Posts filed under ‘– Klein –’
Scots, Wha Hae
| Peter Klein |
Today's Wall Street Journal features a front-page profile of a Carnegie-Mellon student majoring in bagpipes, thought to be the only such student in the US. This prompts a confession I've long wanted to make: I'm half Scottish. My mother was born and raised in Freuchie, a tiny village of just north of Edinburgh. While Scottish eccentricities are ripe for satire (ask Monty Python or Mike Myers), we also deserve credit for the steam engine, penicillin, pneumatic tires, the telephone, and the Scottish Enlightenment.
Speaking of the latter, though no one doubts the importance of Smith, Hume, Hutcheson, Ferguson, Steuart, Kames, and the rest, the Scots have been getting a bad rap lately. Murray Rothbard famously and controversially called Adam Smith overrated, describing the late Spanish Scholastics, Cantillon, Turgot, and the Physiocrats as better economists. Gertrude Himmelfarb's recent book The Roads to Modernity distinguishes sharply between Scottish and British achievements. (Hat tip to Nicolai.) Even Hayek, whose interpretation of Scottish thought is extremely influential, takes a drubbing in a recent paper arguing that Polanyi had the better grasp of "spontaneous order." (This paper disagrees.)
Citations and Critical Commentary
| Peter Klein |
Yet more on citations. The May 2006 issue of the always-interesting EconJournalWatch — the economics profession’s own watchdog organization — considers the decline of critical commentary in economics journals. Beginning in the 1970s, most top-tier economics journals stopped publishing comments and replies. Robert Whaples blames the Social Sciences Citation Index: regular articles tend to get more citations per page than comments and replies, so journal editors, wishing to maximize their citation counts and impact factors, prefer regular articles to critical commentary and discussion. (I think the same would apply, a fortiori, to book reviews, though they aren’t mentioned here.) Philip Coelho and James McClure add that journal editors care about not only citations to the journal, but also citations to the journal’s own “insiders” (e.g., editors and editorial board members). They provide empirical evidence that comments and replies rarely cite insiders.
Bottom line: academia’s increasing reliance on bibliometric measures of quality and performance has real effects on the kind of research we do, how we package and promote our research, the demographic characteristics of the research community, and so on. Good or bad? Comments are open.
J. Bruce Bullock (1940-2006)
| Peter Klein |
My friend, colleague, and current department head J. Bruce Bullock collapsed at his home this morning, was taken to a hospital, and died a short time later. Bruce received a PhD in agricultural economics at the University of California at Berkeley in the 1960s but was a Chicago price theorist at heart. Much of his work attempted to debunk standard notions of “market failure” (he despised the term) and inefficiency. He taught for many years at N.C. State University, where he was influenced by the semi-Austrian economist E. C. Pasour, Jr., with whom he coauthored one of his most interesting papers, a critique of neoclassical welfare economics. More recently, Bruce had become interested in entrepreneurship, particularly the teaching of entrepreneurship. (He and I coauthored a short paper on entrepreneurship in the undergraduate curriculum, immodestly titled “Can Entrepreneurship Be Taught?”) Bruce’s most recent position was McQuinn Professor of Entrepreneurial Leadership at the University of Missouri. He will be missed.
Emergence of Modern Business Enterprise in France
| Peter Klein |
My co-blogger has a reputation for poking fun at French intellectuals, so in this blog's spirit of international brotherhood I direct you to an interesting review of Michael Stephen Smith, The Emergence of Modern Business Enterprise in France, 1800-1930 (Harvard University Press, 2005). The review, by Pierre-Cyrille Hautcoeur, appears in the excellent book review series at Eh.Net. The book "'argues that the same forces that were giving rise to a new kind of very large, very complex business organization in the United States, Germany, and Great Britain between 1880 and 1930 were also at work in France,' contrary to the idea of a special or a backward path for French economic development."
Citation Impact of Entrepreneurship Research
| Peter Klein |
For you citation junkies out there ("bibliometricians"? "citophiles"?), the May 2006 issue of Entrepreneurship: Theory and Practice features a symposium on the nature and impact of entrepreneurship research, as measured by citation impact. (The formal title is "Special Issue on Understanding Entrepreneurship Scholarship from a Bibliometric Perspective.") According to the editors, bibliometric analysis suggests that entrepreneurship research contains "multiple but disconnected themes; dominant themes that reflect the disciplinary training and lens of their authors; and considerable dynamism and change in key research themes over time." More, in other words, than a disconnected "potpourri" or "hodgepodge." A fair point, but my sense is that the entreprreneurship literature still has a long way to go before constituting a coherent "field" with a distinct vision, research approach, "paradigm problems," and so on.
Malthus and the “Dismal Science”
| Peter Klein |
I too imagine that Williamson's critics will be delighted by the association with Malthus.
As a footnote, David Levy and Sandra Peart have done interesting revisionist work claiming that Malthus actually wasn't the target of Carlyle's famous quip.
Everyone knows that economics is the dismal science. And almost everyone knows that it was given this description by Thomas Carlyle, who was inspired to coin the phrase by T. R. Malthus's gloomy prediction that population would always grow faster than food, dooming mankind to unending poverty and hardship.
While this story is well-known, it is also wrong, so wrong that it is hard to imagine a story that is farther from the truth. At the most trivial level, Carlyle's target was not Malthus, but economists such as John Stuart Mill, who argued that it was institutions, not race, that explained why some nations were rich and others poor. Carlyle attacked Mill, not for supporting Malthus's predictions about the dire consequences of population growth, but for supporting the emancipation of slaves. It was this fact — that economics assumed that people were basically all the same, and thus all entitled to liberty — that led Carlyle to label economics "the dismal science."
See the full thing here. And take that, economist-bashers!
Happy Hayek-Klein day
| Peter Klein |
Today, May 8, is the birthday of two extraordinary brilliant, prolific, and influential social theorists: F. A. Hayek (born 1899) and, um, me (born sometime after that). Enjoy a piece of cake for Fritz and myself.
(Another Hayek-Klein connection: I once owned a car formerly owned by the philosopher W. W. Bartley, III, for whom I had worked as a research assistant. Bartley had purchased the car in Germany, where he was conducting a series of interviews with Hayek for a planned biography, and later had it shipped to him in California. Hayek himself thus spent a good deal of time in the car’s passenger seat. Naturally, when I owned the car, I told my friends that I was the holder of the “Hayek Chair.”)
Market-Based Management
| Peter Klein |
I first heard the term “market-based management” (MBM) in 1994 or 1995, attatched to the now-defunct Program on Social and Organizational Learning at George Mason University. The theory was described in a few papers (one example here) and, as I recall, a monograph. My impression was that the principles of MBM were unobjectionable, but unremarkable: strong mission, values, and culture statements combined with decentralized decision-making and incentive compensation. The main innovation seemed to be the addition of an “Austrian” gloss (e.g., “Taylorism suffers from a fatal conceit….”).
This weekend’s Wall Street Journal profiles Koch Industries’s Charles Koch, who not only practices market-based management but actually trademarked the term. Writer Stephen Moore notes, somewhat delicately: “Some of the ideas that undergird Market Based Management seem fairly commonsensical to me, and I’m not entirely sold on the notion that this program somehow represents a seismic breakaway from what is taught at Harvard Business School.” Indeed, the idea that organizations can sometimes exploit “market-like incentives” would hardly surprise Chester Barnard, Alfred Chandler, or Oliver Williamson, let alone Alfred P. Sloan.
A more fundamental problem is that while decentralization provides benefits (more effective use of specific knowledge, conservation of central managers’ time, and so on) it also brings costs (agency problems, rent-seeking, coordination failure, etc.). To my knowledge the MBM literature has yet to identify or analyze the relevant tradeoffs. Jensen and Meckling’s (underappreciated) 1992 paper represents one attempt to grapple with these problems; this recent Foss-Foss-Klein paper suggests a slightly different approach. In short, all organizations represent a blend of market and hierarchy. The trick is to find the appropriate mix. Simply describing the virtues of “market” doesn’t get us very far.
Among the Euro-weenies
| Peter Klein |
Europeans are ignorant and stupid, says Wisconsin Law Professor Gordon Smith. (He's actually making a serious point, at least in one of his posts.) Consistent with this blog's spirit of international cooperation, I hasten to add that I neither approve nor condemn such sentiments.
(Apologies to P.J. O'Rourke for stealing his title.)
Further Thoughts on Economic Calculation
| Peter Klein |
Nicolai asks important questions about the Austrian critique of socialism. I agree that a fresh look at these issues is warranted. My $0.02:
1. Mises's understanding of economic calculation is not exclusively, or even primarily, related to socialism. It is part of Mises's general explanation of how an advanced economy — i.e., an economy with a complex structure of heterogeneous capital goods — allocates resources to their highest-valued uses.
2. Mises's work on socialism flowed from his work on money. (It’s no coincidence that the 1920 article on calculation followed the 1912 book Theory of Money and Credit.) Entrepreneurs need actual numbers, not ratios of marginal utilities, to perform cost accounting. In a non-monetary economy there can be no "calculation," which for Mises means the comparison of anticipated future receipts and present expenditures on factors.
3. The key to all this, for Mises, is his concept of the "plain state of rest" (PSR). (more…)
Mises on econometricians
| Peter Klein |
Nicolai and I share a great admiration for the Austrian economist Ludwig von Mises, whom we consider one of the towering intellects of the twentieth century. A vast collection of Mises’s published and unpublished writings is already available online. The newest addition to this collection is a set of brief notes on research topics suggested by Mises to participants in his graduate seminar at New York University during the 1950s and 1960s. The notes were carefully recorded by his students Percy and Bettina Bien Greaves.
I haven’t had a chance to read through the set carefully, but a few gems stand out, such as this one from 1956: “We need a book to stop the econometricians or we will have more econometricians than those in useful occupations.”
Update: the notes are now available in plain text.
Jane Jacobs and Economies of Diversity
| Peter Klein |
American-born Canadian writer and activist Jane Jacobs, author of The Death and Life of Great American Cities (1961), Cities and the Wealth of Nations (1984), and other important works on urban issues, died last week at age 89. (Jacobs never held a university post, and the obituary writers weren't sure what to call her; the Toronto Star chose "urban philosopher," suggesting to younger readers a hip-hop artist or tagger.) Lynne Kiesling at Knowledge Problem summarizes some of the Jacobs commentary around the web. (See also this from Gene Callahan and Sandy Ikeda and this from Leonard Gilroy.)
My interest in Jacobs's work stems, in part, from a current project on the economics of clustering in agro-biotechnology. My reading of the economic geography literature suggests that it tends to overstate the advantages of localization (proximity to key suppliers or buyers, access to specialized, tacit knowledge from similar firms, etc.) while downplaying the importance of economies of urbanization or diversity, an equally important kind of agglomeration. Readers, please correct me if this impression is wrong.
Besides classic works on economies of urbanization by Jacobs, Rosenberg (1963), and Henderson (1988), I like this paper by Pierre Desrochers, and this one by Desrochers and Frederic Sautet.
New Foss-Foss-Klein working paper
| Peter Klein |
A new item has just been added to our working papers page, “Original and Derived Judgment: An Entrepreneurial Theory of Economic Organization,” by Kirsten Foss, Nicolai J. Foss, and Peter G. Klein. This is an early draft, and comments are most welcome. Here’s the abstract: (more…)
orgtheory.net
| Peter Klein |
Our initial post below noted the dearth of good management blogs. A happy exception is orgtheory.net, written by Brayden King and Teppo Felin, both of Brigham Young University. (King teaches sociology, while Felin teaches organizational leadership and strategy at the Marriott School.) Their masthead promises coverage of "all things organizational," and they deliver so far, writing on organization theory, strategy, human resource management, scientific method, and more. We look forward to learning from them as we populate the blogosphere together.
Professors Are From Mars, Students From Venus
| Peter Klein |
My department recently hosted a workshop at which faculty and undergraduate students could exchange suggestions for improving the classroom experience. Many of the students' requests were reasonable ("start and end class on time"; "give regular feedback on student performance"; "don't assign readings that won't be used"), some weren't ("realize that we get bored easily and need to be entertained"). Faculty requested things like "come to class prepared"; "take advantage of office hours"; and "put care into your writing and speaking."
My favorite faculty comment, however, was this: "Please don't send me email saying, 'I won't be in class Tuesday; will I miss anything?'"
Journal of Institutional Economics
| Peter Klein |
Geoff Hogdson's Journal of Institutional Economics has released its second issue (April 2006). Articles that look particularly interesting include "The turn in economics: neoclassical dominance to mainstream pluralism?" by John B. Davis and "The rhetoric of Oliver Williamson's transaction cost economics" by Huascar F. Pessali. The issue also includes a 1929 essay by Werner Sombart. (I realize publication lags in economics are getting longer and longer, but this is ridiculous!)
A Lachmanian Approach to Entrepreneurship
| Peter Klein |
My colleagues Todd Chiles, Allen Bluedorn, and Vishal Gupta have posted an updated version of their forthcoming Organization Studies paper, "Beyond Creative Destruction and Entrepreneurial Discovery: A Radical Austrian Approach to Entrepreneurship." The paper introduces entrepreneurship scholars to the idiosyncratic Austrian economist Ludwig Lachmann, presenting Lachmann's approach as an alternative to those of Schumpeter and Kirzner.
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