Introducing a New Economics , livre ebook

Introducing a New Economics
Introducing a New Economics
Pluralist, Sustainable and Progressive
Jack Reardon, Maria Alejandra Madi and Molly Scott Cato
First published 2018 by Pluto Press
345 Archway Road, London N6 5AA
www.plutobooks.com
Copyright Jack Reardon, Maria Alejandra Madi and Molly Scott Cato 2018
The right of Jack Reardon, Maria Alejandra Caporale Madi and Molly Scott Cato to be identified as the authors of this work has been asserted by them 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 3489 9 Hardback
ISBN 978 0 7453 3488 2 Paperback
ISBN 978 1 7837 1217 5 PDF eBook
ISBN 978 1 7837 1219 9 Kindle eBook
ISBN 978 1 7837 1218 2 EPUB eBook





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.
Typeset by Stanford DTP Services, Northampton, England
Simultaneously printed in the United Kingdom and United States of America
Contents
List of Boxes, Figures and Tables
Acknowledgements
Preface
1. Introducing Economics with a Judicious Mix of Pluralism, Sustainability and Justice
1.1 What is Economics?
1.2 How Economics Relates to the Other Social Sciences
1.3 Different Ideologies (or Schools of Thought) Within Economics
1.4 Sustainability, Pluralism, Justice: the Central Themes of this Book
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
2. Knowledge and the Construction of Economic Models
2.1 What is Knowledge and How is it Obtained?
2.2 What Are the Proper Tools to Acquire Knowledge?
2.3 How Does One Acquire Knowledge?
2.4 How Can We Ensure that Knowledge is Not Used for Socially Destructive Ends?
2.5 Models and Their Usefulness in Economics
2.6 Elements of a Model
2.7 Neoclassical Economics and the Concept of Equilibrium
2.8 The Importance of Time in Economics
2.9 Economics and Complexity Theory
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
3. Sustainability, Resources and the Environment
3.1 Living Within Our Means
3.2 Thomas Malthus Essay on Population and the Great Land Grab
3.3 Karl Polanyi and The Great Transformation
3.4 Resources, or Factors of Production
3.5 Demand, Scarcity, Sufficiency and Abundance
3.6 Technique 1: Understanding Basic Market Forces
3.7 Technique 2: Calculating Elasticity
3.8 Meeting Our Needs
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
4. Power and the Distribution of Resources
4.1 Understanding Power in an Economic Context
4.2 Power and Institutions
4.3 Karl Marx on Power
4.4 The Commodification of Natural Resources
4.5 Defining Property Rights and Private Property
4.6 Climate Change, Population Growth, Energy Use and Water
4.7 Conclusion
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
5. Inequality, Poverty and Disempowerment
5.1 Poverty: Definitions and Concepts
5.2 Poverty and the Developing World
5.3 Measuring Poverty
5.4 Poverty Alleviation
5.5 Income Inequality
5.6 Recent Global Trends in Poverty and Inequality
5.7 Women and Poverty
5.8 Poverty and Climate Change
5.9 Women and Climate Change
5.10 Global Migration and Remittances
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
6. Livelihoods and Work
6.1 What Is Work?
6.2 The Changing Nature of Work
6.3 The Internet of Things: The Third Industrial Revolution
6.4 Developing Countries and the Informal Economy
6.5 Unpaid Work and Family Care
6.6 Work and Social Security
6.7 Basic Income
6.8 Sustainable Work
6.9 Sustainable Work and Corporate Social Responsibility
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
7. Unemployment and Employment
7.1 The Shifting Definition of Unemployment
7.2 Technique 3: Calculating the Unemployment Rate, the Employment Rate and the Labour Force Participation Rate
7.3 Employment Trends in Labour Markets
7.4 The Causes of Involuntary Unemployment
7.5 Keynes on Effective Demand
7.6 Policy Analysis: Conceptualisation of Unemployment
7.7 Financialisation of Capital and Unemployment
7.8 The Minimum Wage and the Living Wage
7.9 Measuring Decent Work
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
8. Money
8.1 What is Money?
8.2 Who Controls Money?
8.3 Money, Debt and Exponential Growth
8.4 Technique 4: Compounding Interest
8.5 Money and Capital
8.6 Booms and Busts; Bubbles and Bulbs
8.7 Local Currencies: A Fad or the Wave of the Future?
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
9. Economic Value
9.1 Controversies on the Sources of Economic Value
9.2 Joan Robinson: the Production Function and the Cambridge Capital Controversy
9.3 Inflation and Deflation
9.4 Technique 5: Comparing Costs and Benefits
9.5 Technique 6: Discounting
9.6 Technique 7: Discounting and the Concept of Present Value
9.7 Valuing Nature and the Idea of Ecosystem Services
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
10. Firms, Industries and Markets
10.1 What is a Firm?
10.2 Defining a Corporation
10.3 What is an Industry?
10.4 Is There an Ideal Industry Structure?
10.5 Technique 8 : Conducting a Stakeholder Analysis
10.6 Externalities
10.7 Conclusion
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
11. Economic Democracy
11.1 Who Owns the Economy?
11.2 Public Goods
11.3 Elinor Ostrom and Managing the Commons
11.4 Cooperatives and Worker-managed Firms
11.5 The John Lewis Partnership
11.6 A Participatory Economy
11.7 The Solidarity Economy in Latin America
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
12. Economic Governance
12.1 A Market Within a Social and Ecological Framework
12.2 A Quick Look at US Antitrust Legislation
12.3 Measuring What Matters
12.4 When, Why and by Whom was GDP Constructed?
12.5 Technique 9: Calculating GDP
12.6 Alternatives to GDP
12.7 Technique 10: Calculating GPI and HDI
12.8 Government s Role in the Economy
12.9 Fiscal and Monetary Policy
12.10 Financing for Development: Small Business Challenges
12.11 Livelihoods and Food Security
12.12 Developing a Green Economy
12.13 The Infant Industry Argument
Thinking Questions
Class Activity
Areas for Research
UN SDG Focus
Further Reading
13. Consumption, Investment and Savings
13.1 Household Consumption
13.2 The Marginal Propensity to Consume
13.3 Consumption and Credit in Brazil
13.4 Linking Investment and Consumption: Introducing the Spending Multiplier
13.5 Technique 11: Calculating the Multiplier
13.6 Investment
13.7 A Brief Note on Friedrich von Hayek (1899-1992)
13.8 Keynes and Kalecki on Effective Demand
13.9 Technique 12: A Kaleckian Approach to Consumption, Investment and Income Distribution
13.10 The Financial Conception of Investment
13.11 Finance, Funding and Investment
13.12 Government Expenditure: Consumption, Investment and the Budget Cycle
13.13 Theoretical Summary of Consumption and Investment from a Sustainable Perspective
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
14. Recessions and Financial Crises
14.1 Setting the Scene: What is a Business Cycle?
14.2 How Are Recessions Defined and Measured in the USA?
14.3 The Business Cycle and Financial Crises
14.4 Financial Crisis and Social Costs in Emerging Countries: Indonesia in the Late 1990s
14.5 Banking: A Simplified Balance Sheet
14.6 Financial Innovations and Liability Management: the Active Role of Banks
14.7 The American Housing Crisis and the Banking Sector
14.8 Financial Liberalisation and Systemic Risk
14.9 The Government and the Business Cycle: Alternative Economic Policies
14.10 A Theoretical Note on Long-term Economic Cycles
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
15. Justice, Political Economy, Global Development and Governance
15.1 Justice and Injustice
15.2 The Political Economy of Development and the Pursuit of Justice
15.3 Global Governance: From Pax Britannica to Bretton Woods
15.4 Pax Americana (1945-?)
15.5 The Global Institutions of Pax Americana
15.6 The Bank for International Settlements (BIS) and the Global Banking Capitalisation Rules
15.7 The BRICS and the Evolution of Global Governance
15.8 Time for a New Bretton Woods?
15.9 Elements of a New Global Order
15.10 The European Union and Economic and Political Integration
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
16. Trade, Exchange Rates and the Balance of Payments
16.1 Why Trade?
16.2 Exchange Rates: Definition and Global Importance
16.3 Balance of Payments and the Balance of Trade
16.4 The Link Between Monetarism and Exchange Rates
16.5 Milton Friedman and the Case for Flexible Exchange Rates
16.6 Technique 13: Calculating the Terms of Trade
16.7 The Theory of Comparative Advantage
16.8 Making Poverty History
16.9 From Unfair Trade to Local Self-reliance
16.10 What is the Most Appropriate Organisational Form to Engage in Trade?
Thinking Questions
Class Activities
Areas for Research
UN SDG Focus
Further Reading
17. Contemporary Global Economic and Financial Trends
17.1 The Significance of Global Imbalances
17.2 Global Imbalances and Developing Countries
17.3 Global Imbalances: US-C