An Outline of a Progressive Resolution to the Euro-area Sovereign Debt Overhang: How a Five year Suspension of the Debt Burden Could Overthrow Austerity

The present study puts forward a plan for solving the sovereign debt crisis in the euro area (EA) in line with the interests of the working classes and the social majority. Our main strategy is for the European Central Bank (ECB) to acquire a significant part of the outstanding sovereign debt (at market prices) of the countries in the EA and convert it to zero-coupon bonds. No transfers will take place between individual states; taxpayers in any EA country will not be involved in the debt restructuring of any foreign eurozone country. Debt will not be forgiven: individual states will agree to buy it back from the ECB in the future when the ratio of sovereign debt to GDP has fallen to 20 percent. The sterilization costs for the ECB are manageable. This model of an unconventional monetary intervention would give progressive governments in the EA the necessary basis for developing social and welfare policies to the benefit of the working classes. It would reverse present-day policy priorities and replace the neoliberal agenda with a program of social and economic reconstruction, with the elites paying for the crisis. The perspective taken here favors social justice and coherence, having as its priority the social needs and the interests of the working majority

Correlations between Ground and Excited State Spectra of a Quantum Dot

We have studied the ground and excited state spectra of a semiconductor quantum dot for successive numbers of electron occupancy using linear and nonlinear magnetoconductance measurements. We present the first observation of direct correlation between the mth excited state of the N electron system and the ground state of the N+m electron system for m up to 4. Results are consistent with a non-spin-degenerate single particle picture of the filling of levels. Electron-electron interaction effects are also observed as a perturbation to this model. Magnetoconductance fluctuations of ground states are shown as anticrossings where wavefunction characteristics are exchanged between adjacent levels.Comment: 8 pages pdf; gzipped ps available at http://www-leland.stanford.edu/group/MarcusLab/grouppubs.htm

Cops, Teachers, and the Art of the Impossible: Explaining the lack of diffusion of impossible job innovations

In their now classic Impossible Jobs in Public Management, Hargrove and Glidewell (1990) argue that public agencies with limited legitimacy, high conflict, low professional authority, and weak agency myths have essentially impossible jobs. Leaders of such agencies can do little more than cope, which is also a theme of James Q. Wilson (1989), among others. Yet in the years since publication of Impossible Jobs, one such position, that of police commissioner has proven possible. Over a sustained 17-year period, the New York City Police Department has achieved dramatic reductions in crime with relatively few political repercussions, as described by Kelling and Sousa (2001). A second impossible job discussed by Wilson and also by Frederick Hess (1999), city school superintendent, has also proven possible, with Houston and Edmonton having considerable academic success educating disadvantaged children. In addition, Atlanta and Pittsburgh enjoyed significant success in elementary schooling, though the gains were short-lived for reasons we will describe. More recently, under Michelle Rhee, Washington D.C. schools have made the most dramatic gains among city school systems. These successes in urban crime control and public schooling have not been widely copied. Accordingly, we argue that the real conundrum of impossible jobs is why agency leaders fail to copy successful innovations. Building on the work of Teodoro (2009), we will discuss how the relative illegitimacy of clients and inflexibility of personnel systems combine with the professional norms, job mobility and progressive ambition of agency leaders to limit the diffusion of innovations in law enforcement and schooling. We will conclude with ideas about how to overcome these barriers

Minsky, Monetary Policy and Mint Street: Challenges for the Art of Monetary Policymaking in Emerging Economies

This paper examines the emerging challenges to the art of monetary policymaking using the case study of the Reserve Bank of India (RBI) in light of developments in the Indian economy during the last decade (2003-04 to 2013-14). The paper uses Hyman P. Minsky's financial instability hypothesis as the conceptual framework for evaluating the endogenous nature of financial instability and its potential impact on monetary policymaking, and addresses the need to pursue regulatory policy as a tool that is complementary to monetary policy in light of the agenda of reforms put forward by Minsky. It further reviews the extensions to the Minskyan hypothesis in the areas of setting fiscal policy, managing cross-border capital flows, and developing financial institutional infrastructure. The lessons learned from the interplay of policy choices in these areas and their impact on monetary policymaking at the RBI are presented

The Crisis of Finance-Dominated Capitalism in the Euro Area, Deficiencies in the Economic Policy Architecture, and Deflationary Stagnation Policies

* For a more detailed elaboration on the macroeconomic theory of finance-dominated capitalism, see the respective chapters in my book The Macroeconomics of Finance-dominated Capitalism – and Its Crisis (Hein 2012a). The present paper is based on this theory, and it extends and updates the analysis of the euro crisis I have presented in Hein (2012b). I would like to thank Achim Truger for his helpful comments and Matthias Mundt for his valuable research assistance. The Levy Economics Institute Working Paper Collection presents research in progress by Levy Institute scholars and conference participants. The purpose of the series is to disseminate ideas to and elicit comments from academics and professionals. Levy Economics Institute of Bard College, founded in 1986, is a nonprofit, nonpartisan, independently funded research organization devoted to public service. Through scholarship and economic research it generates viable, effective public policy responses to important economic problems that profoundly affect the quality of life in the United States and abroad

Presupposition Triggers and Presumptive Interpretation

Pragmatic presuppositions are analyzed considering their relation with the notion of commitment, namely the dialogical acceptance of a proposition by an interlocutor. The attribution of commitments carried out by means of pragmatic presupposition is shown to depend on the reasonableness of the underlying presumptive reasoning, ultimately grounded on hierarchies of presumptions. On this perspective, the ordinary interpretation of pragmatic presuppositions as the “taking for granted” of propositions signaled by semantic or syntactic triggers becomes only the presumptive, prototypical interpretation of a complex linguistic and pragmatic phenomenon. It will be shown how the prototypical interpretation is subject to default in cases of conflicts of presumptions, which lead to reconstructing the speaker’s meaning non-presumptively at a pragmatic, semantic, or syntactic level. The phenomena of presupposition cancellation and neutralization can be explained in terms of presumptive and non-presumptive articulation and interpretation of an utterance, through which the speaker can impose, correct, or refuse implicit commitments

Has Globalisation Increased Inequality?

There has been no shortage of theories which purport to explain why globalisation may have, adverse, insignificant or even beneficial effects on income and earnings inequality. Surprisingly, the empirical realities remain an almost complete mystery. In this paper we use data on industrial wage inequality, household income inequality as well as measures of the economic, social and political dimensions of globalisation to examine this controversial issue. We find that the economic dimension of globalisation, and – less robustly – political integration, have exacerbated wage inequality in developed countries. In contrast, the impact of globalisation on both income and earnings inequality in less-developed countries has been negligible

Axiomatic Choice Theory Traveling between Mathematical Formalism, Normative Choice Rules and Psychological Measurement, 1944-1956

The following analysis is meant to contribute to a history of rational choice theory. More specifically, I provide a multi-layered account of rational choice theory in terms of its biography as a scientific object. I argue that its axiomatic version, choice theory traveled between different research sites, specified within the context of different mathematical formalisms and occupying different epistemic functions; it was being applied to prescribe rules of proper behavior, as representation of behavioral hypotheses, and as measurement device to capture individual values. New modifications of what I call 'axiomatic choice theory' did not fully replace old versions of it, which prevents the reconstruction of its 'travels' as a continuous process and acknowledges the different versions of axiomatic choice theory that are currently used in the social sciences, particularly in economics. Furthermore, by revealing the diversity of its manifestations within the context of social networks and within particular research sites, the account of axiomatic choice theory developed here will ultimately contributes to an explanation of the disunity and confusion surrounding current debates about rational choice theory and allows for providing a more nuanced picture of its nature and scope. Jacob Marschak's professional development is used as a guide through this history of axiomatic choice theory to illustrate its journey