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Time: 3.00pm - 5.00pm
Venue: Room 5006, John Galsworthy building, Penrhyn Road campus, Penrhyn Road, Kingston upon Thames, Surrey KT1 2EE
Speaker(s): John T. Harvey and Vince Daly
Please join us for this event as part of the Department of Economics Research Seminar Series.
‘Exchange Rates and the Balance of Payments: Reconciling an Inconsistency in Post Keynesian Theory ' by John T. Harvey (Texas Christian University)
Post Keynesians have developed trade and exchange rate theories that serve as alternatives to those used in Neoclassicism. That focusing on the former emphasizes the role of absolute advantage, while the latter argues that currency prices are set almost entirely by autonomous financial capital flows. These have both well-developed theoretical structures and ample empirical support-but, they are inconsistent! This emerges when one considers the fact that any theory of the current account balance is simultaneously a theory of the capital account balance. And, while Post Keynesian trade theory argues that an imbalance can exist in equilibrium, the exchange rate theory does not. Tentative solutions have been forwarded, but these reject other premises common to Post Keynesian analyses. The goal of this paper is to resolve the matter once and for all and by a means that leaves all essential conclusions unchanged. The key lies in explicitly modeling the manner in which trade flows are financed. Once it is acknowledged that they are endogenously-created and that they do not have any direct impact on currency prices, then it is possible to show that trade flows are a function of absolute advantages while exchange rates are driven by international finance.
‘Globalization and Unemployment in Pakistan' by Vince Daly (Kingston University)
This study analyses the impact of globalisation on unemployment in Pakistan, using annual data for the period 1980 to 2013. Using the ARDL econometric framework, we find that the economic, political and social aspects of globalisation differ in their effects. The data suggest that political and social integration, whilst beneficial in the short run, increase the long run expected unemployment rate. Economic integration appears to be only marginally beneficial in the short run; it is significantly beneficial in the long run but cointegration with the other aspects of globalisation means that it cannot fully counteract their undesirable long-run effect.
John T. Harvey is a professor of economics at Texas Christian University in Fort Worth, Texas. His primary teaching responsibilities include international monetary economics, macroeconomics, and contending perspectives in economics. The last, a review of contemporary schools of thought (and not the history of economic thought!), is required of all economics majors at TCU. Though John has authored a book on the latter (primarily so he'd have something to use in class!), his main areas of research are exchange rate theory and macroeconomics. He is a strong advocate of the use of system dynamics modeling as a Post Keynesian-friendly alternative to general equilibrium. John has published primarily in the Journal of Post Keynesian Economics and the Journal of Economic Issues and has two edited volumes and two monographs. In addition, he has a blog at Forbes.com called Pragmatic Economics. John is a dual citizen of the US and the UK, which allows him the tremendous freedom of deciding whether to live with Donald Trump or Theresa May. He is currently looking into claiming Irish citizenship through his grandfather.
Vince joined Kingston Polytechnic in 1974, becoming Head of the (then) School of Economics in 1988. In 2009 he retired from the Headship and was appointed Professor in recognition of his efforts to establish a research culture within the School. After a period as Director of Research, then Research Students' Tutor, he completed his retirement in 2016 and now works for free as "Professor emeritus". Vince considers himself to be an "applied econometrician" and currently contributes that perspective to several research projects with colleagues, ex-colleagues and his previous doctoral students. Vince suggests that his 1981 paper with George Hadjimatheou, in the JPE, possibly holds the departmental record for our shortest ever published article.
For further information about this event:
Contact: Antoine Godin
Directions to Room 5006, John Galsworthy building, Penrhyn Road campus, Penrhyn Road, Kingston upon Thames, Surrey KT1 2EE: