The Money Metric, Price and Quantity Aggregation and Welfare Measurement

Hillinger, Claude

doi:10.2202/1534-6005.1098

Cited by 13 publications

(22 citation statements)

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“…I view the history as a conflict between empiricism and ideology, with the former often on the loosing side. A fuller exposition of this thesis along with references to some recent relevant literature is Hillinger (2006). Petty, a founding member of the Royal Society was personally involved in the scientific revolution occurring in his day.…”

Section: The Empirical Tradition At the Birth Of Economicsmentioning

confidence: 99%

“…On that basis, the economist Kenneth Arrow proved his famous 'impossibility theorem' 1 that is generally interpreted as meaning that there exists no rational method for aggregating individual preferences; hence, no rational justification of democracy. In Hillinger (2005) I have argued that, since Arrow's theorem relies on the ideologically motivated rejection of cardinal measurement, it proves no such thing. What the theorem did lead to was the death of political science as a positive discipline able to contribute to the growth of democratic institutions.…”

Section: Introductionmentioning

confidence: 99%

“…The measurement of real expenditure and inflation was the subject of Hillinger (2001Hillinger ( , 2002Hillinger ( , 2003aHillinger ( , 2003b. In Hillinger (2005) I extended the analysis to the representation and aggregation of voter preferences. Each of these articles had an analytical core, but also featured a conceptual inquiry that defined the problem and analyzed the shortcomings of the major proposed solutions.…”

Section: Introductionmentioning

confidence: 99%

“…In this context I also looked at the historical background and at ideological precommitments that have blocked the advance of the subject. The conflict between empiricism and various ideological commitments in the history of economics is analyzed at some length in Hillinger (2006). The present paper gives a broad overview of this work.…”

Section: Introductionmentioning

confidence: 99%

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Measurement in Economics and Social Science

Hillinger¹

2007

SSRN Journal

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The paper discusses measurement, primarily in economics, from both analytical and historical perspectives. The historical section traces the commitment to ordinalism on the part of economic theorists from the doctrinal disputes between classical economics and marginalism, through the struggle of orthodox economics against socialism down to the cold-war alliance between mathematical social science and anti-communist ideology. In economics the commitment to ordinalism led to the separation of theory from the quantitative measures that are computed in practice: price and quantity indexes, consumer surplus and real national product. The commitment to ordinality entered political science, via Arrow's 'impossibility theorem', effectively merging it with economics, and ensuring its sterility. How can a field that has as its central result the impossibility of democracy contribute to the design of democratic institutions?The analytical part of the paper deals with the quantitative measures mentioned above. I begin with the conceptual clarification that what these measures try to achieve is a restoration of the money metric that is lost when prices are variable. I conclude that there is only one measure that can be embedded in a satisfactory economic theory, free from unreasonable restrictions. It is the Törnqvist index as an approximation to its theoretical counterpart the Divisia index.The statistical agencies have at various times produced different measures for real national product and its components, as well as related concepts. I argue that all of these are flawed and that a single deflator should be used for the aggregate and the components. Ideally this should be a chained Törnqvist price index defined on aggregate consumption.The social sciences are split. The economic approach is abstract, focused on the assumption of rational and informed behavior, and tends to the political right. The sociological approach is empirical, stresses the non-rational aspects of human behavior and tends to the political left. I argue that the split is due to the fact that the empirical and theoretical traditions were never joined in the social sciences as they were in the natural sciences. I also argue that measurement can potentially help in healing this split.3

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Section: The Empirical Tradition At the Birth Of Economicsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Measurement in Economics and Social Science

Hillinger¹

2007

SSRN Journal

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“…I also elaborated the theory in the context of explicitly utility maximizing consumers and heterogeneous groups of such consumers. This work is reported in Hillinger (2003aHillinger ( , 2007.…”

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Science and Ideology in Economic, Political and Social Thought

Hillinger

2008

Economics

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Abstract:This paper has two sources: One is my own research in three broad areas: business cycles, economic measurement and social choice. In all of these fields I attempted to apply the basic precepts of the scientific method as it is understood in the natural sciences. I found that my effort at using natural science methods in economics was met with little understanding and often considerable hostility. I found economics to be driven less by common sense and empirical evidence, than by various ideologies that exhibited either a political or a methodological bias, or both. This brings me to the second source: Several books have appeared recently that describe in historical terms the ideological forces that have shaped either the direct areas in which I worked, or a broader background. These books taught me that the ideological forces in the social sciences are even stronger than I imagined on the basis of my own experiences.The scientific method is the antipode to ideology. I feel that the scientific work that I have done on specific, long standing and fundamental problems in economics and political science have given me additional insights into the destructive role of ideology beyond the history of thought orientation of the works I will be discussing. JEL: B40, C50, D6, D71, E32

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Diagnosing the UK productivity slowdown: which sectors matter and why?

Coyle

Mei

2023

Economica

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This paper explores the slowdown in labour productivity growth in the UK and other advanced economies by decomposing its growth into contributions from different sectors of the economy, looking at both within‐industry productivity growth and labour reallocation between sectors. We find that the within‐industry contribution is the main source of the slowdown. Comparing trends pre‐ and post‐2008, the aggregate productivity slowdown can be attributed largely to the manufacturing sector and the information and communication (ICT) sector. Disaggregating further, the UK productivity growth slowdown can be attributed mainly to transport equipment and pharmaceuticals within manufacturing, and computer software and telecommunications within ICT. Strikingly, these are advanced, high value‐added sectors considered to be strengths of the UK economy. Looking across other advanced economies, our results confirm that manufacturing and ICT sectors are the main drivers of the slowdown, to differing degrees. Part of the explanation for the slowdown in in these sectors may relate to the underlying question of how to construct deflators for a modern economy when technological and structural changes are leading to large relative price shifts. The structure and supply chains of the key slowdown sectors also merit further investigation.

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The Money Metric, Price and Quantity Aggregation and Welfare Measurement

Cited by 13 publications

References 0 publications

Measurement in Economics and Social Science

Measurement in Economics and Social Science

Science and Ideology in Economic, Political and Social Thought

Diagnosing the UK productivity slowdown: which sectors matter and why?

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