ebook img

The ABCs of political economy : a modern approach PDF

349 Pages·2014·4.79 MB·English
by  Hahnel
Save to my drive
Quick download
Download
Most books are stored in the elastic cloud where traffic is expensive. For this reason, we have a limit on daily download.

Preview The ABCs of political economy : a modern approach

The ABCs of Political Economy SSWW__773399__PPrreelliimmss..iinndddd ii 99//55//22001144 1122::2244::5511 AAMM SSWW__773399__PPrreelliimmss..iinndddd iiii 99//55//22001144 1122::2255::2222 AAMM The ABCs of Political Economy A Modern Approach Revised and Expanded Edition Robin Hahnel SSWW__773399__PPrreelliimmss..iinndddd iiiiii 99//55//22001144 1122::2255::2222 AAMM First published 2002; revised and expanded edition 2014 by Pluto Press 345 Archway Road, London N6 5AA www.plutobooks.com Copyright © Robin Hahnel 2002, 2014 The right of Robin Hahnel to be identified as the author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library ISBN 978 0 7453 3498 1 Hardback ISBN 978 0 7453 3497 4 Paperback ISBN 978 1 7837 1206 9 PDF eBook ISBN 978 1 7837 1208 3 Kindle eBook ISBN 978 1 7837 1207 6 EPUB eBook Library of Congress Cataloging in Publication Data applied for This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. Logging, pulping and manufacturing processes are expected to conform to the environmental standards of the country of origin. 10 9 8 7 6 5 4 3 2 1 Typeset in Minion by Swales & Willis, Exeter, Devon Text design by Melanie Patrick Simultaneously printed digitally by CPI Antony Rowe, Chippenham, UK and Edwards Bros in the United States of America SSWW__773399__PPrreelliimmss..iinndddd iivv 99//55//22001144 1122::2255::2244 AAMM Contents List of Illustrations xi Preface to the Revised and Expanded Edition xii 1 Economics and Liberating Theory 1 People and Society 1 The Human Center 2 Natural, Species, and Derived Needs and Potentials 2 Human Consciousness 3 Human Sociability 4 Human Character Structures 5 The Relation of Consciousness to Activity 6 The Possibility of Detrimental Character Structures 7 The Institutional Boundary 8 Why Must There Be Social Institutions? 9 Complementary Holism 11 Four Spheres of Social Life 11 Relations between Center, Boundary, and Spheres 13 Social Stability and Social Change 13 Agents of History 14 Applications 15 2 What Should We Demand from Our Economy? 20 Economic Justice 20 Increasing Inequality of Wealth and Income 20 Different Conceptions of Economic Justice 25 Efficiency 33 The Pareto Principle 34 The Efficiency Criterion 35 Seven Deadly Sins of Inefficiency 38 Endogenous Preferences 39 Self-management 41 SSWW__773399__PPrreelliimmss..iinndddd vv 99//55//22001144 1122::2255::2244 AAMM vi contents Solidarity 42 Variety 43 Sustainability 44 Weak versus Strong versus Environmental Sustainability 46 A Workable Definition of Sustainable Development 47 Growth 49 Conclusion 52 3 Efficiency and Economic Justice: A Simple Corn Model 53 Model 3.1: A Domestic Corn Economy 54 Situation 1: Inegalitarian Distribution of Scarce Seed Corn 57 Autarky 57 Labor Market 58 Credit Market 62 Situation 2: Egalitarian Distribution of Scarce Seed Corn 64 Autarky 64 Labor Market 65 Credit Market 66 Conclusions from the Domestic Corn Model 66 Generalizing Conclusions 70 Economic Justice in the Corn Model 72 Economic Justice, Exploitation, and Alienation 76 Occupy Wall Street 78 Model 3.2: A Global Corn Economy 79 4 Markets: Guided by an Invisible Hand or Foot? 83 How Do Markets Work? 83 What Is a Market? 83 The “Law” of Supply 84 The “Law” of Demand 84 The “Law” of Uniform Price 87 The Micro “Law” of Supply and Demand 87 Elasticity of Supply and Demand 90 The Dream of a Beneficent Invisible Hand 92 The Nightmare of a Malevolent Invisible Foot 95 Externalities: The Auto Industry 96 Public Goods: Pollution Reduction 99 SSWW__773399__PPrreelliimmss..iinndddd vvii 99//55//22001144 1122::2255::2244 AAMM contents vii Green Consumerism 101 The Prevalence of External Effects 102 Snowballing Inefficiency 106 Market Disequilibria 106 Conclusion: Market Failure Is Significant 108 Markets Undermine the Ties That Bind Us 109 5 Microeconomic Models 112 Model 5.1: The Public Good Game 112 Model 5.2: The Price of Power Game 114 The Price of Patriarchy 118 Conflict Theory of the Firm 120 Model 5.3: Climate Control Treaties 121 Model 5.4: The Sraffa Model of Income Distribution and Prices 130 The Sraffa Model 132 Technical Change in the Sraffa Model 135 Technical Change and the Rate of Profit 140 A Note of Caution 142 Producers and Parasites 142 6 Macroeconomics: Aggregate Demand as Leading Lady 147 The Macro “Law” of Supply and Demand 147 Aggregate Demand 150 Consumption Demand 152 Investment Demand 153 Government Spending 154 The Pie Principle 155 The Simple Keynesian Closed Economy Macro Model 156 Fiscal Policy 159 The Fallacy of Say’s Law 160 Income Expenditure Multipliers 162 Other Causes of Unemployment and Inflation 166 Myths about Inflation 169 Myths about Deficits and the National Debt 171 The Balanced Budget Ploy 174 Wage-Led Growth 176 SSWW__773399__PPrreelliimmss..iinndddd vviiii 99//55//22001144 1122::2255::2244 AAMM viii contents 7 Money, Banks, and Finance 179 Money: A Problematic Convenience 179 Banks: Bigamy Not a Proper Marriage 181 Monetary Policy: Another Way to Skin the Cat 186 The Relationship between the Financial and “Real” Economies 189 The Financial Crisis of 2008: A Perfect Storm 193 8 International Economics: Mutual Benefit or Imperialism? 200 Why Trade Can Increase Global Efficiency 201 Comparative, Not Absolute, Advantage Drives Trade 202 Why Trade Can Decrease Global Efficiency 205 Inaccurate Prices Can Misidentify Comparative Advantage 205 Unstable International Markets Can Cause Macro Inefficiencies 207 Adjustment Costs Are Not Always Insignificant 207 Dynamic Inefficiency 208 Why Trade Usually Aggravates Global Inequality 209 Unfair Distribution of the Benefits of Trade between Countries 209 Unfair Distribution of the Costs and Benefits of Trade within Countries 211 Why International Investment Could Increase Global Efficiency 214 Why International Investment Often Decreases Global Efficiency 215 Why International Investment Usually Aggravates Global Inequality 216 Open Economy Macroeconomics 219 International Currency Markets 219 Aggregate Supply and Demand in the Open Economy Model 221 Income Expenditure Multipliers in the Open Economy Model 221 Capital Flows in the Open Economy Model 222 Monetary Unions and the Eurozone 225 9 Macroeconomic Models 228 Model 9.1: Finance 228 Bank Runs 228 International Financial Crises 231 Conclusion 232 Model 9.2: Finance in Real Corn Economies 233 Banks in a Domestic Corn Model 233 Autarky 234 SSWW__773399__PPrreelliimmss..iinndddd vviiiiii 99//55//22001144 1122::2255::2244 AAMM contents ix Imperfect Lending without Banks 234 Lending with Banks When All Goes Well 235 Lending with Banks When All Does Not Go Well 235 International Finance in a Global Corn Economy Revisited 236 Model 9.3: Macroeconomic Policy in a Closed Economy 237 Model 9.4: Macroeconomic Policy in an Open Economy 243 An IMF Conditionality Agreement with Brazil 243 EC Austerity Policy and Greece 249 Model 9.5: A Political Economy Growth Model 251 The General Framework 251 A Keynesian Theory of Investment 254 A Marxian Theory of Wage Determination 255 Solving the Model 256 An Increase in Capitalists’ Propensity to Save 257 An Increase in Capitalists’ Propensity to Invest 258 An Increase in Workers’ Bargaining Power 258 Wage-Led Growth 258 10 What Is to Be Undone? The Economics of Competition and Greed 260 Myth 1: Free Enterprise Equals Economic Freedom 261 Myth 2: Free Enterprise Promotes Political Freedom 265 Myth 3: Free Enterprise Is Efficient 267 Biased Price Signals 267 Conflict Theory of the Firm 268 Myth 4: Free Enterprise Reduces Discrimination 269 Myth 5: Free Enterprise Is Fair 271 Myth 6: Markets Equal Economic Freedom 272 Myth 7: Markets Are Fair 275 Myth 8: Markets Are Efficient 275 What Went Wrong? 277 Neoliberal Capitalism in Crisis 279 11 What Is to Be Done? The Economics of Equitable Cooperation 281 Not All Capitalisms Are Created Equal 282 Keynesian Reforms 282 Taming Finance 282 Reducing Economic Injustice 290 SSWW__773399__PPrreelliimmss..iinndddd iixx 99//55//22001144 1122::2255::2244 AAMM

Description:
In the wake of the economic disasters of the past decade, perhaps we could all use a refresher course in economics to help us understand. The ABCs of Political Economy provides a lively and accessible introduction to modern political economy. In this compelling book, informed by the work of such emi
See more

The list of books you might like

Most books are stored in the elastic cloud where traffic is expensive. For this reason, we have a limit on daily download.