2013년 11월 30일 토요일

Dic: more like, more like it


  • The builders say they'll be finished in three months, but I think it'll be more like six.
  • Profits look more like 39 percent than the 61 percent reported for 1996.
  • He believes the figure should be more like $10 million.
△more like: used when giving amount or number that you think is closer to being right than one that has been mentioned.

△more like: used for giving a number or amount that you think is more accurate than another one.

△more like: used to give a number or an amount that is more accurate than one previously mentioned.

  • That gives us a total of 52ㅡthat's more like it.
  • She sat down by the pool and took a sip of her wine. 'This is more like it,' she said.
  • 'Poor David,' she said. 'Poor Harriet, more like it!'
  • That's more like it! You're really starting to improve.
  • This is more like it! Real food—not that canned muck.
  • Just talking? Arguing more like it.
△That's more like it (This is more like it): SPOKEN. used to say that something is better, more correct, or more enjoyable than something else.

△more like it: BrE SPOKEN. used when you want to change something that has been said, to make it more true.

△that's more like it: SPOKEN. used for saying that something is more satisfactory than before:

△more like (it): INFORMAL. (1) better; more acceptable. (2) used to give what you think is a better description of something

.... LDOCE, Macmillan, OALD

2013년 11월 25일 월요일

[발췌: G.R. Steele's review of] Keynes Hayek: The Clash That Defined Modern Economics

자료: Book reviews, Economic Affairs, Vol. 32 (3), 18 Oct 2012 (Wiley Online Library) [PDF ; HTML]

by G. R. Steele, Reader in Economics, Lancaster University Management School,

※ 발췌 (excerpt):

( ... ... ) The author's adjudication of the clash between Keynes and Hayek is far from impartial. Readers are led from the outset. Keynes had ‘a commonsense understanding’, whereas Hayek's was ‘intellectual rather than practical’. Keynes saw economics as ‘a means of improving the lives of others’, whereas Hayek was ‘consumed by economic theory for its own sake’. Keynes confronted ‘real-life dilemmas’, whereas Hayek indulged in ‘pure theory’. To a degree, this is as understandable as it is common. Few master either the depth of Hayek's work or the contrast between Keynes's General Theory and Keynesianism. Yet each is essential to any worthwhile appraisal of ‘the clash that defined modern economics’.

  The significance of eight weeks in Zurich (1919–1920) to Hayek's Sensory Order and the relevance of that paradigm to Hayek's analysis of a complex socio-economic order are missed. Instead, the trite categorisation of ‘devotees of the free market’ is reflected in multiple entries for ‘laissez-faire’, none of which cites Hayek on the emptiness of the term: nothing has done so much harm to the liberal cause as the wooden insistence of some liberals on … the principle of laissez-faire. Indeed, the ‘laissez-faire’ blunderbuss conflates policy directed towards managing real macroeconomic forces (abhorrent to Hayek) with policy to achieve monetary stability (which took Hayek's attention over many years).

The representation of tortoise (Hayek) and hare (Keynes) sits awkwardly with the suggestion that, by 1929, ‘both men were well advanced toward honing their competing views’. As the hare's General Theory (1936) displaced his two-volume Treatise (1930), the tortoise was leaving only cryptic clues (in 1931, 1933, 1935, 1939 and 1941), none of which would support the illustration that investment projects are abandoned because there is no demand ‘for ice cream’ by the time ‘ice trays for commercial refrigerators’ are complete. The exact opposite holds: by Hayek's business cycle theory, ‘higher order’ capital projects are halted because the demand for final goods becomes too urgent. That said, a chapter which details Hayek's four LSE lectures is lively and informative; but the suggestion that these arguments ‘would indirectly provide the foundation for the monetarist counter-revolution’ is far-fetched.

( ... )

[메모] “All that is gold does not glitter”

자료 1: http://en.wikipedia.org/wiki/All_that_is_gold_does_not_glitter

※ 발췌(excerpt):

All that is gold does not glitter,
Not all those who wander are lost;
The old that is strong does not wither,
Deep roots are not reached by the frost.

From the ashes a fire shall be woken,
A light from the shadow shall spring;
Renewed shall be blade that was broken,
The crownless again shall be king.

─ J. R. R. Tolkien, The Lord of the Rings, Vol.1: The Fellowship of the Ring

( ... ... ) The way appearance displays reality in our world is largely inverted in Middle-earth with respect to the subject matter of the poem. The first line is a variant and rearrangement of the proverb "All that glitters is not gold", known primarily from Shakespeare's The Merchant of Venice; resulting in a proposition bearing a completely different meaning: Aragorn is vastly more important than he looks.

The second line emphasises the importance of the Rangers, suspiciously viewed as wanderers or vagabonds by those the Rangers actually protect from evil. Lines three and four emphasise the endurance of Aragorn's royal lineage, while five and six emphasizes its renewal. They can also can be seen to represent a spark of hope during a time of despair and danger. Line seven refers to the sword Narsil. Line eight predicts Aragorn's rise to be king of kingless Gondor and vanished Arnor.[original research?]  ( ... )

자료 2: TOLKIEN GATEWAY: Rangers of the North

※ 발췌 (excerpt):

This article is about Dúnedain Rangers of Eriador. For the Gondorian Rangers, see Rangers of Ithilien.

Rangers of the North, or simply the Rangers, were the northern wandering people of Eriador, the last remnant of the Dúnedain of Arnor who had once peopled the North-kingdom of Arnor. They protected the lands they wandered although their secretiveness made other peoples consider them dangerous and distrustful in Bree and the Shire, where they were known as "Watchers".

They were grim in appearance and were usually dressed in grey or dark green, with a cloak-clasp shaped like an 6-pointed star.

The term 'Rangers of the North' was used most often by those who lived in the southern lands of Rohan and Gondor, perhaps to distinguish this people from their distant cousins, the Rangers of Ithilien. Like the Rangers of the North, these were also Dúnedain, but they belonged to the South-kingdom of Gondor, and their ancestors had been divided from the Northern Dúnedain for some three thousand years.


The Dúnedain of Arnor dwindled after the breaking of Arnor into three kingdoms and the wars with AngmarCardolan and Rhudaur soon fell and only the petty-kingdom of Arthedain maintained the noble line of Isildur. Finally, that too was destroyed in the Battle of Fornost and Arvedui, the last King of Arthedain was lost in the sea.

Arvedui's son and heir, Aranarth claimed the title of the Chieftain, who would rule the remnants of his people. Elrond had in his keeping the heirlooms of the house of Isildur: the shards of Narsil, the Star of Elendil, the Sceptre of Annúminas and later the Ring of Barahir, ransomed from the Lossoth.

Each of Aranarth's heirs (who, like him, could trace his descent back to Isildur himself) would be secretly born and raised in Rivendell.

The Rangers became a secretive wandering and nomadic people around Eriador, far from Sauron's spies, little known or remembered, and their deeds were seldom recorded.


The Watchful Peace followed the loss of Arnor and after its end, the enemies concentrated mostly against Rhovanion and Gondor. During that time, the Rangers fought minor battles and skirmishes against orcs and wolves in order to keep the region safe. The hobbits of the Shire flourished under their protection.

During the rule of Arassuil, the Orcs of the Misty Mountains became more bold, daring to invade Eriador. The Rangers fought many battles trying to hold them back, but one party managed to reach the Shire, and were fought off by a party of brave Hobbits under Bandobras Took in T.A. 2747. Soon after, the Long Winter arrived and many lives were lost, and Gandalf and the Rangers had to help the Hobbits of the Shire survive.

In 2911, during Argonui's rule, the Fell Winter began with the Brandywine freezing over. This was a catalyst for White Wolves invading Eriador from the North which must have harassed the Rangers. In the last year of his reign, great floods devastated Enedwaith and Minhiriath leaving Tharbad ruined and deserted. The following years were peaceful although Arador was killed by hill-trolls and his son Arathorn II was killed while hunting orcs.

Arathorn's son, Aragorn II succeeded him, who between 2957 to 2980 took great journeys, serving in the armies of King Thengel of Rohan, and Steward Ecthelion II of Gondor. Many of his tasks weakened Sauron and his allies, and the West endured him during the War of the Ring.

At that time Aragorn's Rangers were scattered and diminished. When Halbarad led a troop of the Rangers into the south to Aragorn's aid in the War, in haste he could muster no more than thirty in this company who fought in the Battle of Pelennor Fields.

Aragorn eventually became King Elessar of the Reunited Kingdom and the Rangers became once more a united people under the line of Elendil in the Fourth Age.

( ... ... )

[Godley & Lavoie's Monetary Economics] 2. Balance Sheets, Transaction Matrices and the Monetary Circuit

출처: Wynne Godley and Marc Lavoie, Monetary Economics: An Integrated Approach to Credit, Money, Income, Production and Wealth (Palgrave Macmillan, 2007)

※ 발췌 (reading notes with excerpts):

* * *

Chapter 2. Balance Sheets, Transaction Matrices and the Monetary Circuit 

2.1 Coherent stock-flow accounting

Contemporary mainstream macroeconomics, as it can be ascertained from intermediate textbooks, is based on the system of national accounts that was put in place by the United Nations in 1953ㅡthe so-called Stone accounts.  At that time, some macroeconomists were already searching for some alternative accounting foundations for macroeconomics.  In the United States, Morris A. Copeland (1949), an institutionalist in the quantitative Mitchell tradition of the NBER, designed the first version of what became the flow-of-funds accounts now provided by the Federal Reserve since 1952ㅡthe Z.1 accounts.  Copeland wanted to have a framework that would allow him to answer simple but important questions such as:
  • When total purchases of our national product increase, where does the money come from to finance them? 
  • When purchases of our national product decline, what becomes of the money that is not spent?' (Copeland 1949 (1996: 7)).
   In a macroeconomic textbook that was well-known in France, Jean Denizet (1969) also complained about the fact that standard macroeconomic accounting, designed upon Richard Stone's social accounting, as eventually laid out in the 1953 United Nations System of National Accounts, left monetary and financial phenomena in the dark, in contrast to the approach that was advocated from the very beginning by some accountants (among which Denizet) in the Netherlands and in France.
  • In the initial standard national accountingㅡas was shown in its most elementary form with the help of Table 1.1ㅡlittle room was left for banks and financial intermediaries and[,] the accounts were closed on the basis of the famous Keynesian equality, that saving must equal investment. 
  • This initial system of accounts is a system that presents the sector surpluses that ultimately finance real investment, but it does not present any information about the flows in financial assets and liabilities by which the saving moves through the financial system into investment.  These flows in effect have been consolidated out (Dawson 1991 (1996: 315)).  
In standard national accounting, as represented by the National Income and Product Accounts (NIPA), there is no room to discuss the questions that Copeland was keen to tackle, such as the changes in financial stocks of assets and of debts, and their relations with the transactions occurring in the current or the capital accounts of the various agents of the economy.  In addition, in the standard macroeconomics textbook, households and firms are often amalgamated within a single private sector, and hence, since financial assets or debts are netted out, it is rather difficult to introduce discussions about such financial issues, except for public debts.

   The lack of integration between the flows of the real economy and its financial side greatly annoyed a few economists, such as Denizet and Copeland.  For Denizet, J.M. Keynes's major contribution was his questioning of the classical dichotomy between the real and the monetary sides of the economy.  The post-Keynesian approach, which prolongs Keynes's contribution on this, underlines the need for integration between financial and income accounting, and thus constitutes a radical departure from the mainstream.[n.1]  Denizet found paradoxical that standard national accounting, as was initially developed by Richard Stone, reproduced the very dichotomy that Keynes had himself attempted to destroy.  This was surprising because Stone was a good friend of Keynes, having provided him with the national accounts data that Keynes needed to make his forecasts and recommendations to the British Treasury during the Second World War, but of course it reflected the initial difficulties in gathering enough good financial data, as Stone himself later got involve in setting up a proper framework for financial flows and balance sheet data (Stone 1966).[n.2]
[n.1] Such an integration of financial transactions with real transactions, within an appropriate set of sectors, was also advocated by Gurley and Shaw (1960: ch. 2) in their well-known book, as it was by a number of other authors, inspired by the work of Copeland, Alan Roe (1973) for instance, whose articles was appropriately titled 'the case for flow of funds and national balance sheet accounts'.
[n.2] Various important surveys of flow-of-funds analysis and a stock-flow-consistent approach to macroeconomics can be found, among others in Bain (1973), Davis (1987), Patterson and Stephenson (1988), Dawson (1996).
   By 1968 a new System of National Accounts (SNA) was published by the national accountants of the UN.  This new system provided a theoretical scheme that stressed the integration of the national income accounts with financial transactions, capital stocks and balance sheets (as well as input-output accounts), hence answered the concerns of economists such as Copeland and Denizet.  The new accounting system was cast in the form of a matrix, which started with opening assets, adding or subtracting production, consumption, accumulation and taking into account reevaluations, to obtain, at the bottom of the matrix, closing assets.  This new integrated accounting system has been confirmed with the revised 1993 SNA.

   Several countries now have complete flow-of-funds accounts or financial flows accounts, as well as national sheet accounts, so that by combining the flow-of-funds accounts and the national income and product account, and making a few adjustments, linked in particular to consumer durable good, it is possible to devise a matrix that accomplishes such an integration, as has been demonstrated by Backus et al. (1980: 270-1).  The problem now is not so much the lack of appropriate data, as shown by Ruggles (1987), but rather the unwillingness of most mainstream macroeconomists to incorporate these financial flows and capital stocks into their models, obsessed as they are with the representative optimizing microeconomic agent.  The construction of this integrated matrix, which we shall call the transaction flow matrix, will be explained in a later section.  But before we do so, let us examine a simpler financial matrix, one that is better known, the balance sheet matrix or the stock matrix.
cf. Backus, D., W.C. Brainard, G. Smith and J. Tobin (1980) ‘A model of U.S. financial and nonfinancial economic behavior’, Journal of Money, Credit, and Banking, 12 (2) (May),
pp. 259–93.

2.2 Balance sheets or stock matrix  (p. 25; 70)

( ... ... )

2013년 11월 24일 일요일

[Célia Firmin's review of] Monetary Economics: An Integrated Approach to Credit, Money, Income, Production,and Wealth

※ 발췌(excerpt): 

The work of Wynne Godley and Marc Lavoie offers a novel approach, based on a consistent accounting methodology relating stocks and flows, and making use of Post-Keynesian behavioural assumptions that tie the analysis to a monetary economics perspective. The authors’ objective is to provide an analytical framework that could provide an alternative to the standard approach, by taking into account comprehensively the interrelations between real and financial variables.

( ... ... )

The first two chapters outline the methodology and present the accounting matrices constituting the backbone of “stock-flow consistent” models. Applying this methodology to the monetary circuit helps to show that money cannot but be endogenous, a claim that constitutes a major breakpoint between standard analysis and Post-Keynesian analysis.

The model proposed in the third chapter outlines the principles of the Keynesian multiplier. An important conclusion follows from this chapter: the public deficit and the public debt are endogenous variables that are not really under the realm of government, as they depend ultimately on the saving decisions of the private sector. The fourth chapter develops a model of portfolio choice. Holdings of money balances depend on the standard Keynesian motives (transaction, precaution, and speculation), while arbitrage between assets is based on rates of return, income, wealth, and liquidity preference. The money supply is endogenous by nature—it is driven by demand—while interest rates are exogenous variables.

Subsequent chapters include new material or specify some key points (the preference for liquidity, the role of time, the decomposition of profits, cost-plus or markup pricing procedures, the open economy...). Chapter 11 provides a growth model in which fiscal policy and monetary policy are introduced.

One of the main results of this work concerns precisely the effectiveness of fiscal policy in an economy where financial variables play an important role. ( ... ) Moreover, the government deficit is predetermined by the level of saving of private agents, firms, and households. The state cannot seek a balanced budget without giving up the fight against unemployment, which calls into question the criteria of the European stability pact.

Moreover, another interesting result coming out from the simulations is the inability of household debt to drive growth in the long run. Instead, the servicing cost of household debt eventually reduces consumption. The amounts previously borrowed by households lead to a decline in consumer demand, thus disabling the growth regime driven by household debt.

The models presented here therefore provide an explanation of the current economic crisis— an explanation that goes beyond the role of financial variables, linking these to “real” and structural causes, and showing that recovery cannot be envisaged without a proactive fiscal policy.

A critical analysis of the SFC methodology

Rather than quantifying the effects obtained, this method tends to give a qualitative narrative vision of the observed sequences of events, which may be a limit to the analysis. Moreover, the complexity of the models sometimes leads to difficulties in interpreting the results; in particular, in understanding the causality between variables. Such a method only allows the analysis of a local equilibrium, casting doubt on its uniqueness and leaving open the possibility of other regimes linked to different parameter values. It is possible to solve this problem by trial and error, by testing for different parameter values in an attempt to determine the properties of other steady states of the model. Thus, the stability conditions are not rigorously defined. It is not possible to ensure that all configurations of the model, all regimes, have been found and analyzed. For example, in the model in Chapter 11, a higher rate of interest produces a paradoxical effect, bringing about a positive impact on output and employment in the long run. Interest payments are treated like a public expenditure, generating a positive multiplier effect, despite the negative short-run impact on business investment. Is this result robust to changes in the parameter values? Is it possible to identify a regimfiae where the negative effect on investment outweighs the long-run positive effect on aggregate demand arising from the higher cost of servicing the public debt? Doubts about the possible existence of other regimes based on different parameter values are certainly the main limitation of model resolution by numerical simulation.

Moreover, were there several regimes, it would be difficult to find the precise conditions of transition from one regime to another. Finally, it is not possible to integrate several shocks within a single simulation, because it would then be impossible to know what comes from one shock rather than from another. Effects that contradict one another would also be hard to identify in this type of analysis.

( ... ) Within this framework—and this is one of the main results—the money supply can only be endogenous, it comes from the financing needs of the economy (investment, consumption, etc.), the real and financial variables are fully embedded, there are several assets and rates of return, and financial and monetary policy operations are fully modelled. All this provides an analytical key that is highly useful for our understanding of the functioning of contemporary economies. The integrated inclusion of financial and monetary variables does not change the usual Keynesian claims with regard to the major role played by fiscal policy in reducing unemployment and boosting economic growth. These conclusions, submitted before the eruption of the current global crisis, should be brought back to center stage, and they clearly show, if it ever was in need of being demonstrated, the analytical relevance of Post-Keynesian models.

[메모] iconography

1. Wikipedia: iconography (as of Nov. 24, 2013)

Iconography is the branch of art history which studies the identification, description, and the interpretation of the content of images: the subjects depicted, the particular compositions and details used to do so, and other elements that are distinct from artistic style. The word iconography comes from the Greek εἰκών ("image") and γράφειν ("to write").
A secondary meaning (based on a non-standard translation of the Greek and Russian equivalent terms) is the production of religious images, called icons, in the Byzantine and Orthodox Christian tradition; that is covered at Icon.
In art history, "an iconography" may also mean a particular depiction of a subject in terms of the content of the image, such as the number of figures used, their placing and gestures. ( ... ... )
1-1. 위키백과: 아이코노그래피 (2013년 11월 24일 발췌)
아이코노그래피(Iconography)[1] 또는 도상학(圖像學)[2]아이콘, 즉 도상(圖像)의 내용들을 판정하고 서술하고 해석하는 것을 연구 과제로 하는 미술사(art history)의 한 분과이다. 따라서 아이코노그래피에서는 아이콘에 묘사되어 있는 주제들, 즉 화제(畵題)들과, 그 화제들을 나타내기 위해 사용된 개별 구성 요소들과 세부 사항들, 그리고 유파별 미술 양식(artistic style)과는 구별되는 다른 요소들을 판정하고 서술하고 해석한다.
"아이코노그래피(iconography)"라는 낱말은 고대 그리스어의 에이콘(εἰκών, eikon)과 그라페인(γράφειν, graphein)에서 유래한 것으로, 에이콘은 영어의 이미지(image)에 해당하며 그림, 이미지 또는 상(像) 등의 도상(圖像), 즉 아이콘(icon)을 뜻하고,[3]그라페인은 쓰다(write)의 뜻이다. 이러한 1차적인 의미에서 파생된 2차적인 의미로서, 고대 그리스어의 에이콘(εἰκών), 즉 영어아이콘(icon)은 성화상(聖畵像)을 뜻하는데 특히 비잔틴 미술동방 정교회 전통의 성화상을 뜻한다. ( ... ... )

2. 중세 예술의 기하학
( ... ) 이처럼 시각적 아름다움이 아니라 형상을 통해 어떤 말씀 즉 메시지를 전달하는 예술을 이코노그래피(iconography)라 한다. 이코노 즉 아이콘이란 의미기호라는 뜻이며 그래피란 형상 아닌가? 즉 모든 형상이 어떤 의미내용을 담고 있다는 예술의 상징성을 드러낸 말이다.
이처럼 중세의 예술은 이코노그래피이지 단순히 시각적 아름다움을 보여주는 장식적 예술이 전혀 아닌 것이다. 이런 예술의 이상은 헬레니즘 시대의 이상과는 전적으로 다른 것이다. ( ... )
시각적 이미지로 구현된 다양한 신적 존재들을 판별하는 것은 불교미술 연구자들의 주된 관심사의 하나이다. 도상학(圖像學, iconography)이라 불리는 미술사 연구방법의 가장 초보적인 단계에 속하는 이 작업은 때로는 명쾌하나 때로는 그리 단순하지 않다.1) 시각적 이미지에 드러난 양상들에 일관성이 없거나, 그러한 양상이 문헌에 서술된 사항과 일치하지 않거나, 판별을 가능하게 할 만한 특징들이 충분히 제시되어 있지 않은 경우가 많기 때문이다. 그러한 어려움은 대상이 어떤 부류의 신적 존재인가에 따라서도 다르다. 하위의 신적 존재들은 독특한 형상을 갖춘 경우가 많아 일반적으로 판별이 쉽다. 보살의 경우도 특유한 형상이나 표지들에 근거하여 비교적 판별이 가능하나, 동시에 그것이 쉽지 않은 사례도 제법 존재한다. 이에 비해 붓다는 형상이 단조롭기 때문에 판별이 훨씬 어렵다. ( ... ... )
[주] 144. 신비적 경험의 재현은 17세기 봉헌 도상(devotional iconography)에서 반복된 주제였다. John Rupert Martin, op. cit., p. 100.

2013년 11월 23일 토요일

[메모] chapter 2 - gender codes (in Lize-Meri Smalberger's "Playing Sex ...")

출처: Lize-Meri Smalberger, Playing Sex: The exploration, creation and transmission of gender codes in puppetry through the practical exploration of ^Cleansed^, March 2011
자료: 인터넷링크

Chapter 2 - Gender Codes

Gender refers to the bodily structures and processes of human reproduction.  These structures and processes do not constitute a 'biological base', a natural mechanism that has social effects. Rather, they constitute an ^arena^, a bodily site where something social happens.  Among the things that happen is the creation of the cultural categories 'woman' and 'men' (and any other gender categories that a particular society marks out). (Connell 2002: 48)

From the above quotation we gather that R.W. Connell not only defines gender as the term used to distinguish between categories of male and female; it is the socially constructed ideology that places men and woman into different categories of sex based on their reproductive organs.  The debate around gender is precisely this; that the sex one is born with determines ones[one's] genderㅡmale or female.  According to the sex one is born with, one is then categorized into different social roles that define men and women.  Thus implying that one is not born a man/woman; one rather becomes a man/woman/  Judith Butler (1999: 112) argues that if we view gender as a sort of becoming or activity, then "gender ought not to be conceived as a noun or a substantial thing or a static cultural marker, but rather as an incessant and repeated action of some sort".

Butler (1993: 231) describes gender as a "practice".  This refers to the embodiment of certain norms and repeating it until it becomes an inherent and coherent truth.  Butler (1999: 140) states that gender is not a fact; it does not express or externalize an "essence" nor does it aspire to an "objective real".  Gender is constituted out of various acts that create the idea of gender and without these acts there will be no gender at all.

To Butler (1999: 33), gender is not something we are born with, nor is it something created by the mind or spirit.  She states that "gender is the repeated stylization of the body, a set of repeated acts".  These acts are performed over a period of time and ultimate produce the "appearance of substance, of a natural sort of being", thus making gender performative.  Performitivity comes from the term performance and in order to understand ad comprehend gender as a performative act, it is necessary that I give a definition of performance.

( ... ... )

These socially constructed norms are the gender codes through which gender is communicated.  We communicate our gender through signs/codes and these codes lie within the way we dress, act, speak and ultimately express ourselves:
Gender refers to the words, gestures, appearances, ideas and behavior that dominant culture understands as indices of feminine or masculine identity.  When spectators 'see' gender they are seeing (and reproducing) the cultural signs of gender, and by implication, the gender ideology of culture (Diamond in Counsell and Wolf 2001: 79)
Gender codes are thus mediums through which we communicate our gender and, as we have come to learn, these codes are socially constructed and are located on the surface of the body.  Because gender codes are not located within the "self", the possibility exist that these codes can be explored, created and transmitted through theatrical performances such as drags and even puppet theater.

( ... ... )

2013년 11월 22일 금요일

[책: B. Lietaer & S. Belgin's] New Money for a New World (2011)

출처: Bernard Lietaer and Stephen Belgin, New Money for a New World (Qiterra Press, December 2011)
자료: amazon; ...

주요 차례 (Main Contents):


PART I: Our Money, Our World

  • 1. A Tale of Two Cities
  • 2. Welcome to Moneyville
  • 3. Megatrends and Money
  • 4. A Money Primer
  • 5. Money Is Not Value Neutral
  • 6. Back to the Future
  • 7. A Change of View
  • 8. Economic Myopia
  • 9. Lessons from a Depression
  • 10. The Blind Spot
PART II: New Money
  • 11. Great Change
  • 12. Efficiency, Resilience, and Money
  • 13. Sustainable Development
  • 14. LETS and Time Dollars
  • 15. Social-Purpose Currencies
  • 16. Commercial-Purpose Currencies
  • 17. The Terra, A Trade Reference Currency
  • 18. Two Worlds
PART III: The Mistery of Money
  • 19. Archetypes
  • 20. The Missing Archetype and Money
  • 21. Repression of an Archetype
  • 22. Shadows
  • 23. Money and Tao
  • 24. Consequences of Repression
PART IV: Money, Archetypes ad Past Ages
  • 25. The Central Middle Ages Revisited
  • 26. Dynastic Egypt
  • 27. Dynastic Egypt Revisted
  • 28. The Balinese Exception
  • 29. Invitation To A New World
  • 30. The Dynamics of Transformation and Money

2013년 11월 20일 수요일

[책: G. Hallsmith & B. Lietaer's] Creating Wealth: Growing Local Economies with Local Currencies (2011)

출처: Gwendolyn Hallsmith and Bernard Lietaer. Creating Wealth: Growing Local Economies with Local Currencies (New Society Publishers, 2011)
자료: 구글도서 ;

※ 차례 (Contents):

Preface (Dennis Meadows)
Foreword (Hunter Lovins)

Introduction: Cities and Economies


  • 1. What Is Wealth  (3)
  • 2. Crash and Burn Economics  (15)
  • 3. Community Capitalism  (43)
  • 4. The Possibility of Sufficiency and Abundance  (55)
  • 5. Building Equity  (73)
  • 6. Growing Intelligence  (79)
  • 7. The Creative Economy  (91)
  • 8. Exchanging Ecologies  (101)
  • 9. Minding the Community's Business  (111)
  • 10. Putting the Care Back In Healthcare  (121)
  • 11. Honoring Our Elders, Caring For Children  (133)
  • 12. Eating Money  (143)
  • 13. Intentional Cities  (161)
  • 14. A Tale of Three Cities  (181)
Conclusion: Toward A Monetary Democracy  (207)

Appendix: The Community Currency How-To Manual  (217)
Endnotes  (239)
Resources  (243)

Index  (259)

[From PositiveMoney] Problem with Money System (2012)

출처(source): www.positivemoney.org.uk ; PositiveMoney(Youtube),
화자(main speaker): Ben Dyson

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2013년 11월 19일 화요일

[책: Lietaer & Dunne's] Rethinking Money: How New Currencies Turn Scarcity into Prosperity (2013)

지은이: Bernard Lietaer and Jacqui Dunne
출처: Rethinking Money: How New Currencies Turn Scarcity into Prosperity (Berret-Koehler, 2013)
자료: http://www.bkconnection.com/static/Rethinking_Money_EXCERPT.pdf

※ 차례 (Contents):

Foreword (by John Perkins)

Introduction: From Scarcity to Prosperity within a Generation  (1)

Part I:  Scarcity

  • 1. The Failure of Money: The Competitive Society  (11)
  • 2. The Myth of Money: What It Really Is  (23)
  • 3. A Fate Worse Than Debt: Interest's Hidden Consequences  (37)
Part II: Prosperity
  • 4. The Flying Fish: A New Perspective on Money  (57)
  • 5. The Future Has Arrived But Isn't Distributed Evenly ... Yet!  (73)
  • 6. Strategies for Banking  (95)
  • 7. Strategies for Business and Entrepreneurs  (119)
  • 8. Strategies for NGOs  (159)
Part III: Rethinking Money
  • 10. Truth and Consequences: Lessons Learned  (175)
  • 11. Governance and We, the Citizens: An Ancient Future?  (187) 
  • 12. Our Available Future: The Cooperative Society   (203)
  • 13. Rethinking Money: From Scarcity to Sustainable Abundance  (215)
Notes  (225)
Bibliography  (241)

2013년 11월 17일 일요일

[Godley & Lavoie's Monetary Economics] 1. Introduction

출처: Wynne Godley and Marc Lavoie, Monetary Economics: An Integrated Approach to Credit, Money, Income, Production and Wealth (Palgrave Macmillan, 2007)

※ 발췌 (reading notes with excerpts):

* * * 


I have found out what economics is; it is the science of confusing 
stocks and flows.

A verbal statement by Michal Kalecki, circa 1936, 
as cited by  Joan Robinson, in  'Shedding darkness', 
Cambridge Journal of  Economics, 6(3), September 1982, 295-6.

1.1 Two paradigms

During the 60-odd years since the death of Keynes there have existed two, fundamentally different, paradigms for macroeconomic research, each with its own fundamentally different interpretation of Keynes's work. [n.1]  On the one hand there is the mainstream, or neo-classical, paradigm, which is based on the premise that economic activity is exclusively motivated by the aspirations of individual agents.  At its heart this paradigm requires a neo-classical production function, which postulates that output is the result of combining labour with capital in such a way that, provided all markets clear, there will be no involuntary unemployment while the national income is distributed optimally and automatically between wages and profits.  If markets do not clear because wages or prices are 'sticky', the same structure will generate determinate, if sub-optimal, disequilibrium outcomes and, for many economists, it is the possibility of such stickiness that defines Keynesian economics.  The key assumption that individual welfare maximization is the universal mainspring is not consistent with the view that firms have an independent existence with distinct motivations, because optimum prices, output and employment are all decided for them by the location of aggregate demand and supply schedules. And as production is instantaneous, while supply is brought into equivalence with demand through the market-clearing process, there is no systematic need and therefore no essential place for loans, credit money or banks.  The concept of 'money' is indispensable, yet money is an asset to which there is not, in general, a counterpart liability and which often has no accounting relationship to other variables.  Mainstream macroeconomic theory is a deductive system which needs no recourse to facts (though it may be 'calibrated' with numbers) and lends itself to analytic solutions.
[n.1] For a masterly survey of the entire field see Lance Taylor (2004b), Reconstructing Macroeconomics: Structuralist Proposals and Critiques of the Mainstream (Cambridge, MA: Harvard University Press).  
   The alternative paradigm, which has come to be called 'post-Keynesian' or 'structuralist', derives originally from those economists who were more or less closely associated personally with Keynes such as Joan Robinson, Richard Kahn, Nicholas Kaldor, and James Meade, as well as Michal Kalecki who derived most of his ideas independently.  So, far from being a deductive system, the post-Keynesian vision is underpinned by 'stylised facts' recognizing the manifest existence of institutions, together with regularities and magnitudes in the economic data which can be checked out empirically.  Central to this system of ideas is that, in a modern industrial economy, firms have a separate existence with a distinct set of objectives, for example, to make enough profits to pay for growth-maximizing investment.  Rejecting as chimerical the concept of the neo-classical production function,[n.2] post-Keynesians hold that, in an uncertain world, firms, operating under conditions of imperfect competition and increasing returns, must decide how much to produce and how many workers to employ, what prices to charge, how much to invest, and how to obtain finance.  It will be the pricing decision which, in general, determines the distribution of the national income between wages and profits.  And as production and investment take time while expectations are in general falsified, there is a systematic need for loans from outside the production sector which generates acceptable credit money endogenouslyㅡin other words (in accordance with common observation) there must exist a banking sector.  According to post-Keynesian ideas, there is no natural tendency for economies to generate full employment, and for this and other reasons growth and stability require the active participation of governments in the form of fiscal, monetary and incomes policy.  And it will probably impossible to derive analytic solutions which describe how economies as a whole evolve, particularly as institutions and behavioural patterns change drastically through historical time.
[n.2]  Appendix 1.1 provides compelling reasons for this rejection.
   Luigi Pasinett (2005) laments the fact that post-Keynesians have progressively failed to establish 'a permanent winning paradigm'.  And indeed, while pockets of stubborn resistance remain, the post-Keynesian tradition has now been virtually written out of the literature; it has lost out to the mainstream in terms of how the subject is taught, what the 'top' learned journals will accept, where research money is allocate, how appointments are made and how empirical models are built.  Pasinetti attributes this collapse in large part to the personal characters of the formidable economists who directly succeeded Keynes, maintaining (correctly in our opinion), that they did not admit outsiders to their circle or sponsor their work.  But Pasinetti also points to 'a lack of theoretical cohesion in the various pieces which emerged from the Keynesian School', which 'paid scant attention to the fundamentals on which an alternative, but coherent, paradigm could be built'.  He suggests that 'a satisfactory blueprint that could house, beneath one single roof, the development of the existing ideas along the Keynesian lines ... is still lacking' ... and that there is a need for 'an account of what happensㅡas Keynes put itㅡin a "monetary production economy", which is more complex than a pure exchange stationary economy, because it is intrinsically dynamic, continually affected by history subject to changes both in scale and structure'.  This is an admission that post-Keynesian economics up to the present time simply does not cover the ground.

   Geoffrery Harcourt (2001: 277) in similar vein observes that post-Keynesians have been following the Marshallian/Keynesian method which 'consists at looking at parts of the economy in sequence, holding constant or abstracting from what is going on, or at least the ^effects^ of what is going on elsewhere, for the moment', in the hope that it would be possible eventually 'to bring all our results together to give a full, overall picture'.  Harcourt thinks that 'this may be one of the reasons why ultimately both Marshall and Joan Robinson thought that they had failedㅡnot from realizing that by following the procedure they were attempting the impossible, but because the ^procedure^ itself was at fault'.  While neo-classical economists have general equilibrium theory and computable general equilibrium models that helped capture the overall implications of their vision and the interdependence between markets and sectors, post-Keynesian economics could only offer the Sraffian model as a formal tool to tackle production interdependencies and relative prices, but which, ironically, did not and could not deal with the crucial Keynesian issues of output, unemployment, inflation, financial flows and pieces, with no account of how the system as a whole worked.  There is no statement which characterizes how post-Keynesian theory can underlie the way in which an industrial capitalist economy works ^as an organic while^.  Despite valiant efforts, such as the book by Eichner (1987), there is no post-Keynesian textbook which covers all of the monetary macro ground as a coherent whole.[n.3]
[n.3]  This was already pointed out in Godley (1993: 63), where the author deplored the absence of a Kaldorian textbook, stating that 'Kaldorian ideas in their positive mode have not been put together in a way which covers the syllabus'.  In a footnote to this, the author added that an exception to this generalization was the 1987 (unfortunately unfinished) Eichner book (Godley 1993: 80)
cf. Eichner, A.S. (1987) The Macrodynamics of Advanced Market Economics (Armonk, NY: M.E. Sharpe)

1.2 Aspiration

In writing this book it has been our aspiration to lay the foundations for a methodology which will make it possible to start exploring rigorously how real economic systems, replete with realistic institutions, function as a whole.  Our starting point, though a little intricate for an introduction, is yet so simple that we propose to plunge straightaway ^in medias res^[Latin for 'into the middle of things].

   The standard textbook introduces macroeconomic concepts via the national income identity.  Thus total production, or gross domestic product (GDP), is defined as the sum of all expenditures on goods and services or, alternatively, as the sum of all incomes paid for production of goods and services.  More precisely, the GDP (assuming the economy to be closed) is made up of personal consumption, investment and government expenditure on goods and services; looked at from the income side, it is made up of income from employment and profits.  All these concepts are introduced as 'real' variables, the GDP being an economy's total volume of production.  Writing these identities formally we have:

CIGYWBF   (1.1)

where C is consumption, I is investment, G is government expenditure, Y is GDP, WB is the wage bill and F is profits.

   And that is about it, so far as accounting goes, though when it comes to studying the consumption function the student will quickly have to learn that personal disposable income is give by:

YDYT   (1.2)

where YD is personal disposable income and T describes all taxes and transfers received or paid by the government.  Equation (1.2) builds in the implicit (but counterfactual) assumption that all profits are instantaneously distributed to households.

   Decomposing the wage bill into a quantity of employment times a wage rate and postulating the existence of a rate of interest, a stock of money, a price of real output and a stock of fixed capital equipment, we have enough concepts to erect the 'core' model of the so-called neo-classical synthesis, which constituted mainstream macroeconomics at least until the 1980s and from which more recent schools of thought (e.g. Rational Expectations, Real Business Cycles, New Keynesian) are directly descended.  By this model, in its basic manifestation, the demand for output is determined by consumption and investment functions, the profit-maximizing supply of output is determined by the marginal product of labour and the real wage.  The demand for real money balances is determined by income and the rate of interest, while the supply of money is exogenous and given.  The entire system is in market-clearing equilibrium when all three demands are in equivalence with all three supplies, yielding determinate values for all the components of the national income as well as for employment and for each 'price'.

   Although every author will have his or her own gloss on how exactly this model works, and what happens if in various ways it doesn't work, we have no doubt whatever that this account does fairly summarize the core model which dominated the scene for so long. [n.5]  The purpose of reproducing it here is not to criticize it, but rather to set up a clear reference point in terms of which we can clearly deploy a radically different way of viewing the world and setting up a research agenda to explore it.
[n.5] The classic expositions are to be found in Patinkin (1965) and Modigliani (1944, 1963).  The basic model is not changed when markets fail to clear.  It is, for instance, commonly argued that 'Keynesian economics'ㅡusing this modelㅡis encapsulated by assuming that the nominal wage is exogenously determined, in which case the supply of labour can exceed the demand, causing, and suggesting the cure for, unemploymentㅡin advance of any empirical investigation whatever.
   The difference between the world to be deployed in the following chapters and that introduced in most textbooks is well introduced by first fitting the variables described in equation (1.1) into a matrix such as that shown in Table 1.1, which brings out the fact that each variable is a transaction between two sectors which takes place in some given period of time.

   The second column of Table 1.1 does nothing more than reproduce equation (1.1) in a vertical arrangement.  The other columns show the transactions implied by the component parts of equations (1.1) and (1.2).  Thus, for instance, consumption is a receipt by the business sector and a payment by the household sector.  The only thing which might be unfamiliar to a student is the third column, which describes the capital account of the business sector.  But there should be no difficulty about the meaning and significance of this; sales of investment goods give rise to receipts by the business sector like any other sales.  But these receipts will have to come (at this level of abstraction) from payments by the business sector itself, which is assumed to do all the investing.

   But now it is easy to see that this system of concepts is seriously incomplete.  Consideration of the matrix immediately poses the following questions.  What form does personal saving take?  Where does any excess of sectoral income over expenditure actually go toㅡfor it must go somewhere?  Which sector provides the counterparty to every transaction in assets?  Where does the finance for investment come from?  And how are budget deficits financed?

   There is an obvious answer to these questions, which follows from an elementary knowledge of the way the real world works and which can be quickly verified by inspecting the Flow-of-Funds tables published by the Federal Reserve in the United States, which provide data relating to every quarter since 1952.

   Table 1.2 completes and rectifies the story adumbrated in Table 1.1, showing a relatively simple comprehensive system of accounts which describes all the intersectoral transactions implied by the Table 1.1 concepts but not shown there.

   The upper, national income, part of the table reproduces Table 1.1, with the important difference that the usual assumption that all profits are distributed has been dropped.  Instead some proportion of profits is transferred to firms' capital account, where it may be used to finance investment. [n.6]  The lower, flow of funds, part of the table could have been completed in various different ways depending on the degree of detail and the simplifications deemed appropriate. However, it will be a cardinal principle applying here and to every array of concepts we shall deploy in the future that all rows and all columns sum to zero, [n.7] thus ensuing, in the catch-phrase, that 'everything comes from somewhere and everything goes somewhere'.
[n.6] Table 1.2, although an improvement over Table 1.1, still omits several relevant features, such as interest payments, and it assumes that the central bank is amalgamated with the government.  A more complete matrix will be introduced in Chapter 2.
[n.7] For this reason the closed economy described above could not be 'opened' by adding a column describing exports and imports since this will not normally sum to zero.  The solution will be to include all trading partners in the matrix, as will be shown in Chapter 6 and 12, making a larger closed system in which there is no place for a balance of payments column.
   However, no sooner does one contemplate filling in the assets which are acquired by households than a second important inadequacy of Table 1.1 immediately becomes manifest.  Households may (for instance) acquire credit money as an asset, but where is the counterpart acquisition of liabilities to be found? And firms may require loans to finance investment in excess of retained profits, but from where are these to come?  The answers are obvious as soon as the questions are asked.  The matrix cannot be completed unless a whole new sectorㅡa banking sectorㅡis introduced into the elementary system of concepts.
  • In column 1 the saving of the personal sector is assumed to go entirely into cash[-ΔHh], credit money[-ΔM], government securities[-ΔBh], and newly issued equities[-Δe·Pe].
  • There are no entries in column 2 because profits are defined as the residual between current inflows and outflows.
  • In line 5 profit are in part distributed[-FDf] and in partㅡin practice by far the greater partㅡundistributed[-FUf].
  • In column 3 the funds in excess of retained profits required for investment are assumed to come in part from the issue of equities[+Δe·Pe], with the balance coming from loans[+ΔLf]
  • In column 5 the government is assumed to finance any deficit by the issue of securities[+ΔB] and cash[-ΔH].
  • Finally in column 4 we have the banks' transactions in assets which comprise the genesis of loans and credit money and which bring these concepts firmly into the most basic accounting structure, and they also say, non-trivially, that any gap between these two supplies[? loans and credit money] must always be matched exactly by net accumulation by banks of cash[? -ΔHb] and government bills[? -ΔBb]ㅡfor the balance of banks' transactions in assets must sum to zero if only because every other row and column in the table sums to zero.
   All entries in the flow-of-funds sections of Table 1.2 describe changes in stock variables between the beginning and end of the period being described. [n.8]  Thus the evolution of historic time is introduced into the basic system of concepts.  The transactions in asset stocks in Table 1.2 imply the existence of an interlocking system of balance sheets, described in Table 1.3.  These balance sheets measure the levels of all stock variables at some given point of time.  And it is the configuration of stock variables which is providing the link between each period of time and that which follows it.
[n.8] The variables are defined in the matrix. The term e in the final line describes the number of equity titles and Pe describes their price.

   The evolution of the entire system may be characterized (at the level of accounting) by saying that at the beginning of each period, the configuration of stock variables (i.e. all physical stocks together with the interlocking system of financial assets and liabilities) is a summary description of (relevant[n.9]) past history.  Then the transactions described in Table 1.2 heave the stock variables from their state at the beginning of each period to their state at the end,[n.10] to which capital gains will have to be added.

   For this system of accounting identities to hold, all variables must be measured at current prices, since they describe the sums of money that actually change hands each periodㅡotherwise, unless there is no change in any price, the columns would not add up to zero. [n.11]  Yet a number of key decisions regarding, in particular, production, consumption, investment and many kinds of government expenditure are taken in terms of real, physical quantities.  So we shall at some stage have to describe, at the level of accounting (i.e. before considering behaviour)[,] how prices translate nominal into real variables, thereby determining the distribution of the national income.

1.3 Endeavour

We can now disclose in a nutshell the nature of the task we have set for ourselves.  We are going to define a series of evolutionary models, each of which describes an economy moving forward non-ergodically in historical time, as Paul Davidson (1988) would put it.  We start with truly primitive models containing a mere handful of equations and end up with relatively elaborate models containing one hundred or more equations.  Each model must account for every single one of the variables contained in the relevant transactions and balance sheet matrices.  So in sharp contrast with the Marshallian method, we shall always be exploring the properties of complete systems, never assuming that we can consider one topic at a time in the hope that the rest of the world stays in place while we do so.

   The method will be to write down systems of equations and accounting identities, attribute initial values to all stocks and all flows as well as to behavioural parameters, using stylized facts so well as we can to get appropriate ratios (e.g. for the proportion of the national income taken by government expenditure).  We then use numerical simulation to check the accounting and obtain a steady state for the economy in question.  Finally we shock the system with a variety of alternative assumptions about exogenous variables and parameters and explore the consequences.  It will be our contention that via the experience of simulating increasingly complex models it becomes possible to build knowledge, or 'informed intuition',[n.12] as to the way monetary economics must and do function.

   The use of logically complete accounts (with every row and every column in the transactions matrix summing to zero) has strong implications for the dynamics of the system as a whole.  This completeness carries the implications that once n-1 equations are satisfied then the nth equation will be found to be satisfied as well and for this reason must always be dropped from the computer model to avoid overdetermination.  If the accounting is less than complete in the sense we use, the system dynamics will be subvertedㅡrather as though we were trying to operate a hydraulic machine which had leaky pipes.

   ( ... ... )
   ( ... ... )
   ( ... ... )
   ( ... ... )
   ( ... ... )

1.4 Provenance

Over the past few years, centered along the axis of the New School University and the Levy Economics Institute, both located in New York State, there has been a revival of interest in the stock-flow consistent approach to macroeconomic modelling, or what we could call a sectoral monetary stock-flow consistent approach.[n.13]  The purpose of the present book is to feed this revival, in the hope that an accessible introduction to stock-flow consistent macro-economic modelling will induce more students and more colleagues to adopt and develop such an approach.  Our belief is that, if such an adoption occurs, macroeconomics in general and heterodox economics in particular should become sounder and more transparent.

   ( ... ) In broad terms, one can identify two schools of thought which actively developed a series of models based on the stock-flow consistent approach to macroeconomic modelling, one located at Yale University and led by the Nobel Prize winner James Tobin, and the other located at the Department of Applied Economics at Cambridge University and led by one of the present authors (Wynne Godley).  To a large extent, both groups worked independently, at least until a conference on Keynes that was organized in Cambridge (UK) in 1983.  The Yale group, also known as the 'pitfalls approach' or the New Haven school, focused its attention on portfolio and asset choice; its inspiration was essentially neo-classical and based on a practical variant of general equilibrium theory.  The Cambridge UK group, which was known as the Cambridge Economic Policy Group (CEPG) or the New Cambridge School, used the stock-flow consistent framework mainly for forecasting whether an expansion was ^sustainable^, as Godley (1999c) still does today, and to discuss the balance of payments problems that were then plaguing the United Kingdom.
cf. Godley (1999c) Seven Unsustainable Processes: Medium-Term Prospects and Policies for the United States and the World, Strategic Analysis, The Levy Economics Institute of Bard College.
   Both research groups faded in the middle of the 1980s, as their funding was cut off, ( ... )

   The more recent work of Godley (1996, 1997, 1999a), which has led to the creation of the present book, owes a substantial debt to Tobin, most particularly the work of Tobin as it appears in Backus, Brainard, Smith and Tobin (1980), which presented the most explicit and most empirically-oriented version of the research programme that was being pursued at Yale University on the stock-flow consistent approach to macroeconomic modelling.[n.15] ( ... )

1.5 Some links with the 'old' Yale school [n.17]

In his Nobel lecture, Tobin (1982a: 172-3) identified the main features that distinguished his work.  Four features stood out, and they certainly apply to the present book.
1. Tracking of stocks and precision regarding time;
2. Several assets and rates of return;
3. Modelling of financial and monetary policy operations;
4. The budget constraint and the adding-up constraint.

( ... ... )

   Feature (2) says that a comprehensive model should have several assets and several rates of return.  Tobin objected to the standard representation of the IS/LM model, which has only one explicit rate of return, the bill rate, and one explicit asset, money.  Since financial relations are so important in a modern economy, a sophisticated financial framework must be developed to understand the various interaction between borrowers and lenders, as well as the role of the banking system.  In our book we shall experiment with various numbers of assets, and various kinds of assets.  ( ... )

   Feature (3), the modelling of financial and monetary policy, will be a key part of our book.  How the stocks of the various assets are supplied, in particular by the monetary authorities and the government, will be described in detail.  ( ... ) Indeed, how the banking and financial systems are precisely being modelled constitutes one of the major differences between the Yale approach on the one hand and the New Cambridge approach which is being advocated here.

   Finally, there is feature (4), which says that agents must respect their budget constraint, both in regard to their expectations and when they assess realized results.  In the case of expected results, this is sometimes referred to as Walras' Law, as does Tobin in his Nobel lecture, but we would rather refer to a budget constraint or to a system-wide consistency requirement.  In a water-tight accounting framework, the transaction flows of the ultimate sector are entirely determined by the transaction flows of the other sectors.  Indeed, we shall see that this consistency requirement always implies a ^redundant^ equality.  Feature (4) means that there cannot be any ^black hole^.  In the words of Godley and Cripps (1983: 18), 'the fact that money stocks and flows must satisfy accounting identities in individual budgets and in an economy as a whole provides a fundamental law of macroeconomics analogous to the principle of conservation of energy in physics'.  While consistency is required at the accounting level, it is also required at the behavioural level.  This consistency requirement is particularly important and useful in the case of portfolio choice with several assets, where any change in the demand for an asset, for a given amount of expected or end-of-period wealth, must be reflected in an overall change in the value of the remaining assets which is of equal size but opposite sign.

   The above four features distinguish the work of Tobin and that of the New Haven school, along with the work of individuals such as Turnovsky (1977), compared with that of standard mainstream macroeconomics.[n.18]  The same features apply to the work and the approach being presented in this book. Thus, on the methodㅡconsistent accounting, consistent stock-flow analysis and consistent adding-up constraints on behavioural relationshipsㅡthe New Haven school and the New Cambridge school are in agreement.[n.19]  In addition, as already pointed out, the modelling of portfolio behaviour by households in the present book is essentially being inspired by the method propounded by Brainard and Tobin (1968).
[n.18] For instance, in Hicks's (1937) famous IS/LM model of Keynes's ^General Theory^ (1936), investment is carried on, and savings occurs, while the supply of money is assumed to be exogenous to the model.  What happens to wealth or debt at the end of the period is never discussed.  Whereas the money stock ought to be an endogenous variable, determined by the system, it is assumed to be exogenous and controlled by the monetary authorities.  As pointed out by Tobin (1982a: 187), 'the convenient strategy is to model the determination of asset prices and interest rates as a temporary stock equilibrium independent of flows of new saving'.  The stock-flow consistent approach to macroeconomic modelling, advocated here and advocated by Tobin, precisely goes beyond this temporary equilibrium, where time seems to be frozen and the flows of investment and household saving have no impact on fixed capital, debt, wealth, and money stocks.  The IS/LM model is only one slice of time (Tobin 1982a: 172), and a bad one at that.
   However, agreement on the method does not preclude disagreement on the model. ( ... )

1.6 Links with the post-Keynesian school

( ... ... )
( ... ... )
( ... ... )
( ... ... )

   This focus on the monetary side of production, debt and portfolio behaviour requires a serious examination of the banking system and of the financial system more generally.  Banks and their balance sheets have to be fully integrated to the production process, and interest flows have to be taken into account explicitly.  Our accounting framework will allow us to do just that. In addition, this framework will allow us to describe and understand the monetary circuit, that is, the monetary creation, circulation and destruction that accompanies production and wealth creation.  The role of government expenditures, and their link with monetary creation and interest rates prevailing on government securities will also be understood through the use of the same rigorous accounting framework.  In particular, that the money stock is ^endogenous^, as post-Keynesians such as Kaldor (1970a, 1982) and Robinson (1956, ch. 23) have long asserted, will be a crucial element of our models.

   Another feature of post-Keynesian models, which can be associated with the ^principle of effective demand^, is that market clearing through prices does not usually occur except in financial markets.  The real markets, those for products and labour, are assumed to be demand-led.  Full employment of labour is not assumed, nor is full employment of capacity, although, in the later chapters, where the possibility of inflation is introduced, high levels of employment or capacity will be assumed to generate inflationary pressures.  In that sense, one can say that our later models will be demand-led but eventually supply constrained.  Post-Keynesians believe that if market forces based on price clearing were to act on the labour market, they would generate instability.  As to the product markets, when dealing with the simplest models it will be assumed that supply adjusts to demandㅡthe reverse of Say's lawㅡwhile when dealing with more realistic models there will be another sort of quantity adjustment, a partial one, through inventories.  It follows that the models to be described are typically ^Keynesian^: product market clear through quantity adjustments, and the models are ^demand-led^.  The lack of production capacity, brought about by insufficient past investments will not be discussed here although it may provide a possible explanation of current unemployment.

( ... ... )

1.7 A sketch of the book

1.7.1 How the book was written

( ... ... )
( ... ... )

1.7.2 And how it should be used

As most of our models do not lend themselves to analytic solution, we strongly recommend readers to carry out simulations for themselves (Table 1.4). It will be via the experience of trying out alternative values for exogenous variables and parameters – and, indeed, by changing the models themselves─that major intuitions will be achieved. It will be found that key results will be far less arbitrary (less open to the ‘garbage in garbage out’ gibe) than one might suppose. The reader will be able quite easily to verify our results and conduct his or her own experiments because our colleague Gennaro Zezza has set up every one of our models (complete with data and solution routine) in a form that can be readily accessed.[n.24]
[n.24] at www.gennaro.zezza.it/software/models.

( ... ... )

Appendix 1.1: Compelling empirical failings of the neo-classical production function ( ... ...)

Appendix 1.2: Stock-flow relations and the post-Keynesians ( ... ... )

2013년 11월 16일 토요일

[J. Robinson's] Time in Economic Theory (1980)

지은이: Joan Robinson
출처: KYKLOS, Vol. 33, 1980

※ 발췌 (excerpt):

* * *

'Today' is at the front edge of time.  It moves continuously forward with an ever lengthening past behind it.  Any event that occurred at any date in history occurred when that date was 'today'.  We attempt to understand its causes, which lay in its own past and to trace its consequences which followed in its own future.  The future up to today of any event in the past has already happened.  As would-be social scientistsㅡhistorians and economistsㅡour relations to an event in the past and an event taking place 'today' are radically different.  The consequences of past events can, in principle, be known, or at least discussed, while the consequences of a present event can, at best, be predicted with a range of possibilities which may turn out not to have been correctly anticipated.  This is a necessary condition of human life.  Life as we experience it would not be possible if the future was known for certain.
There was a young man who said ‘Damn!
Now I perceive that I am
A creature that moves
In predestinate grooves
Not even a bus, but a tram’.
   He was wrong.  'Today' is influenced, but not completely bound, by the past.  Any action or decision taken today is either the result of blind habit and convention or it is directed towards its future consequences, which cannot yet ben fully known.

   There is a third kind of time which is met with in economic theory, that is, logical time in a specified model.


In a properly specified stationary state, there is no distinction between any one day and any other.  On a properly specified growth path, such as a von Neumann ray, exhibiting a particular pace of expansion of employment and of a specified stock of means of production, there is no movement forward and upward or backward and downward, except the movement of the reader's eye along the curve.

   Unfortunately, the great majority of models in the textbooks are not properly specified.  Take, for instance, the familiar Marshallian cross of supply and demand curves showing an equilibrium point in the middle.  At a price above the equilibrium level, offer exceeds demand, and below, demand exceeds offer.

   Now we are told, if price at any moment is not at the equilibrium level, it will tend towards it.  This means that historical events are introduced into a timeless picture.  As Professor SAMUELSON kindly explained to me, ‘When a mathematician says “y rises as x falls”, he is implying nothing about temporal sequences or anything different from “When x is low, y is high”’ [n.1]
[n.1] See J. ROBINSON, 'Misunderstandings in the Theory of Production', ^Greek Economic Review^, Vol. 1, 1, p. 4.
   To move implies a temporal sequence.  To fill in the story of a movement towards equilibrium, a complicated dynamic process must be specified and to specify a process that will actually reach equilibrium is by no means a simple matter. [n.2]
[n.2] See A. MEDIO, 'A Mathematical note on equilibrium in value and distribution', ^Economic Notes^, Siena, Vol. 7, 23 (1978)
   The other favorite diagram in elementary neoclassical textbooks is an isoquant showing a given output produced by different combinations of 'capital' and labour.  The question, raised by THORSTEIN VEBLEN IN 1908 and by myself in 1953, as to whether a 'quantity of capital' is a number of dollars or a stock of productive equipment, has not yet been answered, but even if we allow them to specify it as a number of tons of putty, they are not out of the wood.  Two points on the isoquant represent two different techniques of production, one with a higher ratio of putty to men employed than the other.  A movement from one to the other would involve augmenting the stock of putty or dismissing some workers.  Before we can go on with the story, we want to know which.

   MARSHALL was aware of the difficulty. [n.3]  He drew a long-period supply curve going forward through time, with economies of scale and learning by doing.  At any date that had once been reached, he conceived that there was a curve running backwards showing lower costs than on the forward curve because economies that have once been achieved would not be lost if demand were to shrink so that output had to be reduced.  But this device raises more problems than it solves.
[n.3] ^Principles^, Appendix H.
   A pseudo-production function (though I confess I was the first to draw one) is not a legitimate construction.  It exhibits different techniques, each with the appropriate stocks of equipment already in being.  This was a protest against a production function with putty capital but it did not go far enough.  It led on to a protest against confusing comparisons of imagined equilibrium positions with movements through historical time.

   SRAFFA's model escapes these difficulties if we interpret it in terms of comparisons of possible self-reproducing states.  There are two completely separate sets of comparisons.  One is of different technological systems, which is hinted at in Part III of ^Production of Commodities ...^  The other is of different distributions between wages and profits of the net output in single system.  There is a great deal to be learned from this model, particularly in a negative direction.  It is a ^Prelude to a Critique of Economic Theory^.  The theory which cannot survive the critique is the notion that the rate of profits in a capitalist economy is determined by the relations between 'factors of production' expressed in the concept of the 'marginal productivity of capital'.  But as the basis for analysis in a positive direction there is a difficulty about the specification of SRAFFA's model in terms of logical time.  The difficulty arises already in the first part of the argument before joint products and fixed capital are introduced; in the present context we need not go beyond it.

   The technical conditions of the model are described in a 'system' of input-output equations in physical terms.  There is the same turnover period for each element in the system.  The labour force, working with the inputs, replaces them with a surplus which is divided between wages and net profits at the end of the period.  This entails that at the beginning of the period there were stocks of the required inputs in existence in the correct proportions.

   SRAFFA conducts the analysis in terms of ^changing^ the share of wages in net output but this cannot be taken literally for a given share puts the model on to a predestinate tramline.  The argument must be conducted in terms of ^comparing^ different shares with the same technical system.  To any given share there corresponds a particular rate of profits, uniform throughout the system, a patter of prices of inputs and outputs, and a pattern of ratios of gross profits to the wage bill (profit margins) in the various industries.

   Many high-theorists are fastidious about mentioning money but I do not see any objection to introducing an arbitrary money-wage bill per period, and reckoning prices and profit margins in money terms.

   Now, the difficulty is that there is no relation between distribution and the physical composition of net output.  The wage is a share of net output, whatever it may be made of.  If growth is going on, part of net output consists of investment goods which workers' households cannot consume.  We can evade this problem by putting the model into a stationary state so that all net output is consumedㅡthrowing the wage, as SRAFFA says, into the limbo of non-basics.  Then net output may be conceive to be made up of homogeneous baskets of consumable goods, but still it is unnatural to postulate that rentiers take their share in the same proportion of various items that go to workers' households.

   This problem arises because there is no causality in SRAFFA's system.  The capitalists do not decide what labour to employ, what prices to set and what investment plans to draw up.  All they ca do is meekly to fulfil the equations that the observing economist has written down.  The only limitation on what the equations may be is that the workers' share of consumable goods is enough to support life.

   But if we are to introduce decisions into the model, we must introduce time.  Decisions are taken in the light of beliefs about their future consequences.  To make the model coherent, we must endow the capitalists with correct foresight as to what composition of output and what pattern of prices will maximise their profits.  Then the division of net output as between wage goods and luxury items is made to fit the distinction of income between workers and rentiers.  Each rate of profits, with a given basic technology, must be conceived to have an appropriate composition of the flow of net output.

   In a short-period model, there is not correct foresight.  There are individual expectations which need not be consistent with each other and which may turn out later to have been mistaken.  Productive capacityㅡthe stocks of inputs and training of the labour forceㅡhas been brought into existence by past events; it is whatever it is.  Capitalists, taken one with another, are offering employment at certain wage rates in order to produce a particular flow of output and households are deciding upon a particular flow of purchases.  The consequent interaction of individual decisions is seen in the total composition and prices of total flow of output and its distribution between wages and gross profits.  This brings about the realisation of surplus value, in Marxian language, or the equalisation of savings with investment, in Keynesian language.

   In working out the relationship between the share of wages in net output, and the corresponding uniform rate of profits on capital, SRAFFA's model cannot evade the distinction between the future and the past.


We certainly would not expect, in studying past history, to find a date at which a uniform rate of profit was ruling in the capitalist world, or in any one country comprised by it.  The construction of a long-run model does not lead up to any plausible hypotheses about reality.  It is useful for eliminating contradictions and pointing towards causal relations that will have to be taken into account in interpreting history.  Nor should we expect to find a period in which technology can be represented in a single system of equations or in an orderly series of vintages.  The analysis for comparing technologies has unfortunately run up the blind alley of the pseudo-production function, which has held up the development of long-period theory for the last twenty years.  To construct models that cannot be applied is merely an idle amusement.  It is only by interpreting history, including the present in history, that economics can aspire to be a serious subject.

   A notable practitioner of the discipline, E.H. CARR, has maintained that the study of history is of the same nature as the study of physical science:
All thinking requires acceptance of certain pre-suppositions based on observation which make scientific thinking possible, but are subject to revision in the light of that thinking. These hypotheses may well be valid in some contexts or for some purposes, though they turn out to be invalid in others. The test in all cases is the empirical one whether they are in fact effective in promoting fresh insights and adding to our knowledge.  The methods of RUTHERFORD were recently described by one of his most distinguished pupils and fellow-workers: 
"He had a driving urge to know how nuclear phenomena worked in the sense in which one could speak of knowing what went on in the kitchen.  I do not believe that he searched for an explanation in the classical manner of a theory using certain basic laws; as long as he knew what was happening he was content."
This description equally fits the historian, who has abandoned the search for basic lows, and is content to enquire how things work.' [n.4]
[n.4] E.H. CARR, ^What is History?^, pp. 53-54, Macmillan (1961)
   The study of history and of natural phenomena are social activities.  There is no point in trying to justify them.  Like climbing Everest, the motive for studying society is because it is there.  Knowledge of physics has produced enormous practical consequences for good and ill. Knowledge of history, as it filters down to the man in the street, produced political consequences.  But if any study is conducted with a view to its consequences, it is liable to become corrupted.  A serious subject must be studies, with an open mind, for its own sake.

   Here the study of society and of the physical universe are, in priniciple, alike but the difference of degree is enormous.  The inclination to bend the evidence in favour of a pre-conceived result is much more prevalent when human beings are studying human society than when they are studying the external world, and the discipline of the subject to prevent it is much weaker.

In order that science may continually break through the invisible barriers of its own paradigmatic categories, each scientist is encouraged to be an imaginative source of interpretation, both of his own contributions and of the work of other scientists.
On the other hand, nothing may be published as scientific information without careful, critical scrutiny by editors, referees and reviewers.  The highest standards of instrumental accuracy and logical necessity are imposed on all scientific communications.  Experiments are conscientiously repeated and theoretical calculations tested by alternative procedures.  Every scientific paper, ostensibly building on the preceding work that it cites, carries an implied or open criticism of much of that work, which it seeks to validate or disconfirm and supersede.  Review articles, colloquia and research monographs delineate controversial issues, and delicately point out the deficiencies of many reputable research contributions.
Experienced scientists know, indeed, that real progress in research is slow and painful, and that many experimental observations and plausible arguments will not stand up for long under expert questioning.  If science is to evolve, it must continually purge itself of misconceptions, follies and practical errors: there must be preserved a central store of absolutely reliable knowledge, from which to draw in evaluating novel ideas and on which, very slowly and carefully, to build.  In order that science may retain its reliability and credibility, each scientist is expected to exercise critical vigilance over his own work and the claims of his contemporaries.
This truly remarkable and civilized behaviour amongst scientists we take for granted: these are the standards against which occasional pathologies are judged.  And if those who rule societyㅡaristocrats or democrats, capitalists or socialists, conservatives or radicalsㅡwant scientific knowledge on which they can rely, they must not allow the inner tension of science to slacken, break, or overbalance.  According to the narrow logic of bureaucratic planning, it is a wasteful, irrational system that ought to be made efficient and economical.  But by encouraging innovation, yet conserving past achievement, by calling the gambling competitive spirit from each of us, yet making us also the guardians of truth and the judges of quality, it is remarkably successful as the source of many wonders.' [n.5]
[n.5] JOHN ZIMAN, ^Reliable Knowledge^ (1978), C.U.P., p. 132
   These standards do not prevail in the social sciences and it seems vain to expect that they ever could.  In the absence of a decisive and agreed method for reading the evidence from history, the choice between rival hypotheses is influenced by psychological and political factors not susceptible to pure reason. Thus hypotheses are turned into doctrines.

   Marx set out to discover 'laws of motion' of the capitalist system as it had emerged in the Western world and he made bold predictions about what for him was the future.  Now a good stretch of that future is our past.  Here we have an opportunity to apply scientific method to the study of our own society, checking his hypotheses with actual results.  In the writing of history, this has borne good fruit but in economics it has been wasted, for the most part, in a theological style of verbal disputes.

   The short-period theory in Marxㅡthe process of the realisation of surplusㅡas it has been developed by Kaleckiㅡhas laid the foundation for an analysis of employment, distribution and effective demand and of the consequences (though not of the causes) of changing technological knowledge.

   Nowadays, hypotheses based on this line of thought are swamped in orthodox teaching by the doctrines of monetarism.  At the present time (1979) a policy based upon those doctrines is actually being carried out in the U.K.  This will provide a rare chance to show which of two rival hypotheses is going to prove to be the least correct.


In expounding economic theory, the statement is often made that such and such will happen 'in the long run.' For MARSHALL, the long run is a period of ^future^ time after some event has occurred.  An unforeseen rise in the demand for fish, at a certain date, causes its price to rise.  High profits attract investment into the business and the subsequent higher flow of output will bring the price down.  MARSHALL implies that the price will come back to more or less where it was before, but predictions of this kind are usually guarded by the phrase 'other things equal'.  The Marshallian method of exposition is to attempt to trace the effects over the future of a particular event happening 'today' by the one-at-a-time method, that is to say by assuming that we know what would have happened over that particular period of future time if this event had not occurred.  This could be specified in a model where all elements are under the control of the observing economist: MARSHALL makes the step from a model to reality by an act of faith.  He knows that other things in fact will not be equalㅡhistory marches onㅡbut he supposes that it is possible to trace the effects of a single specified event ^as though^ it was the only change that occurred at a particular date.

   The weak point in the argument is that he cannot specify ^what^ would have occurred in the absence of this event.  He has a concept of the level of the normal rate of profit, but has no theory whatever of what causes it to be at any particular level or of a mechanism that causes it to be maintained at a constant level 'in the long run'.

   This arises from the basic fudge in MARSHALL's theory of the long-term rate of interest (which means the rate of profit) as the 'reward of waiting'.

   RICARDO postulated a mechanism which keeps real wages from remaining, over a stretch of some years of historical time, much above or below the level necessary to support the customary standard of life of the workers.  MARSHALL removed this cruel mechanism from his system and put nothing in its place.

   The search for a theory of the normal rate of profit is proverbially like looking in a dark room for a black cat that probably is not there.  If we had complete information about a period of past history we could see what were the flows of gross profits in various industries, what allowances were made for depreciation and so what made over the period in stocks of productive capacity and the ownership of financial wealth.  To account for what happened, we should have to enquire what conventions and expectations were guiding conduct at dates in the period when decisions were taken by firms and households.  Thus we could choose between the hypotheses that theorists have put forward and see which were the least unplausible.

   Then we should have a long-run theory based on past experience and we could use it to predict what will be the future provided that no relevant change takes place in the conditions prevailing in the past.

   Unfortunately, when our predictions turn out to have been incorrect, we should have the fresh task of finding out whether there has been a relevant change or whether our theory was not correct in the first place.


Economics can never be a serous subject on the place of physics but we can make it a great deal less frivolous than it is at present.

   We must throw out concepts and theorems that are logically self-contradictory, such as the general equilibrium of supply and demand, the long-run production function, the marginal productivity of capital and the equilibrium size of firms.

   In the space thus cleared, we can assemble the hypotheses about the world we are living in which seem to be surviving best.  In commodity markets, prices fluctuate under the influence of changes in the relations of supply and demand, without ever tending towards stability.  In corporate industry, prices are set by the producer in relation to costs, but since costs include depreciation, ^net^ proceeds can be known only after the event.  These prices are not much affected by the volume of demand but are sensitive to changes in money costs and in taxation.

   The most reliable part of our apparatus is the analyses of effective demand initiated by KEYNES and KALECKI.  Swings of activity must be seen, not as starting up from cold, but as overlaying slow long-run changes in productive capacity produced by accumulation, technical change (including changes in methods of operation of the labour force) and alterations in the composition of output.  The interaction between the long-run and the short-run consequences of technical innovations is a complicated subject which requires more study.

   The evolution of business activity and trade-union policy should be approached in the spirit of natural-history observation of the behaviour of classes and groups.

   The analysis of international trade should be preceded by an inquiry into the meaning of a 'nation' in the relevant respectsㅡa question which nowadays is not so simple as used to be supposed.

   All this, and much more, indicates work to be done, provided that we give up the search for grand general laws and are content to try to enquire how things happen.