The Marginal Productivity Theory Of The Price Of Capital: An Historical Perspective On The Origins Of The Codswallop

Although it might have been expected that, by this point in time, the unacceptability of the marginal productivity theory of the return on capital would be universally agreed, that is evidently not the case. Popular textbooks still propound the dogma to the innocent. This note is presented in the hope that a succinct indication of the origins of the theory it will contribute to a more general appreciation of the unrealistic and illogical nature of this doctrine.

Still More On Why We Should Bury The Marginal Productivity Theory Of The Price Of Capital: A Supplementary Note

The purpose of this note is to supplement the author’s earlier remarks on the unsatisfactory nature of the neoclassical account of how the return on capital is determined. (See Strathclyde Discussion Paper 12-03: “The Marginal Productivity Theory of the Price of Capital: An Historical Perspective on the Origins of the Codswallop”). The point is made via a simple illustration that certain matters which are problematical in neoclassical terms are perfectly straightforward when viewed from a classical perspective. Basically, the marginalist model of the nature of an economic system is not fit for purpose in that it fails to comprehend the essential features of a surplus-producing economic system as distinct from one merely of exchange.

Suppliers of Priors: A Theory of Retailing Inspired by the Market for Chinese Antiquities

Adverse selection may thwart trade between an informed seller, who knows the probability p that an item of antiquity is genuine, and an uninformed buyer, who does not know p. The buyer might not be wholly uninformed, however. Suppose he can perform a simple inspection, a test of his own: the probability that an item passes the test is g if the item is genuine, but only f < g if it is fake. Given that the buyer is no expert, his test may have little power: f may be close to g. Unfortunately, without much power, the buyer's test will not resolve the difficulty of adverse selection; gains from trade may remain unexploited. But now consider a "store", where the seller groups a number of items, perhaps all with the same quality, the same probability p of being genuine. (We show that in equilibrium the seller will choose to group items in this manner.) Now the buyer can conduct his test across a large sample, perhaps all, of a group of items in the seller's store. He can thereby assess the overall quality of these items; he can invert the aggregate of his test results to uncover the underlying p; he can form a "prior". There is thus no longer asymmetric information between seller and buyer: gains from trade can be exploited. This is our theory of retailing: by grouping items together - setting up a store - a seller is able to supply buyers with priors, as well as the items themselves. We show that the weaker the power of the buyer�s test (the closer f is to g), the greater the seller�s profit. So the seller has no incentive to assist the buyer � e.g., by performing her own tests on the items, or by cleaning them to reveal more about their true age. The paper ends with an analysis of which sellers should specialise in which qualities. We show that quality will be low in busy locations and high in expensive locations.

A Theory of Wage Setting Behavior

Concerns for fairness, workers' morale and reciprocity infuence firms' wage setting policy. In this paper we formalize a theory of wage setting behavior in a simple and tractable model that explicitly considers these behavioral aspects. A worker is assumed to have reference-dependent preferences and displays loss aversion when evaluating the fairness of a wage contract. The theory establishes a wage-effort relationship that captures the worker's reference-dependent reciprocity, which in turn in uences the firm's optimal wage policy. The paper makes two key contributions: it identifies loss aversion as an explanation for a worker's asymmetric reciprocity; and it provides realistic and generalized microfoundation for downward wage rigidity. We further illustrate the implications of our theory for both wage setting and hiring behavior. Downward wage rigidity generates several implications for the outcome of the initial employment contract. The worker's reference wage, his extent of negative reciprocity and the firms expectations are key drivers of the propositions derived.

Validation of two echocardiographic indexes to improve the diagnosis of complex coarctations

Rapport de synthèse: Enjeux et contexte de recherche : la coarctation de l'aorte, rétrécissement de l'aorte thoracique descendante, est une des malformations cardiaques congénitales les plus fréquentes. Son diagnostic reste cependant difficile surtout lorsqu'elle est associée à la présence d'un canal artériel ou à une malformation cardiaque plus complexe. Dans ces contextes, les signes échographiques classiques qui posent habituellement le diagnostic (visualisation d'un rétrécissement juxtaductal et accélération au Doppler au niveau de l'isthme aortique) peuvent faire défaut ou être difficile à imager. La validation d'index basé sur des mesures anatomiques faciles à acquérir par échographie cardiaque, indépendantes de l'âge, de la situation hémodynamique et des malformations cardiaques associées représente une aide significative dans le diagnostic de la coarctation de l'aorte. Nous avons donc voulu valider par une étude rétrospective la fiabilité de deux index dans cette indication : l'index des artères carotido-sous-clavière (index CSA; rapport du diamètre de l'arc aortique transverse distal sur la distance entre les artères carotide et sous-clavière gauches) et l'index de l'aorte isthmique-descendante (index I/D; rapport des diamètres de l'aorte isthmique sur celui de l'aorte descendante). Notre article : nous avons rétrospectivement calculé la valeur des deux index (CSA et I/D) chez un groupe de 68 enfants avec coarctation et un groupe 24 cas contrôles apparenté pour l'âge et le sexe. Les enfants avec coarctation ont un index CSA et I/D significativement plus bas que le groupe contrôle (Index CSA : 0.84 ± 0.39 vs. 2.65 ± 0.82, p<0.0001 - Index I/D : 0.58 ± 0.18 vs. 0.98 ± 0.19, p<0.0001). Pour les deux index, ni la présence d'une autre malformation cardiaque, ni l'âge n'ont un impact sur la différence significative entre les deux groupes. Conclusions: notre recherche à permis de valider qu'un index CSA de moins de 1,5 est fortement suggestif d'une coarctation, indépendamment de l'âge du patient et de la présence d'une autre malformation cardiaque. L'index I/D (valeur limite 0,64) est moins spécifique que l'index CSA. L'association des deux index augmente la sensibilité et permet rétrospectivement le diagnostic de tous les cas de coarctation seulement sur la base d'une échographie cardiaque standard faite au lit du patient. Perspectives : cette étude rétrospective mérite d'être vérifiée par une étude prospective afin de confirmer la contribution de ces index à la prise en charge des patients suspects d'une coarctation de l'aorte. Cependant, la situation dans laquelle ces index pourraient avoir le plus grand impact reste encore à explorer. En effet, si le diagnostic postnatal de la coarctation est parfois difficile, son diagnostic prénatal l'est nettement plus. La présence obligatoire du canal artériel et l'existence d'une hypoplasie isthmique physiologique chez le foetus obligent le cardiologue foetale à observer des signes indirects, peu sensibles, d'une possible coarctation (prépondérance des cavités droites). La validation de l'index CSA et/ou de l'index I/D chez le foetus constituerait donc une avancée majeure dans le diagnostic prénatal de la coarctation de l'aorte.

Theory of mind tasks and executive functions: A systematic review of group studies in neurology.

A growing number of studies have been addressing the relationship between theory of mind (TOM) and executive functions (EF) in patients with acquired neurological pathology. In order to provide a global overview on the main findings, we conducted a systematic review on group studies where we aimed to (1) evaluate the patterns of impaired and preserved abilities of both TOM and EF in groups of patients with acquired neurological pathology and (2) investigate the existence of particular relations between different EF domains and TOM tasks. The search was conducted in Pubmed/Medline. A total of 24 articles met the inclusion criteria. We considered for analysis classical clinically accepted TOM tasks (first- and second-order false belief stories, the Faux Pas test, Happe's stories, the Mind in the Eyes task, and Cartoon's tasks) and EF domains (updating, shifting, inhibition, and access). The review suggests that (1) EF and TOM appear tightly associated. However, the few dissociations observed suggest they cannot be reduced to a single function; (2) no executive subprocess could be specifically associated with TOM performances; (3) the first-order false belief task and the Happe's story task seem to be less sensitive to neurological pathologies and less associated to EF. Even though the analysis of the reviewed studies demonstrates a close relationship between TOM and EF in patients with acquired neurological pathology, the nature of this relationship must be further investigated. Studies investigating ecological consequences of TOM and EF deficits, and intervention researches may bring further contributions to this question.

The longitudinal association between social functioning and theory of mind in first episode psychosis

Introduction. There is some cross-sectional evidence that theory of mind ability is associated with social functioning in those with psychosis but the direction of this relationship is unknown. This study investigates the longitudinal association between both theory of mind and psychotic symptoms and social functioning outcome in first-episode psychosis. Methods. Fifty-four people with first-episode psychosis were followed up at 6 and 12 months. Random effects regression models were used to estimate the stability of theory of mind over time and the association between baseline theory of mind and psychotic symptoms and social functioning outcome. Results. Neither baseline theory of mind ability (regression coefficients: Hinting test 1.07 95% CI 0.74, 2.88; Visual Cartoon test 2.91 95% CI 7.32, 1.51) nor baseline symptoms (regression coefficients: positive symptoms 0.04 95% CI 1.24, 1.16; selected negative symptoms 0.15 95% CI 2.63, 2.32) were associated with social functioning outcome. There was evidence that theory of mind ability was stable over time, (regression coefficients: Hinting test 5.92 95% CI 6.66, 8.92; Visual Cartoon test score 0.13 95% CI 0.17, 0.44). Conclusions. Neither baseline theory of mind ability nor psychotic symptoms are associated with social functioning outcome. Further longitudinal work is needed to understand the origin of social functioning deficits in psychosis.

Conservation of complex knotting and slipknotting patterns in proteins.

While analyzing all available protein structures for the presence of knots and slipknots, we detected a strict conservation of complex knotting patterns within and between several protein families despite their large sequence divergence. Because protein folding pathways leading to knotted native protein structures are slower and less efficient than those leading to unknotted proteins with similar size and sequence, the strict conservation of the knotting patterns indicates an important physiological role of knots and slipknots in these proteins. Although little is known about the functional role of knots, recent studies have demonstrated a protein-stabilizing ability of knots and slipknots. Some of the conserved knotting patterns occur in proteins forming transmembrane channels where the slipknot loop seems to strap together the transmembrane helices forming the channel.

Hemispheric asymmetry and theory of mind: Is there an association?

Introduction. In autism and schizophrenia attenuated/atypical functional hemispheric asymmetry and theory of mind impairments have been reported, suggesting common underlying neuroscientific correlates. We here investigated whether impaired theory of mind performance is associated with attenuated/atypical hemispheric asymmetry. An association may explain the co-occurrence of both dysfunctions in psychiatric populations. Methods. Healthy participants (n 129) performed a left hemisphere (lateralised lexical decision task) and right hemisphere (lateralised face decision task) dominant task as well as a visual cartoon task to assess theory of mind performance. Results. Linear regression analyses revealed inconsistent associations between theory of mind performance and functional hemisphere asymmetry: enhanced theory of mind performance was only associated with (1) faster right hemisphere language processing, and (2) reduced right hemisphere dominance for face processing (men only). Conclusions. The majority of non-significant findings suggest that theory of mind and functional hemispheric asymmetry are unrelated. Instead of ''overinterpreting'' the two significant results, discrepancies in the previous literature relating to the problem of the theory of mind concept, the variety of tasks, and the lack of normative data are discussed. We also suggest how future studies could explore a possible link between hemispheric asymmetry and theory of mind.

Unpacking the cognitive map: the parallel map theory of hippocampal function

In the parallel map theory, the hippocampus encodes space with 2 mapping systems. The bearing map is constructed primarily in the dentate gyrus from directional cues such as stimulus gradients. The sketch map is constructed within the hippocampus proper from positional cues. The integrated map emerges when data from the bearing and sketch maps are combined. Because the component maps work in parallel, the impairment of one can reveal residual learning by the other. Such parallel function may explain paradoxes of spatial learning, such as learning after partial hippocampal lesions, taxonomic and sex differences in spatial learning, and the function of hippocampal neurogenesis. By integrating evidence from physiology to phylogeny, the parallel map theory offers a unified explanation for hippocampal function.

Theory of mind and social functioning in first episode psychosis

There is evidence of associations between social functioning and theory of mind performance and between social functioning and negative symptoms in chronic psychosis. This study investigates these associations in those with first episode psychosis who are unaffected by factors related to long-term mental illness. Our first hypothesis states that there is an association between theory of mind and social functioning. The second hypothesis states that there is no association between symptoms of psychosis and social functioning. Methods. Fifty-two individuals with first episode psychosis were assessed for social functioning, theory of mind ability (using the Hinting test with verbal stimuli and the Visual Cartoon test with pictorial stimuli), and symptoms of psychosis. Multivariable logistic regression was used to examine associations. Results. Social functioning and theory of mind were associated when measured by the Hinting test (OR 1.70, 95% CI 1.08, 2.66), but not with the Visual Cartoon test (ToM jokes OR 0.61, 95% CI 0.15, 2.53). There was no association between social functioning and symptoms (psychotic symptoms; OR 0.95, 95% CI 0.81, 1.12; selected negative symptoms; OR 1.33, 95% CI 0.78, 2.25). Conclusions. Theory of mind assessed by verbal stimuli is associated with social functioning in a population with first episode psychosis. These findings may be related to language disorders in psychosis.

Luck and the control theory of knowledge

The dissertation accomplishes two aims: 1) to diagnose what prevents true beliefs from being knowledge; 2) to give an positive account of knowledge. Concerning the first aim, it offers an account of the notion of luck. It defends the view that luck is a form of risk and distinguishes two types of luck. Then, it applies the account to the problem of epistemic luck and distinguishes, accordingly, two types of epistemic luck. It is argued that these two types of epistemic luck explain the whole range of cases of not-known true belief. Concerning the second aim, the dissertation advances an account of knowledge in terms of the notion of cognitive control that deals with the two forms of epistemic luck distinguished.