*** ANDRE ORLEAN: L'Empire de la Valeur. Refonder l'économie. Éditions du Seuil (25 Bd. Romain Rolland, F-75014 Paris. Email: commandes@volumen.fr - Internet: http://www.seuil.com ). « La couleur des idées » series. 2011, 343 pp. €23. ISBN 978-2-02-105437-8.
Obviously, the crisis is going to see heaps of different books published that attempt to identify where and why the economies and, to a large extent, Western societies, have gone off the rails. A number of authors have already written reams on the failure of certain economic models and have delivered some extremely sharp criticism of economists and financial actors in this regard. André Orléan provides an original contribution insofar as in this book he explores the lie of the land from an economist's perspective rather than that of a sociologist or historian. His starting point is that the problems confronting economic theory do not in any way emanate from the objective circumstances but are, rather, the consequences of a defective overall design.
The neoclassical approach, which currently holds intellectual sway, posits that there is a” fundamental value” in assets held. Efficiency is proved when market prices equal “real” value, linked to the fundamentals in place and there is only one force at play, namely, the individual who wants something because the thing in question is useful. For the author, currently head of research at the CNRS, economic activity also brings into play collective powers that can dictate what should be done. Orléan considers that currency provides a useful illustration of this paradigm: the desire that it provokes does not at all result from any intrinsic usefulness sought in this entity in itself. Consequently, the author considers that the desire for currency and not the quest for useful products, is the force that really gives life to the entire market mechanism.
André Orléan seeks to understand market value, without attempting to identify any pre-existing power, such as utility, labour or scarcity. In his eyes, the hypothesis of objective financial value does not hold water. The stock markets are institutional creations invented as a response to a specific demand by the lenders and those owning the means of production: transforming their rights into money. They do not intend to reflect the real forces of production. The author highlights the distinction made by Keynes between “speculation”, an activity that involves second-guessing the psychology of the market and “enterprise”, which consists in forecasting the hoped-for yield of the assets in question during their entire existence. The author believes that the disconnect between finance and production and the subsequent speculative bubbles should therefore no longer appear as an irrational accident. The speculator benefits when he successfully and correctly predicts developments in group opinion. Liquidity is not an intrinsic part of the goods traded: it is a result of the market itself. Speculative rationality is the rationale underpinning the demand for liquidity. Therefore, the domination of speculation over enterprise does not in any way result from a psychological propensity. Therefore, when liquidity is obstructed, for example, due to a hike in transaction costs, purchases and sales suffer and become more expensive which makes speculation less profitable and less important, no matter what certain individuals themselves would like to happen. This close relationship between liquidity and speculation prompted Keynes to advocate higher transaction costs, including the introduction of high taxation, so as to weaken the role played by speculation. This is the antithesis of contemporary developments, which seek to reduce transaction costs in an attempt to increase liquidity. André Orléan would like the perspective of substantial value, which unduly impacts on economic relations, to be broken. Value is not found in objects, it is found in collective production that makes collective life as a society possible …
In its history, Europe has already demonstrated its ability to bounce back and reconstruct itself. The European project was originally a project to redevelop the economy. Similarly to Sisyphus, it is necessary to start again. It would be good if André Orléan - or less theoretical commentators - drew on these ideas to practically illustrate what they mean to the citizens affected by them, namely the majority of us, from the small saver to the big financier, without even mentioning the politicians who are supposed to be governing us.
Lieven Taillie
*** MICHAEL A. PETERS: Neoliberalism and After? Education, Social Policy, and the Crisis of Western Capitalism. Peter Lang (1 Moosstrasse, Postfach 350, CH-2542 Pieterlen. Tel: (41-32) 3761717 - fax: 3761727 - Email: info@peterlang.com - Internet: http://www.peterlang.com ). "Global Studies in Education" series, No. 4. 2011, 222 pp. €83.80. ISBN 978-1-4331-1206-5.
At the beginning of his book, Michael Peters explains why he became a philosopher and how he saw it as a way of being able to, “study what I considered to be my interests and my passion rather than a meal-ticket”. He obtained his degree before neoliberalism began to dictate how the education sector would function. The essays contained in this book cover three decades of his career. He is currently teaching education at the University of Illinois but has not ceased to examine neoliberalism as “an intellectual system, ideology and set of policies”. He provides an erudite historic and theoretically detailed investigation, which is naturally very critical, from an intellectual who admits, “I am sympathetic to the neo-Marxist critique of the capitalist system as a whole” of neoliberalism in light of its influence in the field of education (particularly developments in his native country, New Zealand) and the rolling back of the Kensian welfare state. After having taken apart the foundations and impact of this ideological one-way street and, “rethinking education” as a right to the welfare state, the author provides some basic answers to questions of whether neoliberalism will maintain its influence after the financial crisis and global recession, which has affected the most advanced liberal economies, such as the US and the European Unions.
(PBo)
*** SEVERIN J. LEDERHILGER (editors): Gerechtigkeit will ich. Christliche Provokation für die Ökonomie. Peter Lang (see address attached). 2011, 195 pp. €40. ISBN 978-3-631-61080-0.
The negative effects of the financial and economic crisis over a number of years have now provoked a huge debate about the Western economic model. It has been accused of being at the source of the crisis and of being completely incapable of learning the errors of its ways. The financial community is now in the dock due to if behaviour and the way it operated. Now that states have been obliged to intervene to mobilise significant amounts of resources to reduce the risk of several banks and other financial institutions going bust, civil society is obviously calling on the former to moderate the way they operate, so that they act in a more ethical way and that any further crises can be forecast beforehand. Obviously, this debate does not exclusively involve the economic world: several traditions are now gearing up for this change, particularly within the different religious communities. One sign that appears to indicate that things are shifting can be found in the increased activity of so-called “Islamic” finance, with the ethics of Islamic finance directly drawing its source from the Koran.
There is therefore nothing surprising if other religious currents also invite themselves to the debate and put forward their own philosophical and theoretical bases for modern finance. This was the case with several economists from the Christian community, who published a number of different documents in which they advocated a greater ethical underpinning of the financial world based, above all, on the Bible. Following these publications, Severin Lederhilger invited figures from the religious academic community to a conference in Austria at which the theme was Christianity's contribution to finance. Twelve of these contributions have been included in this book by this professor of Biblical Law at the Catholic and Theoretical University of Linz. The first part of the book focuses on “prevailing” ethics in the financial world and the presentation of the Christian alternative, which obviously provides the lightning conductor throughout this book. In this book, the author looks at the relationship between Christian ethics in the economy and the social impact of economic and financial activities. The final contribution illustrates a project that already exists and which involves the church directly intervening in the agricultural domain in Brazil.
(JD)
*** YANN DECORZANT: La Société des Nations et la naissance d'une conception de la régulation économique internationale. Presses Interuniversitaires Européennes / Peter Lang (1 av. Maurice,
B-1050 Brussels. Tel: (41-32) 3761717 - fax: 3761727 - Email: info@peterlang.com
- Internet: http://www.peterlang.com ). "Enjeux internationaux" series, No. 19. 2011, 467 pp. €51.40.
ISBN 978-90-5201-751-8.
This book is an extension of a doctoral thesis in economic and social history written at the University of Geneva (where the author teaches) and Oxford University. It makes a lively defence of the League of Nations, which has often been attacked for having been unable to prevent the Second World War breaking out. Yann Decorzant demonstrates that although it was in the aftermath of this war that (encouraged by the US) the world decided to set up a number of international economic regulatory institutions worthy of the obvious name (the International monetary fund, the World Bank and Gatt etc.), most of the credit should in fact go to those who, during the wake of the First World War, developed the conditions, by setting up the Economic and Financial Organisation, a branch of the League of Nations and the International Labour Organisation. The author even goes back to before the First World War, to look at the roots and pioneers of this first attempt at collective management of the international economy, which went beyond the juxtaposition of the separate national economies. He provides more than a mere description of institutional history and provides the context in which the OEF came about and developed as part of the economic thinking of the 20th century. He also provides a scrupulous examination of international relations in this perspective. He provides an insight into the role played by different individuals, most of whom were recruited from the ranks of government officials and experts who have been active in inter- allied collaborative bodies and who were often at the heart of the action taken by the League of Nations in economic and financial sphere… a certain Jean Monnet being perhaps one of the better-known figures amongst them…
(MT)
*** SOPHIE VON EICHEL: Gläubigerzugriff auf Destinatärrecthe. Peter Lang (see address attached). 2011, 118 pp, € 26. ISBN 978-3-631-61589-8.
This book seeks to shed light on all the different non-profit making associations, charities and philanthropic bodies in Germany. It goes beyond their stated objectives and shows that these legal entities are sometimes able to camouflage structures and methods for avoiding paying tax. The money invested in these organisations is not subject to tax. Therefore, setting up such entities allows rich individuals and families, indeed international companies and groups, to obtain immunity from paying significant amounts of money and subsequently and efficiently avoid paying tax. One of the most often used methods for identifying a genuine charity, as well as evaluate its legitimacy, is to look at whom it is supposed to cater for. Following a brief history on the subject, the first part of the book contains an illustration of the elements that determine whether an entity is indeed a charity under German law. It also provides a typology of the different organisations of this character. Sophie von Eichel then analyses the judicial concept of the beneficiary or beneficiaries of such an organisation and whether these can be included in the defining texts of a charity and in its daily activities. She also analyses the practices of a charitable organisation, with a genuine philanthropic objective, practices, which help to demonstrate that no method of tax evasion is being employed. A number of other national legislations are examined, such as those in Austria, Switzerland and Lichtenstein, as well as a few appropriate cases of jurisprudence in this connection.
(JD)
*** MARGARITA M. KALAMOVA: Essays in International Trade and Public Economics. Peter Lang (see address attached). "Finanzwissenschaftliche Schriften" series, No. 122. 2012, 131 pp. €29.70.
ISBN 978-3-631-62139-4.
This collection of essays written by a Bulgarian economist as part of his university studies in Germany, tackles the relationship between structure and quality of the public sector and the process of economic integration . In the first part of the book, the author examines the impact of government architecture, in particular, the degree and form of government decentralization on trade and foreign direct investment. It then seeks to identify the effect of government's intangible assets on foreign direct investment.
(PBo)
*** ANDREA RENDA: Law and Economics in the RIA World. Improving the use of economic analysis in public policy and legislation. Intersentia Publishers (31 Groenstraat, B-2640 Mortsel. Tel: (32-3) 6801550 - fax: 6587121 - Email: mail@intersentia.be - Internet: http://www.intersentia.com ). "European Studies in Law and Economics", No. 6. 2011, 270 pp. €72, £68, $101. ISBN 978-1-78068-023-1.
Strongly advocated by international organisations such as the OECD and the World Bank, ex ante impact studies of regulation have become the rule in the European Union and US where hundreds of them take place every year. Andrea Renda teaches law and economics at LUISS in Rome. The European Commission recognised her expertise and in this book she begins with an explanation of whence these impact studies originate, how they developed in the US, before being adopted in the European Union. She also looks at the similarities and differences that can be observed on both sides of the Atlantic, in the context of methodology and scope of application for these studies. She illustrates how European civil servants are encouraged to deliver high-quality assessments, notwithstanding the difficulties that this method has encountered when attempting to win acceptance in certain member states. In the second part of the book, Andrea Renda demonstrates, on the basis of eight case studies, how these impact studies cannot in themselves constitute the end of history because there is obvious room for improvement. In this connection, he provides a number of recommendations about how they can be improved.
(PBo)