Stability in a Network Economy: The Role of Institutions

We consider an economy in which agents are embedded in a network of potential value-generating relationships. Agents are assumed to be able to participate in three types of economic interactions: Autarkic self-provision; bilateral interaction; and multilateral collaboration through endogenously provided platforms.
We introduce two stability concepts and provide sufficient and necessary conditions on the network structure that guarantee existence, in cases of the absence of externalities, link-based externalities and crowding externalities. We show that institutional arrangements based on socioeconomic roles and leadership guarantee stability. In particular, the stability of more complex economic outcomes requires more strict and complex institutional rules to govern economic interactions. We investigate strict social hierarchies, tiered leadership structures and global market places.

Socialized credit and the working-class family economy: a comparative history of Britain and France 1900-2000

This paper provides a comparative analysis of working class consumer credit in Britain and France from the early twentieth century through to the 1980s. It indicates a number of similarities between the two nations in the earlier part of the period: in particular, in the operation of doorstep credit systems. For the British case study, we explore consumer finance offered by credit drapers (sometimes known as tallymen) whilst in France the paper explores a similar system that functioned in the coalmining communities around the city of Lens. Both methods operated on highly socialised relationships that established the trust on which credit was offered and long-term creditor/borrower relationships established. In the second part of the paper, we analyse the different trajectories taken in post-war France and Britain in this area of working class credit. In France this form of socialized credit gradually dwindled due to factors such as ‘Bancarisation’, which saw the major banks emerge as modern bureaucratized providers of credit for workers and their families. In contrast, in Britain the tallymen (and other related forms of doorstep credit providers) were offered a new lease of life in the 1960s and 1970s. This was a period during which British credit providers utilised multiple methods to evade the hire purchase controls put in place by post-war governments. Thus, whilst the British experience was one of fragmented consumer loan types (including the continuation of doorstep credit), the French experience (like elsewhere in Europe) was one of greater consolidation. The paper concludes by reflecting on the role of these developments in the creation of differential experiences of credit inclusion/exclusion in the two nations and the impact of this on financial inequality.

The Dark Side of Nudging: The Ethics, Political Economy, and Law of Libertarian Paternalism

Libertarian paternalism, as advanced by Cass Sunstein, is seriously flawed, but not primarily for the reasons that most commentators suggest. Libertarian paternalism and its attendant regulatory implications are too libertarian, not too paternalistic, and as a result are in considerable tension with ‘thick’ conceptions of human dignity. We make four arguments. The first is that there is no justification for a presumption in favor of nudging as a default regulatory strategy, as Sunstein asserts. It is ordinarily less effective than mandates; such mandates rarely offend personal autonomy; and the central reliance on cognitive failures in the nudging program is more likely to offend human dignity than the mandates it seeks to replace. Secondly, we argue that nudging as a regulatory strategy fits both overtly and covertly, often insidiously, into a more general libertarian program of political economy. Thirdly, while we are on the whole more concerned to reject the libertarian than the paternalistic elements of this philosophy, Sunstein’s work, both in Why Nudge?, and earlier, fails to appreciate how nudging may be manipulative if not designed with more care than he acknowledges. Lastly, because of these characteristics, nudging might even be subject to legal challenges that would give us the worst of all possible regulatory worlds: a weak regulatory intervention that is liable to be challenged in the courts by well-resourced interest groups. In such a scenario, and contrary to the ‘common sense’ ethos contended for in Why Nudge?, nudges might not even clear the excessively low bar of doing something rather than nothing. Those seeking to pursue progressive politics, under law, should reject nudging in favor of regulation that is more congruent with principles of legality, more transparent, more effective, more democratic, and allows us more fully to act as moral agents. Such a system may have a place for (some) nudging, but not one that departs significantly from how labeling, warnings and the like already function, and nothing that compares with Sunstein’s apparent ambitions for his new movement.

Review of Mark F. Chingono. The State, Violence and Development. The Political Economy of War in Mozambique, 1975–1992.

Book review of: Mark F. Chingono. The State, Violence and Development. The Political Economy of War in Mozambique, 1975–1992. Avebury (Aldershot, Brookfield USA, Hong Kong, Singapore, Sydney), 1996. 291 pp. Foreword by Keith Hart. Tables. Appendix. Selected Bibliography. Index. £42.00. $71.95. Cloth.

Similarity or Variation? Employee Representation and Consultation Approaches Amongst Liberal Market Economy Multinationals

This paper engages with the varieties of capitalism literature to investigate the employee representation and consultation approaches of liberal market economy multinational companies (MNCs), specifically Australian, British and US MNCs operating in Australia. While the literature would suggest commonality amongst these MNCs, the paper considers whether the evidence points to similarity or variation amongst liberal market headquartered MNCs. The findings contribute to filling a recognized empirical gap on MNC employment relations practice in Australia and to a better understanding of within category varieties of capitalism similarity and variation. Drawing on survey data from MNCs operating in Australia, the results demonstrated that UK-owned MNCs were the least likely to report collective structures of employee representation. Moreover, it was found that Australian MNCs were the most likely to engage in collective forms of employee representation and made less use of direct consultative mechanisms relative to their British and US counterparts. In spite of the concerted individualization of the employment relations domain over previous decades, Australian MNCs appear to have upheld more long-standing national institutional arrangements with respect to engaging with employees on a collective basis. This varies from British and US MNC approaches which denotes that our results display within category deviation in the variety of capitalism liberal market economy typology. Just as Hall and Soskice described their seminal work on liberal market economy (LME) and coordinated market economy (CME) categories as a “work-in-progress” (2001: 2), we too suggest that Australia’s evolution in the LME category, and more specifically its industrial relations system development, and the consequences for employment relations practices of its domestic MNCs, may be a work-in-progress.