Related papers: Shifting Policy Strategy in Keynesianism
The governance of open-weight artificial intelligence (AI) models has been framed as a binary choice: openness as risk, restriction as safety. This paper challenges that framing, arguing that access restrictions, without governed…
The paper discusses various practical consequences of treating economics and finance as an inherently dynamic and chaotic system. On the theoretical side this looks at the general applicability of the market-making pricing approach to…
Most finance studies are discussed on the basis of several hypotheses, for example, investors rationally optimize their investment strategies. However, the hypotheses themselves are sometimes criticized. Market impacts, where trades of…
I develop a dynamic model of how internal capital markets in conglomerates respond to liquidity shocks when affiliated firms vary in innovation potential. A two-stage framework defines cutoff rules for when the conglomerate should liquidate…
The following measures against unemployment are proposed: In the short term, to promote greater income for the poorest sectors. It is shown that this can be paid with the resulting increased production, without losing income to the other…
Financial models do not merely analyse markets, but actively shape them. This effect, known as performativity, describes how financial theories and the subsequent actions based on them influence market processes, by creating self-fulfilling…
News media coverage of monetary policy is not a passive transcript of central-bank communication: it filters announcements, macroeconomic news, and editorial choices into narratives that move expectations and policy decisions. We embed…
At the zero lower bound, the New Keynesian model predicts that output and inflation collapse to implausibly low levels, and that government spending and forward guidance have implausibly large effects. To resolve these anomalies, we…
Environmental determinism in the past followed from the belief that the gods bestowed political power and the best possible weather on the sponsors of early scholars. Although later discredited in academia because of the associations with…
About the economic growth the Keynesian theorists defend circular and cumulative processes, benefiting the rich localities and harming the poorest, without external interventions. In these processes the Verdoorn law has an important role.…
This paper proposes a theory of pricing premised upon the assumptions that customers dislike unfair prices---those marked up steeply over cost---and that firms take these concerns into account when setting prices. Since they do not observe…
The first (Russian) edition of the book was among the first monographs on econophysics. The book gives an explanation of several intriguing phenomena, providing new insights and answers to some deeply vexing questions. Why the economic…
Our goal is to compute a policy that guarantees improved return over a baseline policy even when the available MDP model is inaccurate. The inaccurate model may be constructed, for example, by system identification techniques when the true…
This study presents a deep reinforcement learning approach for global hedging of long-term financial derivatives. A similar setup as in Coleman et al. (2007) is considered with the risk management of lookback options embedded in guarantees…
The existing theorization of development economics and transition economics is probably inadequate and perhaps even flawed to accurately explain and analyze a dual economic system such as that in China. China is a country in the transition…
This paper presents a model with the aim to follow, as closely as possible, the rationale of the macroeconomic model advanced by J.M. Keynes in his famous "The General Theory of Employment, Interest and Money", in order to provide a viable…
The Lucas critique has exposed the problem of the trade-off between changes in monetary policy and structural breaks in economic time series. The search for and characterisation of such breaks has been a major econometric task ever since.…
The presence of uncertainty in policy evaluation significantly complicates the process of policy ranking and selection in real-world settings. We formally consider offline policy selection as learning preferences over a set of policy…
We formulate a flexible micro-to-macro kinetic model which is able to explain the emergence of income profiles out of a whole of individual economic interactions. The model is expressed by a system of several nonlinear differential…
Nowadays, it is thought that there are only two approaches to political economy: public finance and public choice; however, this research aims to introduce a new insight by investigating scholastic sources. We study the relevant classic…