Technological, economic and sociopolitical conditions for the energy transition [Rendere possibile la transizione energetica: condizioni tecnologiche, economiche e sociopolitiche]

Rendere possibile la transizione energetica richiede che le economie soddisfino diversi ordini di condizioni, che hanno natura non solo tecnologica ed economica ma anche sociale, politica e geopolitica. Queste condizioni sono profondamente interconnesse; comprenderle nella loro complessità richiede intanto che si superino alcune fondamentali assunzioni del dibattito e delle politiche correnti. Bisogna poi sviluppare un framework alternativo basato sull’intreccio fra cambiamento della struttura produttiva e degli assetti sociopolitici ad essa collegati. Questo framework deve integrare (i) le condizioni economiche e sociopolitiche che rendono possibile lo sviluppo di tecnologie adeguate a raggiungere gli obiettivi 'finali’ della transizione, e (ii) le condizioni che permettono al sistema produttivo e sociopolitico di passare da un dato stadio della transizione allo stadio successivo

Vulnerability, resilience and ‘systemic interest’: a connectivity approach

This paper analyzes the socio-economic dimension of vulnerability and resilience from the viewpoint of connectivity. While no consensus has yet emerged on the definitions of vulnerability and resilience or on their relationship, it has been recognized that both have an important normative dimension, in that whether a system is considered vulnerable or resilient depends on the interests of the stakeholders involved. The paper proposes a dimension of resilience and vulnerability that is likely to be shared across a significant spectrum of stakeholders. To do so, the paper analyses connectivity within social-ecological systems from a “Structural Political Economy” viewpoint. A key concept in this regard is “systemic interest”, which is defined as the interest of stakeholders to keep viable the system of connections within which they act. Systemic interest has desirable properties to conceptualize the normative dimension of vulnerability and resilience and leads to problematize their link with connectivity. In fact, it raises the question of what features of connectivity can be expected to lead to systemic interest, and how this impinges on vulnerability and resilience in different contexts. On the one hand, one might expect that a more interconnected system is more vulnerable to shocks, which propagate more easily throughout the system. On the other hand, such system might have a stronger systemic interest, so that a shock would trigger stakeholders’ reaction to counteract its effects and avoid systemic consequences. The paper points to the institutional conditions that might make either outcome more likely in any given context

Beyond “Austerity vs. Expansion”: Elements for a Structural Theory of Liquidity Policy

Recent years have been marked by a sustained, often inconclusive, debate between two opposing views of economic policy. Economists mainly concerned about the economic fluctuations associated with inflationary pressures, credit bubbles and bankruptcies, have turned to "austerity policies" as ways to restore confidence and make investment decisions attractive. On the other hand, other economists worried about deflationary pressures, liquidity shortages and unemployment have turned to expansionary policies designed to create a virtuous circle of consumer and investor confidence, leading to higher overall spending and self-sustaining growth. This article argues that a conceptual shift is needed to provide an adequate explanation of the fluctuations in a modern industrial economy and to provide effective guidance for stabilization and growth policy in the short and medium term. The article draws attention to the structural theory of economic fluctuations and crises formulated at the turn of the 20th century and suggests that this theory provides the conceptual elements needed to overcome the micro-macro dichotomy and understand the differentiated response patterns to shocks characterizing industrial economies. The article lays the groundwork for future discussions, highlighting the central role of aggregation levels and sectoral interdependencies as a mechanism for generating macroeconomic relations. It then examines the structural asymmetries that characterize economic dynamics, as well as the resulting opportunities and constraints of economic policy. The article concludes with the presentation of the elements of a structural theory of liquidity policy and its implications for the relationship between austerity and stimulation as a means of stabilization

Structural liquidity: The money-industry nexus

This paper addresses the relationship between liquidity and production activity. It argues that this relationship becomes fully evident only if one considers intermediate levels of aggregation, and in particular stages of production within each industrial sector and their interdependence across sectors. To illustrate this, the paper introduces the concept of structural liquidity, which denotes material funds that are endogenously formed within the productive system before one considers the provision of liquidity by means of money. Structural liquidity is analyzed by combining (i) the representation of the productive system as an arrangement of fabrication stages sequentially related in time; and (ii) the representation of the productive system as a set of interdependent industrial sectors. The analysis identifies the structural liquidity problem as the need to satisfy both a viability condition (deriving from sectoral interdependencies) and a full employment condition (deriving from the sequencing of fabrication stages). The analysis highlights previously unexplored trade-offs, which have wide-ranging implications for monetary and liquidity policy

Productive interdependencies, interests and systemic conditions: Elements for a political economy of industrial structures

This article outlines a route to reconnect political economy to the original themes of the discipline, and specifically the complex relations between the objectives of (individual and collective) actors in a polity on the one hand, and the material and social interdependencies that influence the pursuit of those objectives on the other hand. The article highlights the heuristic value of economic theories of interdependencies for i) identifying the internal structure of constraints within a political-economic system; and ii) reconstructing the partial interests of specific sectors or social groups and their weight in determining collective actions. In this light, the article analyses the relations between partial interests and systemic interest. Unlike the usual understanding of collective interest, the systemic interest associated with a set of interdependencies expresses the multiple ways in which the partial and sometimes diverging interests of individuals or groups may be compatible with the viability of the system as a whole. This approach is illustrated in the context of the material and social interdependencies that characterise the political economy of the Eurozone. In this connection, the essay shows that a focus on «intermediate aggregates» (as opposed to the usual macro and micro levels of analysis) may be necessary for identifying effective measures of economic and industrial policy

Political economy revisited: structures and objectives at the systemic level

Political economy, understood both as an object of study and as a type of investigation, developed from the widening and deepening of production interdependencies deriving from division of labour, and the need to pursue systemic objectives in larger and more complex political-economic systems. A central theme of political economy is therefore the intertwining of systemic objectives and the structure of interdependencies, which shape the constraints on the pursuit of those objectives. Economic theory has seldom addressed this intertwining, as it has typically focussed either on means-ends reasoning at the individual level or on the properties associated with economic structure. This paper calls for revisiting political economy by explicitly addressing the pursuit of objectives at the systemic level, which requires analysing how different representations of economic structure lead to identifying different objectives and conditions for their achievement

Economic interdependencies and political conflict: the political economy of taxation in eighteenth-century Britain

The recent financial crisis has highlighted conflicts of interests between socio-economic groups over economic policy. We use representations of economies as systems of interdependencies among productive sectors to conceptualize economic and political cleavages in terms of the contingent interplay of economic interdependencies between sectors and political conflict between the groups that represent those sectors. In doing so, we propose a structural and historical approach, which is illustrated with reference to three moments in the evolution of the eighteenth-century British fiscal system. Each of these case studies (the Beer Taxes of the 1690s, the Excise Crisis of 1733, and the Income Taxes of the Napoleonic Wars) reveals a different dimension of our approach. We close with some reflections on the conditions under which political conflict may be sustainable and provide directions for further inquiry.This is the author accepted manuscript. The final version is available from Società Editrice il Mulino via http://dx.doi.org/10.1428/78897

A Bridge over Troubled Water: A Structural Political Economy of Vertical Integration

This article proposes a new interpretation of the logical process of vertical integration, exploring its socio-political dimension. The first step is to show that models of industrial interdependencies (in the Leontief and Sraffa formulations) and vertically integrated models (in the Pasinetti formulation) imply profoundly different views on production, distribution, and socio-political conflict. The next step is to focus on the process of vertical integration in itself: on its being a ‘bridge’ between such different views. Because analytically equivalent representations of production have such different socio-political implications, economic structures cannot be seen as univocally determining economic interests or conflicts in society. This results opens up a new field for structural analysis: studying how the formation of interests in society is influenced, but not determined, by economic structures. The argument suggests a route to address the socio-political dimension of economic structures, which is largely left on the background by structural economic analysis

Sul ritorno dell'economia politica

The transformations of political economy since its formative period in the late 16th-early 17th century (Bodin, Botero, Serra, Montchréstien) define its object as a field of possibilities. A dynamic (that is, historical) view of political economy is therefore a condition for identifying the relationship between different theoretical frameworks addressing the economic domain. The relationship between ends and means is central to the conceptual structuring of that domain and is at the root of the cleavages and overlaps that characterize the dynamics of economic theory. This essay highlights the central role of interdependencies in the construction of economic theory and highlights their importance both for identifying the internal structure of constraints in the economy and for assessing the relative weights of partial interests that are at the origin of collective actions. The essay also highlights the intertwining of material and social interdependencies in the dynamics of economic theory, and discusses the relationship between partial interests and forms of systemic interest. The latter relationship highlights the possible coexistence of coalitions and conflicts within the same system of interdependencies and makes such coexistence to depend on the internal, multi-level structure of interdependencies in the polity. This analytical framework is then applied to the assessment of multiple possible visualizations of systemic interest in the Eurozone

Explaining Structural Change: Actions and Transformations

Theories of structural change identify the range of transformations that are possible under given economic structures. However, in order specify a path of change out of those which are possible, these theories need to make explicit or implicit assumptions about actions taking place within structures. This, we argue, suggests that (i) these theories can identify potential, but not actual paths of change; and (ii) structural change is to some degree open-ended, because existing structures open up a range of possibilities but do not determine the specific actions taken therein. In order to explain which path of structural change is activated under specific historical conditions, we need to study how actual actions take place within structures. The paper suggests a way to do so, pointing to the interface between theory, which highlights possibilities for structural change, and history, which may 'close' such open-endedness in different ways depending on context