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Time: 4.00pm - 6.00pm
Venue: Room 4006, John Galsworthy building, Penrhyn Road campus, Penrhyn Road, Kingston upon Thames, Surrey KT1 2EE
Please join us for this event as part of the Economic Department Research Seminar Series.
‘How Orthodox Economics protects itself: The case of International Trade during the period when the Neoclassical version of Comparative Advantage was being developed and refined' by Eithne Murphy (National University or Ireland - Galway)
The purpose of this paper is not so much to challenge comparative advantage as to interrogate the arguments that neoclassical economists invoked to defend comparative advantage from its critics. Among the arguments raised by critics of a liberal trade policy were: unemployment; heterogeneous productivity of resources across sectors; and dynamic considerations as to how a country's productive power was best developed. The immunizing strategies used by neoclassical protagonists included: dismissal of the case due to its incompatibility with core neoclassical constructs (the nature of which have changed over time); consignment of the issue to another sub-discipline in economics; blatant misrepresentation of the argument; and innocuous acceptance, allied with a failure to incorporate or address the challenge until such time as it could be refuted with the tools available. It is argued that these strategies are revealing of the nature of neoclassical economics and its core commitments, showing that , inter-alia, it is primarily a tool-driven discipline divorced from social reality, but also opportunistic in how it has developed. The exercise also underlines precisely what is lost by a failure to read original sources in the history of economic thought.
This paper builds a continuous time Goodwin model with price dynamics and an endogenous interest rate that depends positively on debt-capital stock ratio. We find that the economy displays two equilibria, one low debt-capital ratio and a positive inflation and one with negative inflation and high debt-capital ratio. The "good" equilibrium is only locally stable whereas the "bad" equilibrium is unstable. We show that, depending on its magnitude, a debt-write-off can push the economy from a deflationary spiral and exploding debt to the basin of attraction for the "good" equilibrium with low debt.
Eithne Murphy is a lecturer at the National University of Ireland, Galway. Past work has included: agricultural and environmental issues, empirical work on cost of living for heterogeneous groups and the cost of children; and issues in international trade, including European integration. Latterly, she has become interested in history of economic thought and economic methodology. She obtained a PhD from SOAS in 2013. The title of her thesis was The Evolution of Trade Theory: An exercise in the construction of surrogate or substitute worlds?
Devrim Yilmaz took his PhD in Economics from University of Manchester on public spending, growth and welfare. He worked as a Post-Doctoral Teaching Fellow at University of York and as a Lecturer in Macroeconomics at University of Manchester, and is currently a Senior Lecturer in Economics at Kingston University. His research interests include stock-flow consistent models, agent-based models, continuous time dynamic models and and monetary theory of production. He teaches macroeconomics, money banking and financial markets and economic modelling.
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Contact: Antoine Godin
Directions to Room 4006, John Galsworthy building, Penrhyn Road campus, Penrhyn Road, Kingston upon Thames, Surrey KT1 2EE: