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As Bruce Caldwell (2007, p. 1) notes, Hayek's classic text had a “decidedly inauspicious” beginning. In spring 1933, Hayek wrote a memorandum (Nazi socialism) to Sir…
As Bruce Caldwell (2007, p. 1) notes, Hayek's classic text had a “decidedly inauspicious” beginning. In spring 1933, Hayek wrote a memorandum (Nazi socialism) to Sir William Beveridge – then Director of the London School of Economics – arguing that National Socialism represented the “culmination” (Hayek,  2007, p. 245) of earlier pro-socialist trends. As Hayek puts it, National Socialism was[The] ultimate and necessary outcome of a process of development in which the other nations have been for a long time steadily following Germany…The gradual extension of the field of state activity, the increase in restrictions on international movements of both men and goods, sympathy with central economic planning and the widespread playing with dictatorship ideas, all tend in this direction. (Hayek,  2007, p. 248, italics added)
Holbrook Working (1949) discovered that the percentage change in futures prices seemed to be largelyrandom. This led Paul Samuelson (1965) to develop the Efficient Market Hypothesis (EMH) which claims that the current spot and futures1 prices fully reflect all relevant information. Furthermore, because the future flow of information cannot be anticipated, price changes will not be serially correlated. These papers linked the notion of randomness of price changes to informational efficiency. From that point on, a major part of the empirical studies of asset markets has been the application of time series analysis to asset prices, in order to evaluate whether the price changes are random and whether futures prices reflect all available information. As the statistical tests became more sophisticated, the number of empirical studies increased and the results became more contradictory and difficult to interpret. An economic theorist can only be bemused by contemplating the empirical/econometric studies in the finance literature.
Seeks to demonstrate that the Talmudic scholars possessed theoretical knowledge and practical experience regarding the market phenomenon of business disturbances, recognizing the existence of a causal relationship between the physical determinants of the cycles of the weather patterns and the fortunes of the agricultural sector, a condition which affected the economy as a whole. Discusses this linkage with respect to the insights in Johanan′s works. These come close to Hawtrey′s view of the business cycle as a monetary phenomenon, on the one hand, and Samuelson′s discussion of “supply shock” as a result of “...droughts and crop failures in agriculture”, on the other. Johanan also recognized the existence of a quantitativerelationship between money and prices, and prices and incomes. This suggests that the Talmudic scholars had come to appreciate the fundamentals of what was later to emerge as the quantity theory of money.
Looks at the impact John Maynard Keynes and the movement (Keynesian) he started had on the theory and practice of economics in the 1930s and onwards. Identifies respective…
Looks at the impact John Maynard Keynes and the movement (Keynesian) he started had on the theory and practice of economics in the 1930s and onwards. Identifies respective problems about capitalism and discusses them in depth. States that the monetary and fiscal policies recommended by Keynes have helped the West escape severe social consequences in the aftermath of the Great Depression. Goes on to show how economists after Keynes carried his work forward and upward in the 1940s and 1950s. Closes by stating there is a further, third revolution in economic thinking on the rise.
This paper is devoted to the question of what motivates man in his pursuit of economic activities. Particular attention is given to the notion that economic activities of…
This paper is devoted to the question of what motivates man in his pursuit of economic activities. Particular attention is given to the notion that economic activities of individuals may not be motivated by their self‐interest alone.
Using literary analysis, the paper first reconsiders the role of self‐interest and non‐selfish motives in the historical schools. Then it is demonstrated that at least some non‐selfish motives were incorporated in the voluntary exchange theory of public economy. Next it is shown that during the evolution of the theory of public goods these non‐selfish motives were lost and that the modern theory of public goods rests entirely on the self‐interest hypothesis. However, over the last two decades results of public goods experiments have cast considerable doubt on the pure self‐interest hypothesis.
A major finding of this paper is that several non‐selfish motives of man that show up in recent public goods experiments were already discussed by representatives of the historical schools.
An agenda for future research on the topic is sketched in the final section.
Practical implications include that the allocation of many goods, not just public goods, may improve if agents pay more attention to non‐selfish motives of man.
The paper adds to the existing body of related writings by linking developments in the evolution of theory of public goods, in particular recent findings from public goods experiments, to a specific aspect already advocated by representatives of the historical schools, that is, the notion that man in his pursuit of economic activities is not motivated by his self‐interest alone. To this extent, the paper is of interest for researchers working on public goods theory, experimental economics and the history of economic thought.
The purpose of this article is to suggest a solution to the quandary from which the economist appears unable or unwilling to extricate himself. The quandary is his own production. On the one hand, the economist is jealous of his position as scientist, a disinterested pursuer of the truth, and on the other hand, he has an irresistible urge to use his knowledge as an economist for the purpose of relieving society, and, indeed, civilisation of its social ills. To suggest how social ills may be cured is to define goals to be reached. To choose goals is to make value judgements. There is no quandary where the economist as economist simply makes value judgments and still adopts the posture of the scientist. Such dualism, however, incurs the displeasure of those of a critical turn of mind. It actually brings forth censure and suggestions that value judgments should be openly made.
This paper discusses the American debate over price controls and economic stabilization after World War II, when the transition from a war economy to a peace economy was…
This paper discusses the American debate over price controls and economic stabilization after World War II, when the transition from a war economy to a peace economy was characterized by bottlenecks in the productive system and shortages of food and other basic consumer goods, directly affecting the living standard of the population, the public opinion, and political discourse. Specifically, we will focus on the economist Franco Modigliani and his proposal for a “Plan to meet the problem of rising meat and other food prices without bureaucratic controls.” The plan prepared by Modigliani in October 1947 was based on a system of taxes and subsidies to foster a proper distribution of disposable income and warrant a minimum meat consumption for each individual without encroaching market mechanisms and consumers’ freedom. We will discuss the contents of the plan and its further refinements, and the reactions it prompted from fellow economists, the public opinion, and the political world. Although the Plan was not eventually implemented, it was an important initiative for several reasons: first, it showed the increasing importance of fiscal policy among postwar government tools of intervention in the economic sphere; second, it showed a third way between direct government intervention and full-fledged laissez faire, in tune with the postwar political climate; third, it proposed a Keynesian macroeconomic approach to price and income stabilization, strongly based on econometric and microeconomic foundations. The Meat Plan was thus a fundamental step in Modigliani’s effort to build the “neoclassical synthesis” between Keynesian and Neoclassical economics, which would deeply influence his own career and the evolution of academic studies and government practices in the United States.
The purpose of this paper is to address the core concept of docility in Simon’s learning theories and elaborate docility as a missing link in organizational performance…
The purpose of this paper is to address the core concept of docility in Simon’s learning theories and elaborate docility as a missing link in organizational performance structures. In his book, Administrative Behavior, first published in 1947 with three subsequent editions, Herbert A. Simon introduced a new concept to the emerging field of organizational theory, docility.
In Administrative Behavior, Herbert A. Simon introduced to management and organization theorists the concept of docility. Simon adopted the concept and meaning from E.C. Tolman’s (1932) classic work, Purposive Behavior in Animals and Men, and his novel views on learning processes and key concepts like purpose (goals), thought processes (cognitive psychology) and cognitive maps. This paper elaborates on docility mechanisms and the implications for social learning in organizations.
This paper addresses this lacuna in the organizational literature, and the implications for current theories of organizations and organizational learning.
Docility is a tool to link individual learning with organizational learning in complex environments and changing technologies.
The paper traces origins of Simon’s docility and learning theories.