What can economic theory contribute to our understanding of the COVID-19 pandemic? Upon being asked this question, most people would doubtlessly give answers ranging between little and nothing. These answers would reflect the intuition that COVID-19 mostly presents problems for public health, for which knowledge of epidemiology and related medical fields would be of far greater relevance than knowledge of economics. Sure, one can recognize that COVID-19 requires budgetary appropriations and entails regulatory impositions; while these are necessary to deal with the pandemic, they are secondary to public health all the same. This type of response would surely describe most people’s intuitions. And there is no doubt that intuitions are often good guides to follow, as the idea of emotionalRead More »
Articles by Richard Wagner
This book examines macroeconomic theory from an analytical framework provided by theories of complex systems, in contrast to conventional theories founded on aggregation. The resulting difference in analytical perspectives is huge: the macro level of society is not pursued through aggregation over micro entities. To the contrary, the micro-macro relation is treated as one of parts-to-whole, and this relation is approached from within an ecological scheme of thought. A society is a complex ecology of plans. That ecology, however, is not reducible to a single plan.
Conventional macro theory presents a national economy as a collection of such aggregate variables as output, employment, investment, and a price level, and seeks to develop theoretical relationships among those variables. InRead More »
In Inequality: An Entangled Political Economy Perspective, Mikayla Novak takes the analysis of inequality in a new direction by exploring the tension between fact and value that pervades most analyses of inequality. Novak offers new insights into the entangled character of political economic systems. It is customary to treat those systems as operating independently of one another, but Novak recognizes that this customary treatment leads thought astray. Inequality is a fact of social life, and a useful one at that, though Novak also recognizes the problematic qualities that can stem from inequality, while also recognizing that some of those qualities are intensified and not softened by political action. The overall thrust of Novak’s Inequality is to generate a deeper understanding of how itRead More »
Prevailing ideology holds that democracy is a system of government where people govern themselves. This ideology clashes with the unavoidable recognition that in any but small towns and villages governance is an activity wherein a few govern and the many are governed. This situation is an unavoidable feature of contemporary life with its elaborate and complex division of labor and knowledge. All of us are in the position of knowing a lot about a few things and little about most things. The central question Roger Koppl raises in Expert Failure is whether experts employ their expertise to the advantage of the general public or to the expert’s own advantage. Koppl advances strong reasons for being suspicious about the influence that experts exercise over the social organization of economicRead More »
Economists necessarily use models in thinking about their material because there is no alternative given the complexity of the material we face. But through what kinds of models might we use to theorize about the problem of governance? There is a choice between theoretical frameworks in this respect. The most common framework is organized around an equilibrium allocation of resources. One major problem with this framework is that resources cannot allocate themselves, for only people can do that. And they do so through interacting with one another inside some institutional framework that governs those interactions. In consequence, this paper conceptualizes governance from within a framework of entangled political economy, in contrast to the standard framework of additive political economy.Read More »
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Read the preface to the new addition by Richard E. Wagner.
Volumes have been written about the welfare state, covering everything from taxation and regulation to bureaucracy and Social Security. But what are the institutions that make such a state possible, and what alternatives exist to create a better outcome? First published in 1989 and now reprinted with a new preface from the author, To Promote the General Welfare explores this question and demonstrates that economic and political theory are inextricably linked.
In this book, Wagner suggests that the current welfare state results from an institutional framework in which governments, acting on behalf of dominant political coalitions, attempt to redistribute wealth through piecemeal welfare legislation. But this government intervention
What does it even mean to identify and explore a tension within a scholar’s work? The range of explanations for the presence of tensions, and the consequences that might (or might not) flow from those different types, is covered by the preliminary remarks to Wagner’s essay. Tensions may be unrecognized problems, incoherence, or inconsistency problematic for an argument; but this does not exhaust the possibilities. They could reflect shifts in thought or, more fundamentally, dialectical elements, by nature refractory to treatment through simple, definitive assertions. Wagner discusses the use of aggregates in Buchanan’s treatment of the burden of public debt as an instance of a contradictory, problematic tension in Buchanan’s work. A contrasting, dialectic tension arises between twoRead More »
The Supremacy Clause of the US Constitution (Article VI, Clause 2) asserts the right of federal legislation to preempt state legislation. This clause makes sense in light of the Constitution’s creation of a free-trade zone. Under the Articles of Confederation, the individual states were highly protectionist, as Jonathan Hughes set forth in The Governmental Habit. The Supremacy Clause gave the federal government the power to rescind protectionist legislation.
It has long been noted that “all politics is local politics.” This strongly held sentiment is not generally friendly to free trade. More precisely, it is friendly when free trade does not hurt local interests; otherwise, it is protectionist. Thus, we see general support for the principle of free trade, accompanied by myriad instances
The term “tax state” originated in a controversy between Rudolf Goldscheid and Joseph Schumpeter over the treatment of Austria’s public debt in the aftermath of World War I. Goldscheid asserted that this debt represented a crisis for a state that relied on taxation. Schumpeter argued that the crisis was temporary and could be resolved by a one-time capital levy to reduce the debt, after which the state could resume its tax-based mode of operation. This chapter explains that Goldscheid’s analysis was more on the mark than Schumpeter’s, because perpetual crisis is a systemic quality of the admixture of private and collective property. Mitigation of this systemic crisis requires modification of political activity in relation to property rights, as illustrated by extending the principle that hotels are forms of city state.Read More »