the one hand, and the search for better solutions or explanations on the other, leads to a change in paradigma and to the formation of new lines of reasoning. As long as the real world is subject to progress and change scientific search for explanation must out of necessity continue.

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.

Allyn Young′s lectures, as recorded by the young Nicholas Kaldor, survey the historical roots of the subject from Aristotle through to the modern neo‐classical writers. The focus throughout is on the conditions making for economic progress, with stress on the institutional developments that extend and are extended by the size of the market. Organisational changes that promote the division of labour and specialisation within and between firms and industries, and which promote competition and mobility, are seen as the vital factors in growth. In the absence of new markets, inventions as such play only a minor role. The economic system is an inter‐related whole, or a living “organon”. It is from this perspective that micro‐economic relations are analysed, and this helps expose certain fallacies of composition associated with the marginal productivity theory of production and distribution. Factors are paid not because they are productive but because they are scarce. Likewise he shows why Marshallian supply and demand schedules, based on the “one thing at a time” approach, cannot adequately describe the dynamic growth properties of the system. Supply and demand cannot be simply integrated to arrive at a picture of the whole economy. These notes are complemented by eleven articles in the Encyclopaedia Britannica which were published shortly after Young′s sudden death in 1929.

Austrian economist Ludwig Mises’s central role in the socialist calculation debates has been consensually acknowledged since the early 1920s. Yet, only recently Nemeth, O’Neill, Uebel, and others have drawn particular attention to Mises’s encounter with logical empiricist Otto Neurath. Despite several surprising agreements, Neurath and Mises certainly provide different answers to the questions “what is meant by rational economic theory” (Neurath) and whether “socialism is the abolition of rational economy” (Mises). Previous accounts and evaluations of the exchange between Neurath and Mises suffer from attaching little regard to their idiosyncratic uses of the term “rational.” The paper at hand reconstructs and critically compares the different conceptions of rationality defended by Neurath and Mises. The author presents two different resolutions to a detected tension in Mises’s deliberations on rationality: the first is implicit in Neurath’s, O’Neill’s, and Salerno’s reading of Mises and faces several interpretational problems; the author proposes a divergent interpretation. Based on the reconstructions of Neurath’s and Mises’s conceptions of rationality, the author suggests some implications with respect to Viennese Late Enlightenment and the socialist calculation debates.

Of all the various interventions into the market economy, which have been invented and implemented by man and state, those that historically have caused the gravest consequences in the advanced industrialized economies surely are the inflationist policies, which lead inexorably to the business cycle in all of its various aspects and manifestations. In this paper, we shall attempt to trace through a number of socio-economic consequences and implications of the business cycle. We are convinced that ultimately the business cycle has political implications, which are just as far reaching and grave as its numerous economic consequences.

In 1974, the UN General Assembly adopted a landmark resolution proclaiming the establishment of a New International Economic Order. One of the basic aims of this declaration was to enhance the voice and participation of developing countries in the international economic decision-making process based on norms of equitable governance. More than four decades have passed since its adoption. This paper aims to reflect on the past 43 years of the global financial regulatory system in light of the notion of equitable governance as envisioned by the “New International Economic Order”.

This paper surveys the global financial regulatory system from the vantage point of equitable economic governance. This discussion covers the period that comes after the 1974 UN landmark resolutions that declare the establishment of a “New International Economic Order”. The authors use qualitative and quantitative approach in this study. They use descriptive statistics and intuitive discussions of certain cases to carry the objective of the paper forward.

First, part of the development in global financial regulation manifests the establishment of informal networks that embark on global regulatory issues, while being very exclusive in their membership policies. Second, the lack of full and effective participation of developing countries in the decision-making and norm setting remains unsolved in the global financial regulatory system. Third, the shadow role of the World Bank and International Monetary Fund was of great significance in assisting the implementation of non-binding regulatory rules of international finance in developing countries despite the concerns of legitimacy and equity in the making of international standards. In sum, the global financial regulatory system that emerged in the past four decades is quite different from that aspired by the NIEO.

The declaration of NIEO coincides with the collapse of the Bretton Wood’s fixed exchange rate which in turn leads to the emergence of a new financial system and regulatory development. This period marked the proliferation of informal networks that make policy recommendations or non-binding rules with global implications. As far as the literature review goes far, this paper is the first to survey the post Bretton Wood’s period of the global financial regulatory architecture based on the tenets of the “New International Economic Order”.

Argues that different elements in Eucken′s work have had insufficient attention in post‐war Germany, in science as well as in political practice. In Eucken′s thinking, order (especially order in the economic and political field and the interconnection between them) is the central concept. In politics, insufficient attention was paid to the interdependence between the different orders, and the balance of freedom and power. Politics was characterized by pragmatism. A principal decision in favour of the Wettbewerbsordnung (an economic order based on competition), advocated by Eucken, was never made. This was expressed in insufficient fighting against the formation of economic power (competition policy) and in a neglect of the environment. Compares the social philosophies of Eucken and Hayek.