THE NEW PALGRAVE DICTIONARY of ECONOMICS SECOND EDITION the NEW PALGRAVE DICTIONARY of ECONOMICS SECOND EDITION Edited by Steven N

THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

Volume 1 Abramovitz- collusion

palgrave macmillan © Macmillan Publishers Ltd. 2008 Softcover reprint of the hardcover 2nd edition 2008978-0-333-78676-5

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1. Economics - Dictionaries. I. Durlauf, Steven N. II. Blume, Lawrence. III. New Palgrave.

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Typesetting and XML coding by Macmillan Publishing Solutions, Bangalore, India Contents

Publishing history vi

Editorial advisory board Vll

Associate editors Vlll

Preface ix

Preface to the First Edition of The New Palgrave: A Dictionary of Economics xi

Introduction to the First Edition of the Dictionary of Political Economy Xlll

List of entries A-Z XV

The dictionary, volume 1

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis Palgrave, in three volumes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2nd edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi Editorial advisory board

Kenneth Arrow, Emeritus Professor of Economics, Stanford University, USA

Sir Tony Atkinson, Professor of Economics, Nuffield College, University of Oxford, UK

Richard Blundell, Professor of Economics, University College London, UK

William Brock, Vilas Research Professor of Economics, University of Wisconsin, Madison, USA

Sir Partha Dasgupta, Professor of Economics, University of Cambridge, UK

Peter Diamond, Institute Professor, Massachusetts Institute of Technology, USA

Roger Guesnerie, Delta, PARIS-Jourdan, France

James J. Heckman, Henry Schultz Distinguished Service Professor of Economics, University of Chicago, USA

Elhanan Helpman, Galen L. Stone Professor of International Trade, Harvard University, USA

Takatoshi Ito, Professor of Economics, University of Tokyo, Japan

Andreu Mas-Colell, Societat de la Informaci6/Universitat Pompeu Fabra, Spain

Peter Phillips, Sterling Professor of Economics and Professor of Statistics, Yale University, USA

Thomas Sargent, Senior Fellow, Hoover Institution and W.R. Berkeley Professor, New York University, USA

Peter Temin, Economics Professor, Massachusetts Institute of Technology, USA

vii Associate editors

Roger Backhouse, University of Birmingham, UK

Mark Bils, University of Rochester, USA

Moshe Buchinsky, University of California, Los Angeles, USA

Gregory Clark, University of California, Davis, USA

Catherine Eckel, University of Texas at Dallas, USA

Marcel Fafchamps, Oxford University, UK

David Genesove, Hebrew University of Jerusalem, Israel

James Hines, University of Michigan, USA

Barry Ickes, Pennsylvania State University, USA

Yannis M. Ioannides, Tufts University, USA

Eckhard Janeba, University of Mannheim, Germany

Shelly Lundberg, University of Washington, USA

John Nachbar, Washington University (StLouis), USA

Lee Ohanian, University of California, Los Angeles, USA

Joon Park, Texas A&M University, USA

John Karl Scholz, University of Wisconsin, Madison, USA

Christopher Taber, University of Wisconsin, Madison, USA

Bruce Weinberg, Ohio State University, USA

viii Preface

The second edition of The New Palgrave: A Dictionary equally on what those methods have found. It places of Economics shares R.H. Inglis Palgrave's original goal, more emphasis on empirical work than have any of its ' ... to provide the student with such assistance as may predecessors, reflecting the significant empirical enable him to understand the position of economic advances that have occurred in the microeconomic thought at the present time'. That goal was certainly fields in particular. But a static snapshot could not within reach (and achieved) in Palgrave's time and pretend to be contemporary for long. Our publishers that of his successor, Henry Higgs. Some 60 years have recognized not just the magnitude of the change later it was a much more daunting achievement in the stock of knowledge between the last edition and for John Eatwell, Murray Milgate and Peter Newman, the present, but also the increased growth rate of the editors of The New Palgrave: A Dictionary of economics' intellectual capital. They have made the Economics. A mere 21 years later, the task is nearly Dictionary dynamic. With this edition, The New insuperable. When Eatwell, Milgate and Newman Palgrave Dictionary of Economics moves online, with began commissioning entries for their Dictionary in the expectation of regular updates to keep the 1983, the IBM PC with 16K of ram was two years old. Dictionary current in 'real time'. Econometrics was still largely the estimation of linear It is no longer possible to produce a reference work models on mainframe computers. Sequential equili that aspires to be comprehensive on the small editorial brium had been formally introduced to the profession scale of the lone Palgrave or the Eatwell-Milgate only the year before, and the Bayesian revolution, Newman trio. The present edition has benefitted from indeed the modern revival of game theory, had just two editorial boards. We were pleased to have access to begun. Economists and psychologists had already been a board of advisory editors, many of whose members' talking for some time, but the field of behavioral work has defined the methodological and subject economics was still in gestation. Only a few farsighted matter transformation of the last 20 years. A board of economists saw anything more to sociology than area editors took on the responsibility of constructing James Duesenberry's famous quip, that 'Economics is large parts of the Dictionary, choosing topics, all about how people make choices; sociology is all commissioning writers and editing the entries. This about how they don't have any choices to make.'' edition simply could not have been produced without Since the appearance of the The New Palgrave: A their expertise and efforts. By any measure of sweat Dictionary of Economics in 1987, the discipline of equity, they own much of this book. economics has grown enormously both in analytical This edition of the Dictionary has come to print and technical sophistication and in the scope of the only through the efforts of people too numerous to subject. properly acknowledge, but some names must be The growth of economics is reflected in the celebrated. In particular, we cannot thank enough expansion of the Dictionary. This edition has grown Ruth Lefevre in London and Susan Nelson in to eight volumes from the four of its predecessor, Madison, who organized every nut and bolt of this although many entries from the previous edition were project, and kept track of manuscripts on five either removed or electronically archived. Further continents. Economists do not write as well as our more, the Dictionary has shed much of its historical Dictionary entries suggest. Every author benefitted character: from providing a record of the development from superb copy-editing by Michael James and of economic thought, it has become more a snapshot Elizabeth Stone. Finally, it is the job of the editors of contemporary economics. Whereas the first edition to keep the writers in line; it was the job of Alison emphasized economic method, this edition reports Jones to keep the editors in line. We deeply appreciate both the velvet glove and the iron fist it encloses. The huge effort required to bring this edition to 'Comment in Demographic and Economic Change in Deve print is compensated for by the opportunity to have loped Countries, ed. Universities-National Bureau Committee for contemporary economics laid out before us. What joy Economic Research. Princeton: Princeton University Press, 1960. to have the ability to commission an explanation by ix x Preface any expert of anything we wanted to know. But even well. More than just a subject matter, economics is a this is second-order to our discovery of the warmth community of scholars, of which we are proud to be a and generosity of the community in which we work. part. We are deeply appreciative of the support we have received from our colleagues; those who wrote for the Dictionary, those who helped us sort out editorial Steven Durlauf and Lawrence Blume issues, and those who just stepped forward to wish us February 2008 Preface to the First Edition of The New Palgrave: A Dictionary of Economics

In the preface to the first volume of his Dictionary of English, especially in Britain itself, and a substantial Political Economy (1894), R.H. Inglis Palgrave said that treatment of major economists who have written in its 'primary object... is to provide the student with other languages. Palgrave, perhaps hoodwinked by such assistance as may enable him to understand the his contributor C.P. Sanger, chose only Walras from position of economic thought at the present time'. economists living at that time, on the distinctly odd Although appearing almost a century later, when ground that 'he so closely carried on the work of his economics has changed and grown beyond anything father Prof. Antoine Walras that it was not possible to imagined in his time, still much the same claim can be mention the latter without also describing the works made for The New Palgrave. of his son'. We however have included a substantial In order to accommodate this growth, much that number of living economists, arguing that economics interested Inglis Palgrave has been jettisoned. Such has grown so much in this century that not to include topics as the administration of public exchequers, many of its most eminent living practitioners would foreign coinage, land tenure systems, legal and business seriously limit the usefulness and scope of the work. terms, social institutions, and many others, are all of To reduce obvious problems of evaluation we imposed interest but are, as Henry Higgs said in his preface to a cut-off date: a necessary condition for inclusion is to the second edition of the Dictionary, 'only remotely have reached the age of seventy before 1 January 1986. connected with economics. Their place has been taken On many non-biographical subjects, large and by whole disciplines unknown to the original editor small, we have tried to capture diversity and vivacity (econometrics, game theory, Keynesian economics, of view by having multiple entries, under similar but optimization theory, risk and uncertainty and its different titles. In this way we hoped to obtain essays application, social choice theory, urban economics), that present the results and methods of research with as well as by vast expansions of subjects which were fairness and accuracy, but not necessarily from a in their infancy in his time (business cycle theory, 'balanced' point of view. Such a view in these cases general equilibrium theory, growth theory, industrial should be sought externally, as it were, using the organization, labour economics, welfare economics). system of cross-references to consult other relevant There is so little remaining here of the original entries. This means more work for the reader but Dictionary that it would be disingenuous to call this its should yield correspondingly greater reward. third edition. But just as the editor of The New Grove There is obviously a rough and ready correlation 'tried to ensure that something of the fine humane between size of entry and the importance which the traditions of the earlier editions of Grove are to be seen editors attach to the person or subject concerned, but in our pages', so we would like to believe that The New the correlation is very far from perfect. The actual Palgrave has retained some of the liberal and scholarly realization of the project did not always turn out in spirit of Palgrave's enterprise. At least it is like its accord with our original plans. And fortunately so, for predecessor in dealing with economics mainly in its we learned a great deal in the process of editing and as theoretical and applied aspects rather than in a consequence made continual revisions of those descriptive and institutional detail. The latter becomes plans. Such adjustments have made for a better outdated within a very few years, depreciating too product, but not for one that displays perfect rapidly for a publication meant for a longer shelf life consistency. In this regard there can be no reader than that. who will not wish that the Dictionary were different in Although it is not intended to contain a directory of some respects, a lot more here, rather less there, that economists, over 700 of the nearly 2000 entries in The tired or tiresome topic omitted, that important New Palgrave are in fact biographical. We have aimed omission made good. While it is unrealistic to expect at reasonably complete coverage of the more impor that all such errors of omission and commission can tant economists who have written primarily in be avoided, our hope is that the reader will find that

xi xii Preface to the First Edition of The New Polgrove: A Dictionary of Economics those which remain are unbiased, in almost every enthusiasm and attention to detail contributed essen sense of the word. tially to the timely completion of the work. It is also There is, however, one major bias. We wanted not only simple justice to acknowledge, with gratitude, how only to provide a thorough account of contemporary much we have depended on the assistance of Ann economic thought but also, like Palgrave himself, to Lesley in Cambridge and Donna Hall at Johns Hopkins, have it set in historical perspective. So we asked always cheerfully given and expertly rendered. authors to write accordingly, discussing for any Editing this Dictionary has left us with a very strong particular subject its past and its prospects for the sense, quite contrary to the layman's accepted view, of future, as well as its problems of the moment. Some the solidarity of economics as a profession. This has topics are naturally more apt for this approach than been shown in many ways, not least by the extremely others, and some contributors were of course more in favourable response to our invitations to contribute, sympathy with our aims than others. In the main, which were extended to economists of widely varying however, they responded very well indeed to our ideological and methodological persuasions. Over request, in some cases remarkably so. eighty per cent of those whom we asked agreed to Palgrave was the sole editor of his Dictionary, a write, and almost all of those who declined did so with labour of love for his subject over many years. Several words of regret and encouragement. Looking back, the of his authors did more than just write for him, hard work of editing subsides into the background, however, by suggesting entries and contributors and by overwhelmed by the sheer enjoyment of putting it all helping the work through the press. We have tried to together, by the continued pleasure of managing the preserve Palgrave's small editorial scale, but like him flow of usually good and sometimes superlative copy could not have done so without the generous and from nearly a thousand authors. We hope that the friendly help (far more than could be reasonably reader will experience most of this enjoyment, and less expected) of very many contributors, so many indeed of the work. that it would be invidious to acknowledge them all by name. We must however recognize the key part played John Eatwell, Murray Milgate, Peter Newman by Margot Levy, the publishers' managing editor, whose January 1987 Introduction to the First Edition of the Dictionary of Political Economy

The primary object of the Dictionary of Political deeply coloured by the soil of the fields through which Economy is to provide the student with such assistance it has flowed by the varied strata of the cliffs - some of as may enable him to understand the position of them undermined by it - that have bounded its long economic thought at the present time, and to pursue and devious course. such branches of inquiry as may be necessary for that Considerations of space have necessarily confined end. the scope of the work mainly to the developments of The table of the contents of the work shows how economic study in England, the United States, and large is the range of investigation which the student our English-speaking colonies - and, in regard to must follow at the present time. these, an endeavour has been made to present under During recent years the course of economic study all the subjects treated an account of the best and most has extended so widely that it was obviously recent authorities; whilst the opinions held in other impossible to restrict the work to the old and formerly countries have also, as far as the required limits well-recognized boundaries. The development of the allowed, been considered and mentioned. historical school has opened out new and fertile fields, The biographies introduced have been selected with while the wants of those who follow the mathematical the same end. They show what has actually been method of study have also to be considered. These two written in former times, and hence will enable the main lines of treatment are here but mentioned as reader to trace the progress of economic thought. examples. They are far from exhausting the countless Much attention has been given to the less-known ramifications of inquiry now rightly thought necessary writers. It is difficult for the student under ordinary for the complete investigation of a study bounded circumstances to trace out when such authors lived, only by the requirements of human life in every social the surroundings which influenced their lives, and the relation. opinions they held. While the oversights in science are In making the selection necessitated by the limits of sometimes as remarkable as the discoveries, these space, the requirements of different classes of students earlier labourers have not unfrequently been the have throughout been borne in mind. On the one side precursors of other and better-known men, and have purely business matters, such as banking, the foreign sometimes anticipated opinions that have held sway exchanges, and the operations of the mint come in; on for long periods after them. the other, subjects of a philosophical character have The different economic schools in the principal been dealt with, such as questions of ethics and countries of the world are also described. Thus this methods of definition, analysis, and reasoning; - and volume contains notices of the American, Austrian, the ways in which diagrams and mathematical Dutch and English schools, and the French, German, processes may lend assistance to economic inquiry Italian, and Spanish schools will follow in due course. have also been discussed. Again those interested in A work extending over so wide a range of subjects is, historical studies require an explanation of words necessarily, the production of many minds, of writers found in early works, and those derived from classical whose pursuits, occupations, and studies are very and mediaeval times; also of legal phrases, now diverse and varied. I desire to record my warm archaic, together with the modem correlative terms, thanks to the contributors to the book, which is, I for only thus can it be understood how ancient usage think, in itself an almost unique example of economic has influenced present habit. Life in the present day, co-operation. Where all have assisted so heartily, it is even in the most modern settlements in the United less easy to select individual names; but I wish to be States, in our British colonies, in the new countries allowed to express my special thanks to Professor coming into existence in different parts of the world, Dunbar, Dr. Keynes, Professor Marshall, Professor is influenced largely by the past. The stream of Montague, Professor Nicholson, Signor M. Pantaleoni, existence, if the simile may be permitted, reaches us Mr. L.R. Phelps, Mr. L.L. Price, Mr. E. Schuster,

xiii xiv lntrodudion to the First Edition of the Dictionary of Political Economy

Professor H. Sidgwick, and General Walker for This is but an act of justice, that readers may know valuable assistance in different directions, and parti to whom they are specially indebted. cularly to Dr. Bonar, Professor Edgeworth, Mr. Henry Higgs, and Mr. H.R. Tedder, who have kindly helped in R.H. Inglis Palgrave the more arduous labour of the preparation of the Belton, near Great Yarmouth work for the press. Christmas 1893 List of entries A-Z

Abramovitz, Moses (1912-2000) Aquinas, StThomas (1225-1274) Barton, John (1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic (1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas ( 1730-c1792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas (1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of (1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation (econometrics) asymmetric information behavioural genetics aggregation (production) Attwood, Thomas (1783-1856) behavioural public economics aggregation (theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram (1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy (1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram (1914-2003) agricultural research Aumann, Robert J. (born 1930) Serle, Adolf Augustus, Jr. (1895-1971) agriculture and economic development Aupetit, Albert (1876-1943) Bermker, German (1883-1965) airline industry Auspitz, Rudolf (1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao (1952-1997) Australasia, economics in Bernstein, Eduard (1850-1932) Akerlof, George Arthur (born 1940) Austrian economics Bertrand competition Albert the Great, Saint Albertus Averch-Johnson effect Bertrand, Joseph Louis Fran~ois Magnus (c.1200-1280) Ayres, Clarence Edwin (1891-1972) (1822-1900) alienation Bachelier, Louis (1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter (1826-1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas (1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul (1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) (1876-1961) American Economic Association bandit problems bimetallism American exceptionalism Bank of England Black, Duncan (1908-1991) amortization banking crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe ( 1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Bohm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre le Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot (1958-2000) (1645-1714) antidumping Baran, Paul Alexander (1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas (1637/40-?1698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico (1859-1924) bootstrap Antonelli, Giovanni Battista (1858-1944) barriers to entry Borch, Karl H. (1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de (1733-1799) models (linear methods) barter in transition border effects

XV xvi List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur Lyon (1869-1957) central limit theorems common knowledge Boyd, Walter (1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braude!, Fernand (1902-1985) Ceva, Giovanni (1647/48-1734) comparative advantage Braverman, Harry (1920-1976) Chalmers, Thomas (1780-1847) comparative statics Brentano, Lujo (Ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916-1989) Chevalier, Michel (1806-1879) developments) Bruno, Michael (1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Bucher, Karl Wilhelm (1847-1930) Child, Josiah (1630-1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnet de, Abbe de Bukharin, Nikolai lvanovitch Chinese economic reforms Mureau (1714-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905-1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Fran~ois (cl750-1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) diometrics consumption sets capital asset pricing model dubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Cease, Ronald Harry (born 1910) contestable markets capital gains taxation Cease theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard ( 1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) (1855-1921) conventionalism Carlyle, Thomas (1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866-1944) collective action convexity caste system collective action (new perspectives) convict labour catallactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill (1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z xvii

gravity equation Hicks, John Richard (1904-1989) inflation expectations gravity models Hicks, Ursula Kathleen (1896-1985) inflation measurement Great Depression Hicksian and Marshallian demands inflation targeting Great Depression (mechanisms) hierarchical Bayes models informal economy Great Depression, monetary and hierarchy information aggregation and prices financial forces in Hildebrand, Bruno (1812-1878) information cascade experiments Great Divide Hilferding, Rudolf (1877-1941) information cascades green national accounting Hill, Polly (1914-2005) information sharing among firms Gresham, Thomas (cl519-1579} Hirshleifer, Jack (1926-2005) information technology and the world Gresham's Law historical demography economy Griliches, Zvi (1930-1999) historical economics, British Ingram, John Kells (1823-1907) gross substitutes Historical School. German inheritance and bequests Grossman, Herschel I. (1939-2004) history of economic thought Innis, Harold Adams (1894-1952) Grotius (de Groot), Hugo (1583-1645) Hobson, John Atkinson (1858-1940) input-output analysis group selection hold-up problem inside and outside money growth accounting home production insider trading growth and civil war homogeneous and homothetic institutional economics growth and cycles functions institutional trap growth and inequality (macro horizontal and vertical equity institutionalism, old perspectives) Hotelling, Harold (1895-1973) instrumentalism and operationalism growth and institutions hours worked (long-run trends) instrumental variables growth and international trade household portfolios insurance mathematics growth and learning-by-doing household production and public intangible capital growth models, multisector goods integrability of demand growth take-offs household surveys intellectual property Haavelmo, Trygve (1911-1999) housing policy in the United States intellectual property, history of Habakkuk, John Hrothgar (1915-2002) housing supply interacting agents in finance Haberler, Gottfried (1900-1995) human capital interdependent preferences habit persistence human capital, fertility and growth interest rates Hadley, Arthur Twining (1856-1930) Hume, David (1711-1776) intergenerational income mobility Hagen, Everett Einar (1906-1993) hunters, gatherers, cities and evolution intergenerational transmission Hamilton, Alexander (1755-1804) hunting and gathering economies intergovernmental grants Hamiltonians Hutcheson, Francis (1694-1746) internal economies Hannan, Edward J. (1921-1994) hyperinflation internal migration Hansen, Alvin (1887-1975) ideal output internal rate of return happiness, economics of identification international capital flows Harris, Seymour Edwin (1897-1975) identity international economics, history of Harris-Todaro hypothesis immigration and the city international finance Harrod, Roy Forbes (1900-1978) immiserizing growth international financial institutions (IFis) Harsanyi, John C. ( 1920-2000) implicit contracts international migration Hart, Albert Gailord (1909-1997) impulse response function International Monetary Fund Hawkins-Simon conditions imputation international monetary institutions Hawley, Frederick Barnard (1843-1929) incentive compatibility international outsourcing Hawtrey, Ralph George (1879-1975) income mobility international policy coordination Hayek, Friedrich August von income taxation and optimal policies international real business cycles (1899-1992) incomplete contracts international reserves hazardous waste, economics of incomplete markets international trade, empirical health economics indentured servitude approaches to health insurance, economics of index numbers international trade and heterogeneous health outcomes (economic India, economics in firms determinants) indicative planning international trade theory Heckman, James (born 1944) indirect inference Internet, economics of the Heckscher, Eli Filip (1879-1952) indirect utility function interpersonal utility comparisons Heckscher-Ohlin trade theory individual learning in games interpersonal utility comparisons (new hedging individual retirement accounts developments) hedonic prices individualism versus holism intertemporal choice Heilbroner, Robert L. (1919-2005) indivisibilities intertemporal equilibrium and Heller, Walter Perrin (1942-2001) industrial relations efficiency Heller, Walter Wolfgang (1915-1987) Industrial Revolution intrahousehold welfare Hennipman, Pieter (1911-1994) inequality between nations inventory investment Hermann, Friedrich Benedict Wilhelm inequality (global) investment decision criteria von (1795-1868) inequality (international evidence) investment (neoclassical) Herskovits, Melville Jean (1895-1963) inequality (measurement) invisible hand heterodox economics infant-industry protection involuntary unemployment heteroskedasticity and autocorrelation inflation Ireland, economics in corrections inflation dynamics iron law of wages xx List of entries A-Z irreversible investment labour economics (new perspectives) life cycle hypothesis Islamic economic institutions labour-managed firms life tables IS-LM labour market discrimination limit pricing IS-LM in modern macro labour market institutions Lindahl equilibrium lsnard, Achylle Nicolas (1749-1803) labour market search Lindahl, Erik Robert (1891-1960) Italy, economics in labour supply linear models Jaffe, William (1898-1980) labour surplus economies linear programming Japan, economics in labour theory of value linkages Jaszi, George (1915-1992) labour's share of income Lintner, John Virgil (1916-1983) J-curve Laffer curve liquidity constraints Jenkin, Henry Charles Fleeming Laffont, Jean-Jacques (1947-2004) liquidity effects, models of (1833-1885) Lagrange multipliers liquidity preference Jevons, William Stanley (1835---1882) laissez-faire, economists and liquidity trap Jewkes, John (1902-1988) Lancaster, Kelvin John (1924-1999) List, Friedrich (1789-1846) Jim Crow South land markets litigation, economics of Johansen, Leif (1930-1982) land tax Lloyd, William Forster (1794-1852) Johnson, Alvin Saunders (1874-1971) Landry, Adolphe (1874-1956) loanable funds Johnson, D. Gale (1917-2003) Lange, Oskar Ryszard (1904-1965) local public finance Johnson, Harry Gordon (1923-1977) Lardner, Dionysius (1793-1859) local regression models Johnson, William Ernest (1858-1931) large economies location theory Jones, Richard (1790-1855) large games (structural robustness) logit models of individual choice Joplin, Thomas (c. 1790-1847) Laspeyres, Ernst Louis Etienne lognormal distribution Juglar, Clement (1819-1905) (1834-1913) long memory models just price Lassalle, Ferdinand (1825---1864) long run and short run Justi, Johannn Heinrich Gottlob Von Lauderdale, Eighth Earl of [James Longfield, Mountifort (1802-1884) (1720-1771) Maitland] (1759-1839) longitudinal data analysis justice Laughlin, James Laurence (1850-1933) Lorenz curve justice (new perspectives) Launhardt, Carl Friedrich Wilhelm Losch, August (1906-1945) Kahn, Richard Ferdinand (1905---1989) (1832-1918) Lowe, Adolph (1893-1995) Kahneman, Daniel (born 1934) law of demand low-income housing policy Kain, John Forest (1935-2003) law, economic analysis of Lucas, Robert (born 1937) Kaldor, Nicholas (1908-1986) law of indifference Lucas critique Kalecki, Michal (1899-1970) Law, John (1671-1729) lump sum taxes Kalman and particle filtering law(s) of large numbers Lundberg, Erik Filip (1907-1987) Kantorovich, Leonid Vitalievich law, public enforcement of Lyapunov functions (1912-1986) layoffs machinery question Katona, George (1901-1981) Le Chatelier principle Machlup, Fritz (1902-1983) Kautsky, Karl (1854-1938) Le Trosne, Guillaume Fran~ois Macleod, Henry Dunning (1821-1902) kernel estimators in econometrics (1728-1780) macroeconomic effects of international Keynes, John Maynard (1883-1946) learning and evolution in games: trade Keynes, John Maynard (new adaptive heuristics macroeconomic forecasting perspectives) learning and evolution in games: an macroeconomics, origins and history of Keynes, John Neville (1852-1949) overview Maddala, G. S. (1933-1999) Keynesian revolution learning and evolution in games: belief Mahalanobis, Prasanta Chandra Keynesianism learning {1893-1972) Kindleberger, Charles P. (1910-2003) learning and evolution in games: ESS Makower, Helen (1910-1998) King, Gregory (1648-1712) learning and information aggregation Malthus, Thomas Robert (1766-1834) kinked demand curve in networks Malthusian economy Kitchin, Joseph (1861-1932) learning-by-doing Malynes, Gerard de (fl. 1586-1623) Klein, Lawrence R. (born 1920) learning in macroeconomics Manchester School Knapp, Georg Friedrich (1842-1926) Lederer, Emil (1882-1939) mandated employer provision of Knies, Karl Gustav Adolf (1821-1898) leisure employee benefits Knight, Frank Hyneman (1885-1962) leisure class Mandel, Ernest (1923-1995) Kondratieff cycles Lenin, Vladimir llyich [Uiyanov] Mandeville, Bernard (1670-1733) Kondratieff, Nikolai Dmitrievich (1870-1924) Mangoldt, Hans Karl Emil von (1892-1938) Leontief paradox (1824-1868) Koopmans, Tjalling Charles (1910-1985) Leontief, Wassily (1906-1999) Maoist economics Korea, economics in Lerner, Abba Ptachya (1905---1982) Marcet, Jane Haldimand (1769-1858) Kravis, Irving B. (1916-1992) Leroy-Beaulieu, Pierre-Paul (1843-1916) Marget, Arthur William {1899-1962) Kuznets, Simon (1901-1985) level accounting marginal and average cost pricing Kuznets swings Lewis, W. Arthur (1915---1991) marginal productivity theory Kydland, Finn Erling (1943-) lexicographic orderings marginal revolution Kyr~ Hazel (1886-1957) liability for accidents marginal utility of money laboratory financial markets liberalism and economics market competition and selection labour discipline libertarianism market failure labour economics Lieben, Richard (1842-1919) market institutions List of entries A-Z xxi

market microstructure methodological individualism music markets, economics of market period methodology of economics Muth, John F. (1930-2005) marketplaces Metzler, lloyd Appleton (1913-1980) Myrdal, Gunnar (1898-1987) market power and collusion in micro-credit Nash, John Forbes (born 1928) laboratory markets microfoundations Nash equilibrium, refinements of market price Mill, James (1773-1836) Nash program market structure Mill, John Stuart (1806--1873) national accounting, history of marketing boards Miller, Merton (1923-2000) National Bureau of Economic Research markets Minard, Charles Joseph (1781-1870) national income Markov chain Monte Carlo methods Mincer, Jacob (1922-2006) national system Markov equilibria in macroeconomics minimum wages natural and warranted rates of Markov processes Mirrlees, James (born 1936) growth Markowitz, Harry Max (born 1927) Mises, ludwig Edler von (1881-1973) natural experiments and quasi-natural marriage and divorce Misselden, Edward (fl. 1608-1654) experiments marriage markets Mitchell, Wesley Clair (1874-1948) natural price Marschak, Jacob (1898-1977) mixed strategy equilibrium natural rate and market rate of interest Marshall, Alfred (1842-1924) mixture models natural rate of unemployment Marshall, Mary Paley (1850-1944) model averaging Navier, louis Marie Henri (1785-1836) Marshaii-Lerner condition model selection neighbours and neighbourhoods Martineau, Harriet (1802-1876) model uncertainty Nemchinov, Vasily Sergeevich martingales models (1894-1964) Marx, Karl Heinrich (1818-1883) Modigliani, Franco (1918-2003) 'neoclassical' Marxian transformation problem Modigliani-Miller theorem neoclassical growth theory Marxian value analysis monetarism neoclassical growth theory (new Marx's analysis of capitalist production monetary aggregation perspectives) Mason, Edward Sagendorph monetary approach to the balance of neoclassical synthesis (1899-1992) payments neo-Ricardian economics Masse, Pierre (1898-1987) monetary business cycle models (sticky network formation matching prices and wages) network goods (empirical studies) matching and market design monetary business cycles (imperfect network goods (theory) matching estimators information) neuroeconomics material balances monetary cranks neutral taxation mathematical economics monetary E!Conomics, history of neutrality of money mathematical methods in political monetary and fiscal policy overview new classical macroeconomics economy monetary overhang New Deal mathematics and economics monetary policy new economic geography mathematics of networks monetary policy, history of new institutional economics maximum likelihood monetary policy rules new Keynesian macroeconomics maximum score methods monetary transmission mechanism new open economy macroeconomics Mazzola, Ugo (1863-1899) money Newcomb, Simon (1835-1909) McCulloch, John Ramsay (1789-1864) money, classical theory of Nikaido, Hukukane (1923-2001) McFadden, Daniel (born 1937) money and general equilibrium noise traders Meade, James Edward (1907-1995) money illusion nominal exchange rates meaningfulness and invariance money supply non-clearing markets in general Means, Gardiner Coit (1896-1988) moneylenders in developing countries equilibrium mean-variance analysis monocentric versus polycentric models non-cooperative games (equilibrium measure theory in urban economics existence) measurement monopolistic competition non-expected utility theory measurement error models monopoly non-governmental organizations measurement, theory of monopoly capitalism nonlinear panel data models mechanism design monopsony nonlinear programming mechanism design (new Moore, Henry ludwell (1869-1958) nonlinear time series analysis developments) moral hazard non-nested hypotheses mechanism design experiments Morgenstern, Oskar (1902-1977) nonparametric structural models medieval guilds Morishima, Michio 1923-2004 non-profit organizations Menger, Carl (1840-1921) mortality non-standard analysis mercantilism motion pictures, economics of non-substitution theorems Mercier De La Riviere, Pierre-Paul multilingualism non-tariff barriers (Mercier or lemercier) (1720-1793/4) multinational firms North American Free Trade Agreement Mercosur multiple equilibria in macroeconomics (NAFTA) merger analysis (United States) multiplier-accelerator interaction North, Douglass Cecil (born 1920) merger simulations multiplier analysis North, Dudley (1641-1691) mergers, endogenous Mun, Thomas (1571-1641) Nove, Alexander (Alec) N. (1915-1994) merit goods Mundell, Robert (born 1932) Novozhilov, Viktor Valentinovich Merton, Robert C. (born 1944) municipal bonds (1892-1970) Methodenstreit Musgrave, Richard Abel (1910-2007) numeraire xxii List of entries A-Z

social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strategic trade policy Theil, Henri (1924-2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760-1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes Thiinen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout, Charles Mills (1924-1968) spatial econometrics structural unemployment time consistency of monetary and spatial economics structural vector autoregressions fiscal policy spatial market integration structuralism time preference spatial mismatch hypothesis stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943) games Tobin, James (1918-2002) Spencer, Herbert (1820-1903) superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957) 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de ( 1805-1859) spontaneous order surplus Tooke, Thomas (1774-1858) sports, economics of survey data, analysis of Torrens, Robert (1780-1864) spurious regressions sustainability total factor productivity Sraffa, Piero ( 1898-1983) Swadeshi movement Townshend, Hugh (1890-1974) Sraffian economics Swan, Trevor W. (1914-1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlor (1910-2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarbell, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880-1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph (1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xxv

Tugan-Baranovsky, Mikhail lvanovich urbanization war and economics (1865-1919) user fees Warburton, Clark (1896-1979) tulipmania Usher, Abbot Payson (1884-1965) Warming, Jens (1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus L'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred (1868-1958) two-sector models value of life Weber, Max (1864-1920) two-sided markets value of time Weintraub, Sidney (1914-1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde (1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799-1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728-1797) (1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914-1996) Wicksteed, Philip Henry (1844-1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John (1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart (1853-1914) ( 1885-1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore 0. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) (1885-1939) urban production externalities Walras, Leon (1834-1910) Zeuthen, Frederik Ludvig Bang urban transportation economics Walras's Law (1888-1959) THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

Volume 2 command economy- epistemic game theory

palgrave macmillan © Macmillan Publishers Ltd. 2008 Softcover reprint of the hardcover 2nd edition 2008 978-0-333-78676-5

Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages.

This edition published 2008 by PALGRAVE MACMILLAN Houndmills, Basingstoke, Hampshire RG21 6XS and 175 Fifth Avenue, New York, N.Y. 10010 Companies and representatives throughout the world

ISBN-13 978-Q-230-22638-8 Volume 2

ISBN 978-1-349-58804-6 ISBN 978-1-349-58802-2 (eBook) DOI 10.1007/978-1-349-58802-2

A catalogue record for this book is available from the British Library.

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The new Palgrave dictionary of economics I edited by Steven N. Durlauf and Lawrence E. Blume. - 2nd ed. v. em. Rev. ed. of: The New Palgrave: a dictionary of economics. 1987. Includes bibliographical references.

1. Economics- Dictionaries. I. Durlauf, Steven N. II. Blume, Lawrence. Ill. New Palgrave.

HB61.N49 2008 330.03-dc22 2007047205

10 9 8 7 6 5 4 3 2 1 17 16 15 14 13 12 11 10 09 08

Typesetting and XML coding by Macmillan Publishing Solutions, Bangalore, India Contents

Publishing history vi

List of entries A-Z vii

The dictionary, volume 2 1

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis Palgrave, in three volumes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2nd edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi List of entries A-Z

Abramovitz, Moses (1912-2000) Aquinas, StThomas (1225-1274) Barton, John {1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic {1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas (1730-cl792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas (1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of (1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation (econometrics) asymmetric information behavioural genetics aggregation (production) Attwood, Thomas (1783-1856) behavioural public economics aggregation (theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram (1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy (1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram (1914-2003) agricultural research Aumann, Robert J. (born 1930) Berle, Adolf Augustus, Jr. (1895-1971) agriculture and economic development Aupetit, Albert (1876-1943) Bernacer, German (1883-1965) airline industry Auspitz, Rudolf {1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao ( 1952-1997) Australasia, economics in Bernstein, Eduard (1850-1932) Akerlof, George Arthur (born 1940) Austrian economics Bertrand competition Albert the Great. Saint Albertus Averch-Johnson effect Bertrand, Joseph Louis Fran~ois Magnus (c.1200-1280) Ayres, Clarence Edwin (1891-1972) (1822-1900) alienation Bachelier, Louis {1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter (1826-1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas {1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul {1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) (1876-1961) American Economic Association bandit problems bimetallism American exceptionalism Bank of England Black, Duncan (1908-1991) amortization banking crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe (1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Bohm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre le Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot (1958-2000) (1645-1714) antidumping Baran, Paul Alexander (1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas (1637/40-?1698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico (1859-1924) bootstrap Antonelli, Giovanni Battista {1858-1944) barriers to entry Barch, Karl H. (1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de (1733-1799) models (linear methods) barter in transition border effects

vii viii List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur Lyon (1869-1957) central limit theorems common knowledge Boyd, Walter (1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braude!, Fernand (1902-1985) Ceva, Giovanni (1647/48-1734) comparative advantage Braverman, Harry (1920-1976) Chalmers, Thomas (1780-184 7) comparative statics Brentano, Lujo (Ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916-1989) Chevalier, Michel (1806-1879) developments) Bruno, Michael ( 1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Bucher, Karl Wilhelm (1847-1930) Child, Josiah (1630-1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnot de, Abbe de Bukharin, Nikolai lvanovitch Chinese economic reforms Mureau (1714-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905-1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Fran~ois (c1750-1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) cliometrics consumption sets capital asset pricing model clubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Coase, Ronald Harry (born 1910) contestable markets capital gains taxation Coase theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard (1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) (1855-1921) conventionalism Carlyle, Thomas (1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866-1944) collective action convexity caste system collective action (new perspectives) convict labour cata llactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill (1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z ix

Corn Laws, free trade and derived demand economic governance protectionism Destutt De Tracy, Antoine Louis Claude economic growth corporate governance (1754-1836) economic growth, empirical corporate law, economic analysis of determinacy and indeterminacy of regularities in corporations equilibria economic growth in the very long run correspondence principle deterministic evolutionary dynamics economic growth nonlinearities correspondences deterrence (empirical), economic economic history cost-benefit analysis analyses of economic laws cost functions deterrence (theory), economics of economic man cost minimization and utility development accounting economic sanctions maximization development economics economic sociology cost-push inflation dialectical reasoning economic surplus and the countertrade Diaz-Aiejandro, Carlos (1937-1985) equimarginal principle countervailing power Dickinson, Henry Douglas (1899-1969) economics, definition of Courcelle-Seneuil, Jean Gustave Dietzel, Heinrich {1857-1935) economy as a complex system (1813-1892) difference-in-difference estimators econophysics Cournot, Antoine Augustin (1801-1877) diffusion of agricultural technology Eden, Frederick Morton (1766-1809) Cournot competition diffusion of technology Edgeworth, Francis Ysidro (1845-1926) creative destruction directly unproductive profit-seeking education in developing countries creative destruction (Schumpeterian (DUP) activities education production functions conception) Director, Aaron (1901-2004) educational finance credit card industry dispute resolution effective demand credit cycle distributed lags efficiency bounds credit rationing distributive politics and targeted public efficiency wages crime and the city spending efficient allocation cross-cultural experiments dividend policy efficient markets hypothesis crowding out Divisia, Fran~ois Jean Marie egalitarianism cultural transmission (1889-1964) Einaudi, Luigi {1874-1961) culture and economics Divisia index Eisner, Robert (1922-1998) Cunningham, William {1849-1919) division of labour elasticities approach to the balance of currency boards Dobb, Maurice Herbert {1900-1976) payments currency competition dollarization elasticity currency crises Domar, Evsey David (1914-1997) elasticity of intertemporal substitution currency crises models Dorfman, Joseph (1904-1991) elasticity of substitution currency unions Dornbusch, Rudiger (1942-2002) electricity markets Currie, Lauchlin (1902-1993) double-entry bookkeeping electronic commerce cyclical markups Douglas, Paul Howard (1892-1976) elites and economic outcomes Dalton, Edward Hugh John Neale dual economies Ellet, Charles, Jr. (1810-1862) (1887-1962) dual track liberalization Ely, Richard Theodore (1854-1943) Dantzig, George B. (1914-2005) duality emergence data filters Diihring, Eugen Karl (1833-1921) emerging markets data mining dummy variables empirical likelihood Davanzati, Bernardo (1529-1606) Dunlop, John Thomas (1914-2003) encompassing Davenant, Charles (1656-1714) Du Pont de Nemours, Pierre Samuel endogeneity and exogeneity Davenport, Herbert Joseph (1861-1931) (1739-1817) endogenous growth theory Davidson, David (1854-1942) Dupuit, Arsene-Jules-Emile Juvenal endogenous market incompleteness Debreu, Gerard (1921-2004) (1804-1866) energy economics decentralization durable goods markets and Engel, Ernst (1821-1896) decision theory afterma rkets Engel curve decision theory in econometrics Durbin-Watson statistic Engel's Law default and enforcement constraints Dutch Disease Engels, Friedrich {1820-1895) defence economics dynamic models with non-clearing Engle, Robert F. (born 1942) de Finetti, Bruno (1906-1985) markets English School of political economy de-industrialization, 'premature' dynamic programming Enlightenment, Scottish de-industrialization and the Dutch Easterlin hypothesis enterprise zones Disease Eckstein, Otto {1927-1984) entitlements in laboratory experi- demand price ecological economics ments demand-pull inflation ecological inference entrepreneurship demand theory econometrics envelope theorem democratic paradoxes economic anthropology environmental economics demographic transition economic calculation in socialist environmental Kuznets curve Denison, Edward (1915-1992) countries Ephemerides du citoyen ou chronique dependency economic demography de l'esprit national depletion economic development and the epistemic game theory: an overview deposit insurance environment epistemic game theory: beliefs and depreciation economic epidemiology types x List of entries A-Z epistemic game theory: complete famines Furtado, Celso (1920--2004) information Farr, William (1807-1883) futures markets, hedging and epistemic game theory: incomplete Farrell, Michael James (1926--1975) speculation information Fasiani, Mauro (1900--1950) Galbraith, John Kenneth (1908-2006) equality Faustmann, Martin Galiani, Ferdinanda (1728-1787) equality of opportunity (1822-1876) game theory equation of exchange Federal Reserve System game theory and biology equilibrium-correction models Fel'dman, Grigorii Alexandrovich game theory in economics, origins of equilibrium (development of the (1884-1958) games in coalitional form concept) feminist economics Geary, Robert Charles (1896--1983) equivalence scales fertility in developed countries Gee, Joshua (f1.1725-1750) ergodicity and nonergodicity in fertility in developing countries gender differences (experimental economics Fetter, Frank Albert (1863-1949) evidence) Erlich, Alexander (1913-1985) feudalism gender roles and division of labour estate and inheritance taxes fiat money general equilibrium ethics and economics fiducial inference general equilibrium (new Eucken, Walter (1891-1950) field experiments developments) Euler equations finance general purpose technologies Euler's theorem finance (new developments) generalized method of moments euro financial intermediation estimation European Central Bank financial liberalization generational accounting European labour markets financial market anomalies Genovesi, Antonio (1712-1769) European Monetary Union financial market contagion George, Henry (1839-1897) Evans, Griffith Conrad (1887-1973) financial structure and economic Georgescu-Roegen, Nicholas evolutionary economics development (1906--1994) ex ante and ex post finite sample econometrics Gerard-Varet, Louis-Andre (1944-2001) excess burden of taxation Finley, Moses (1912-1986) German economics in the early excess volatility tests firm boundaries (empirical studies) 19th century exchange firm-level employment dynamics German hyperinflation exchange rate dynamics firm, theory of the German reunification, economics of exchange rate exposure fiscal and monetary policies in Germany, economics in (20th century) exchange rate target zones developing countries Gerschenkron, Alexander (1904-1978) exchange rate volatility fiscal federalism Gervaise, Isaac (fl. 1680--1720) exchangeability fiscal theory of the price level Gesell, Silvio (1862-1930) excise taxes Fisher, Irving (1867-1947) ghettoes exhaustible resources Fisher, Ronald Aylmer (1890--1962) Gibrat, Robert Pierre Louis (1904-1980) existence of general equilibrium fisheries Gibrat's Law exit and voice fixed effects and random effects Giffen, Robert (1837-1910) expectations fixed factors Giffen's paradox expected utility hypothesis fixed point theorems Gilman, Charlotte Perkins (1860--1935) experimental economics fixprice models Gini, Corrado (1884-1965) experimental economics, history of Fleming, John Marcus (1911-1976) Gini ratio experimental labour economics Fogel, Robert William (born 1926) GIS data in economics experimental macroeconomics Forbonnais, Fran~ois Veron global analysis in economic theory experimental methods in economics Duverger de (1722-1800) global games experimental methods in forecasting globalization environmental economics forced saving globalization and labour experiments and econometrics foreign aid globalization and the welfare state explanation foreign direct investment gold standard exploitation foreign exchange market golden rule external economies microstructure Goldfeld, Stephen (1940--1995) externalities foreign exchange markets, history of Goldsmith, Raymond William extremal quantiles and value-at-risk Foster, William Trufant (1879-1950) (1904-1988) extreme bounds analysis fractals goods and commodities extreme poverty France, economics in (before 1870) Gordon, Robert Aaron (1908-1978) Fabian economics France, economics in (after 1870) Gorman, W. M. (Terence) factor content of trade franchising Gossen, Hermann Heinrich factor models free banking era Gournay, Jacques Claude Marie factor price equalization (historical free disposal Vincent, Marquis de (1712-1759) trends) Friedman, Milton (1912-2006) government budget constraint factor price frontier Frisch, Ragnar Anton Kittel (1895-1973) Graham, Frank Dunstone (1890--1949) factor prices in general equilibrium full and limited information methods Granger, Clive W. J. fair allocation Fullarton, John (1780?-1849) Granger-Sims causality falsification ism functional analysis graph theory family decision making functional central limit theorems graphical games family economics functional finance Graunt, John (1620--1674) List of entries A-Z xi gravity equation Hicks, John Richard (1904--1989) inflation expectations gravity models Hicks, Ursula Kathleen (1896-1985) inflation measurement Great Depression Hicksian and Marshallian demands inflation targeting Great Depression (mechanisms) hierarchical Bayes models informal economy Great Depression, monetary and hierarchy information aggregation and prices financial forces in Hildebrand, Bruno (1812-1878) information cascade experiments Great Divide Hilferding, Rudolf (1877-1941) information cascades green national accounting Hill, Polly (1914--2005) information sharing among firms Gresham, Thomas (cl519-1579) Hirshleifer, Jack (1926-2005) information technology and the world Gresham's Law historical demography economy Griliches, Zvi (1930-1999) historical economics, British Ingram, John Kells (1823-1907) gross substitutes Historical School, German inheritance and bequests Grossman, Herschel I. (1939-2004) history of economic thought Innis, Harold Adams (1894--1952) Grotius (de Groot), Hugo (1583-1645) Hobson, John Atkinson (1858-1940) input-output analysis group selection hold-up problem inside and outside money growth accounting home production insider trading growth and civil war homogeneous and homothetic institutional economics growth and cycles functions institutional trap growth and inequality (macro horizontal and vertical equity institutionalism, old perspectives) Hotelling, Harold (1895--1973) instrumentalism and operationalism growth and institutions hours worked (long-run trends) instrumental variables growth and international trade household portfolios insurance mathematics growth and learning-by-doing household production and public intangible capital growth models, multisector goods integrability of demand growth take-offs household surveys intellectual property Haavelmo, Trygve (1911-1999) housing policy in the United States intellectual property, history of Habakkuk, John Hrothgar (1915-2002) housing supply interacting agents in finance Haberler, Gottfried (1900-1995) human capital interdependent preferences habit persistence human capital, fertility and growth interest rates Hadley, Arthur Twining (1856-1930) Hume, David (1711-1776) intergenerational income mobility Hagen, Everett Einar (1906-1993) hunters, gatherers, cities and evolution intergenerational transmission Hamilton, Alexander (1755-1804) hunting and gathering economies intergovernmental grants Hamiltonians Hutcheson, Francis (1694--1746) internal economies Hannan, Edward J. (1921-1994) hyperinflation internal migration Hansen, Alvin (1887-1975) ideal output internal rate of return happiness, economics of identification international capital flows Harris, Seymour Edwin (1897-1975) identity international economics, history of Harris-Todaro hypothesis immigration and the city international finance Harrod, Roy Forbes (1900-1978) immiserizing growth international financial institutions (IFis) Harsanyi, John C. (1920-2000) implicit contracts international migration Hart, Albert Gailord (1909-1997) impulse response function International Monetary Fund Hawkins-Simon conditions imputation international monetary institutions Hawley, Frederick Barnard (1843-1929) incentive compatibility international outsourcing Hawtrey, Ralph George (1879-1975) income mobility international policy coordination Hayek, Friedrich August von income taxation and optimal policies international real business cycles (1899-1992) incomplete contracts international reserves hazardous waste, economics of incomplete markets international trade, empirical health economics indentured servitude approaches to health insurance, economics of index numbers international trade and heterogeneous health outcomes (economic India, economics in firms determinants) indicative planning international trade theory Heckman, James (born 1944) indirect inference Internet, economics of the Heckscher, Eli Filip (1879-1952) indirect utility function interpersonal utility comparisons Heckscher-Ohlin trade theory individual learning in games interpersonal utility comparisons (new hedging individual retirement accounts developments) hedonic prices individualism versus holism intertemporal choice Heilbroner, Robert L. (1919-2005) indivisibilities intertemporal equilibrium and Heller, Walter Perrin (1942-2001) industrial relations efficiency Heller, Walter Wolfgang (1915-1987) Industrial Revolution intrahousehold welfare Hennipman, Pieter (1911-1994) inequality between nations inventory investment Hermann, Friedrich Benedict Wilhelm inequality (global) investment decision criteria von (1795-1868) inequality (international evidence) investment (neoclassical) Herskovits, Melville Jean (1895-1963) inequality (measurement) invisible hand heterodox economics infant-industry protection involuntary unemployment heteroskedasticity and autocorrelation inflation Ireland, economics in corrections inflation dynamics iron law of wages xii List of entries A-Z

numerical optimization methods in peasant economy Prebisch, Raul (1901-1986) economics pecuniary versus non-pecuniary precautionary principle Nurkse, Ragnar (1907-1959) penalties precautionary saving and nutrition and development Penrose, Edith Tilton (1914-1996) precautionary wealth nutrition and public policy in advanced pensions predatory pricing economies perfect competition prediction formulas offer curve or reciprocal demand curve perfect foresight prediction markets Ohlin, Bertil Gotthard (1899-1979) perfect information prediction market design oil and the macroeconomy period of production preference reversals Okun, Arthur M. (1928-1980) Perlman, Selig (1888-1959) Preobrazhensky, Evgenii Alexeyevich Okun's Law permanent-income hypothesis (1886-1937) oligarchs Perron-Frobenius theorem preordering oligopoly Perroux, Fran~ois (1903-1987) Prescott, Edward Christian (born 1940) Olson, Mancur (1932-1998) personnel economics present value operations research Persons, Warren Milton (1878-1937) price control opportunity cost peso problem price discrimination (empirical studies) optimal fiscal and monetary policy Petty, William (1623-1687) price discrimination (theory) (with commitment) pharmaceutical industry price dispersion optimal fiscal and monetary policy Phelps Brown, (Ernest) Henry price revolution (without commitment) (1906-1994) primary and secondary labour markets optimal tariffs Phelps, Edmund (born 1933) principal and agent (i) optimal taxation Phillips, Alban William Housego principal and agent (ii) optimality and efficiency (1914-1975) privatization optimum quantity of money Phillips curve privatization impacts in transition options Phillips curve (new views) economies options (new perspectives) philosophy and economics procurement orderings physiocracy product differentiation Oresme, Nicholas (1325-1382) Pierson, Nichlaas Gerard (1839-1909) product life cycle organic composition of capital Pigou, Arthur Cecil (1877-1959) production functions Organization of the Petroleum Pigouvian taxes profit and profit theory Exporting Countries (OPEC) planning progressive and regressive taxation Ortes, Giammaria (1713-1790) Plekhanov, Georgii Valentinovich propensity score output fall - transformational recession (1856-1918) property law, economics and overlapping generations model of pluralism in economics property rights general equilibrium Polanyi, Karl (1886-1964) property taxation Overstone, Lord [Samuel Jones Loyd] polarization proportional hazard model (1796-1883) policy reform, political economy of prospect theory Owen, Robert (1771-1858) political arithmetic protoindustrialization Palander, Tord Folkeson (1902-1972) political budget cycles psychological games Palgrave, Robert Harry Inglis political business cycles psychology of social networks (1827-1919) political competition public capital Palgrave's Dictionary of Political 'political economy' public choice Economy political institutions, economic public debt Palmer, John Horsley (1779-1858) approaches to public finance panic of 1907 pollution haven hypothesis public goods Pantaleoni, Maffeo (1857-1924) pollution permits public goods experiments paradigms Pontryagin's principle of optimality public infrastructure paradoxes and anomalies Poor Law, new public utility pricing and finance Pareto, Vilfredo (1848-1923) Poor Law, old public works Pareto distribution population ageing Pufendorf, Samuel von (1632-1694) Pareto efficiency population and agricultural growth purchasing power parity Pareto principle and competing population dynamics purification principles population health, economic quantal response equilibria partial identification in econometrics implications of quantile regression partial linear model Portugal, economics in quantity theory of money Pascal, Blaise (1623-1662) positive economics quasi-concavity p.ttents positivism Quesnay, Fran~ois (1694-1774) p.ttent valuation Post Keynesian economics R&D races p.tth dependence Postan, Michael Mo'issey (1899-1981) racial profiling path dependence and occupations postmodernism radical economics path dependence in technical poverty Rae, John (1796-1872) standards poverty alleviation programmes Rae, John (1845-1915) Patinkin, Don (1922-1955) poverty lines Ramsey, Frank Plumpton (1903-1930) Patten, Simon Nelson (1852-1922) poverty traps Ramsey model payment systems power Ramsey pricing peasants power laws rational behaviour List of entries A-Z xv rational choice and political science Robinson Crusoe self-confirming equilibria rational choice and sociology Robinson, Edward Austin Gossage Seligman, Edwin Robert Anderson rational expectations (1897-1993} (1861-1939) rational expectations models, Robinson, Joan Violet (1903-1983} Selten, Reinhard (born 1930) estimation of robust control semiparametric estimation rationality robust estimators in econometrics Sen, Amartya (born 1933} rationality, bounded Rogers, James Edwin Thorold Senior, Nassau William (1790-1864} rationality, history of the concept (1823-1890} separability rationing Roos, Charles Frederick (1901-1958} sequence economies Rau, Karl Heinrich (1792-1870} Roscher, Wilhelm Georg Friedrich sequential analysis Raymond, Daniel (1786-1849} (1817-1894) serial correlation and serial real balances Rosen, Sherwin (1938-2001) dependence real bills doctrine Rosenstein-Rodan, Paul Narcyz Shackle, George Lennox Sharman real bills doctrine versus the quantity (1902-1985} (1903-1992) theory Rosenthal, Robert W. (1944-2002} shadow pricing real business cycles Rostow, Walt Whitman (1916-2003} Shapley value real cost doctrine rotating saving and credit associations Shapley-Folkman theorem real exchange rates (ROSCAs) sharecropping real rigidities Rothbard, Murray N. (1926-1995) Sharpe, William F. (born 1934} real wage rates (historical trends) rotten kid theorem Shephard, Ronald William (1912-1982} realized volatility Roy model shrinkage-biased estimation in reciprocity and collective action Roy, Rene Fran~ois Joseph (1894-1977) econometrics recursive competitive equilibrium Royal Economic Society Sidgwick, Henry (1838-1900} recursive contracts Rubin causal model Sidrauski, Miguel {1939-1968} recursive preferences Ruggles, Richard (1916-2001} sieve extremum estimation redistribution of income and wealth Saint-Simon, Claude-Henri (1760-1825) signalling and screening reduced rank regression Samuelson, Paul Anthony (born 1915} silver standard regime switching models Sargan, John Denis 1924-1996 Simon, Herbert A. (1916-2001} regional and preferential trade satisficing Simons, Henry Calvert (1899-1946} agreements Sauvy, Alfred (1898-1990} Simonsen, Mario Henrique (1935-1997} regional development, geography of Savage, Leonard J. (Jimmie) simplex method for solving linear regression-discontinuity analysis (1917-1971) programs regular economies Savage's subjective expected utility simulation-based estimation regulation model simulation estimators in Reid, Margaret Gilpin (1896-1991} Sax, Emil (1845-1927) macroeconometrics religion and economic development Say, (Jean-Baptiste) Leon (1826-1896) simultaneous equations models religion, economics of Say, Jean-Baptiste (1767-1832} single tax rent Say's Law Sismondi, Jean Charles Leonard rent control Scandinavia, economics in Simonde de (1773-1842) rent seeking Schelling, Thomas C. (born 1921) size of nations, economics approach repeated games Schlesinger, Karl (1889-1938) to the reputation Schmoller, Gustav von (1838-1917) skill-biased technical change resale markets Schmookler, Jacob (1918-1967} slavery research joint ventures scholastic economics Slichter, Sumner Huber {1892-1959} reservation price and reservation Scholes, Myron (born 1941} sliding scales (wages) demand school choice and competition Slutsky, Eugen (1880-1948} residential real estate and finance Schultz, Henry (1893-1938) small-world networks residential segregation Schultz, T. W. (1902-1998} Smart, William (1853-1915} reswitching of technique Schumpeter, Joseph Alois (1883-1950) Smith, Adam (1723-1790} retirement Schumpeterian growth and growth Smith, Bruce D. (1954-2002) returns to scale policy design Smith, Vernon (born 1927) returns to scale measurement science, economics of SNP: nonparametric time series returns to schooling scientific realism and ontology analysis revealed preference theory Scitovsky, Tibor (1910-2002) social capital revelation principle Scott, William Robert (1868-1940} social choice reverse capital deepening Scrope, George Poulett (1797-1876} social choice (new developments) rhetoric of economics search-and-matching models of social contract Ricardo, David (1772-1823) monetary exchange social democracy Ricardian equivalence theorem search models of unemployment social discount rate Ricardian trade theory search theory social insurance risk search theory (new perspectives) social insurance and public policy risk aversion seasonal adjustment social interactions (empirics) risk-coping strategies second best social interactions (theory) risk sharing second economy (unofficial economy) social learning Robbins, Lionel Charles (1898-1984} seemingly unrelated regressions social multipliers Robertson, Dennis (1890-1963} selection bias and self-selection social networks, economic relevance of xvi List of entries A-Z social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strategic trade policy Theil, Henri (1924-2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760--1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes Thiinen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout, Charles Mills (1924-1968) spatial econometrics structural unemployment time consistency of monetary and spatial economics structural vector autoregressions fiscal policy spatial market integration structuralism time preference spatial mismatch hypothesis stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943) games Tobin, James (1918-2002) Spencer, Herbert (1820--1903) superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957) 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de (1805-1859) spontaneous order surplus Tooke, Thomas (1774-1858) sports, economics of survey data, analysis of Torrens, Robert (1780--1864) spurious regressions sustainability total factor productivity Sraffa, Piero (1898--1983) Swadeshi movement Townshend, Hugh (1890--1974) Sraffian economics Swan, Trevor W. (1914-1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlor (1910--2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarbell, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880--1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph (1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xvii

Tugan-Baranovsky, Mikhail lvanovich urbanization war and economics (1865-1919) user fees Warburton, Clark (1896-1979) tulipmania Usher, Abbot Payson (1884-1965) Warming, Jens (1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus L'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred (1868-1958) two-sector models value of life Weber, Max (1864-1920) two-sided markets value of time Weintraub, Sidney (1914-1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde (1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799-1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728-1797) (1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914-1996) Wicksteed, Philip Henry (1844-1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John (1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart (1853-1914) (1885-1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore 0. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) (1885-1939) urban production externalities Walras, Leon (1834-1910) Zeuthen, Frederik Ludvig Bang urban transportation economics Walras's Law (1888-1959) THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

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The new Palgrave dictionary of economics I edited by Steven N. Durlauf and Lawrence E. Blume. - 2nd ed. v. em. Rev. ed. of: The New Palgrave : a dictionary of economics. 1987. Includes bibliographical references.

1. Economics- Dictionaries. I. Durlauf, Steven N. II. Blume, Lawrence. Ill. New Palgrave.

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10 9 8 7 6 5 4 3 2 1 17 16 15 14 13 12 11 10 09 08

Typesetting and XML coding by Macmillan Publishing Solutions, Bangalore, India Contents

Publishing history vi

List of entries A-Z Vll

The dictionary, volume 3

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis Palgrave, in three volumes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2"d edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi List of entries A-Z

Abramovitz, Moses (1912-2000) Aquinas, StThomas (1225-1274) Barton, John (1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic (1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas (1730-cl792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas (1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of (1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation (econometrics) asymmetric information behavioural genetics aggregation (production) Attwood, Thomas (1783-1856) behavioural public economics aggregation (theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram (1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy (1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram (1914-2003) agricultural research Aumann, Robert J. (born 1930) Serle, Adolf Augustus, Jr. (1895-1971) agriculture and economic development Aupetit, Albert (1876-1943) Bernacer, German (1883-1965) airline industry Auspitz, Rudolf (1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao (1952-1997) Australasia, economics in Bernstein, Eduard (1850-1932) Akerlof, George Arthur (born 1940) Austrian economics Bertrand competition Albert the Great, Saint Albertus Averch-Johnson effect Bertrand, Joseph Louis Fran~ois Magnus (c.120D-1280) Ayres, Clarence Edwin (1891-1972) (1822-1900) alienation Bachelier, Louis (1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter (1826-1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas (1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul (1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) (1876-1961) American Economic Association bandit problems bimetallism American exceptionalism Bank of England Black, Duncan (1908-1991) amortization banking crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe (1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Btihm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre le Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot (1958-2000) (1645-1714) antidumping Baran, Paul Alexander (1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas (1637/40-?1698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico (1859-1924) bootstrap Antonelli, Giovanni Battista (1858-1944) barriers to entry Borch, Karl H. (1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de (1733-1799) models (linear methods) barter in transition border effects

vii viii List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur Lyon {1869-1957) central limit theorems common knowledge Boyd, Walter {1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braudel, Fernand (1902-1985) Ceva, Giovanni (1647/48-1734) comparative advantage Braverman, Harry (1920--1976) Chalmers, Thomas (1780--1847) comparative statics Brentano, Lujo (Ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916--1989) Chevalier, Michel (1806--1879) developments) Bruno, Michael (1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Biicher, Karl Wilhelm (1847-1930) Child, Josiah (1630--1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnot de, Abbe de Bukharin, Nikolai lvanovitch Chinese economic reforms Mureau (1714-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905-1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Fran~ois (c1750--1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) cliometrics consumption sets capital asset pricing model clubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Coase, Ronald Harry (born 1910) contestable markets capital gains taxation Coase theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard (1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) {1855-1921) conventionalism Carlyle, Thomas {1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866--1944) collective action convexity caste system collective action (new perspectives) convict labour catallactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill {1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z ix

epistemic game theory: complete famines Furtado, Celso (1920--2004) information Farr, William (1807-1883) futures markets, hedging and. epistemic game theory: incomplete Farrell, Michael James (1926-1975) speculation information Fasiani, Mauro (1900-1950) Galbraith, John Kenneth (1908-2006) equality Faustmann, Martin Galiani, Ferdinanda (1728-1787) equality of opportunity (1822-1876) game theory equation of exchange Federal Reserve System game theory and biology equilibrium-correction models Fel'dman, Grigorii Alexandrovich game theory in economics, origins of equilibrium (development of the (1884-1958) games in coalitional form concept) feminist economics Geary, Robert Charles (1896-1983) equivalence scales fertility in developed countries Gee, Joshua (jl.1725--1750) ergodicity and nonergodicity in fertility in developing countries gender differences (experimental economics Fetter, Frank Albert (1863-1949) evidence) Erlich, Alexander (1913-1985) feudalism gender roles and division of labour estate and inheritance taxes fiat money general equilibrium ethics and economics fiducial inference general equilibrium (new Eucken, Walter (1891-1950) field experiments developments) Euler equations finance general purpose technologies Euler's theorem finance (new developments) generalized method of moments euro financial intermediation estimation European Central Bank financial liberalization generational accounting European labour markets financial market anomalies Genovesi, Antonio (1712-1769) European Monetary Union financial market contagion George, Henry (1839-1897) Evans, Griffith Conrad (1887-1973) financial structure and economic Georgescu-Roegen, Nicholas evolutionary economics development (1906-1994) ex ante and ex post finite sample econometrics Gerard-Varet, Louis-Andre (1944-2001) excess burden of taxation Finley, Moses (1912-1986) German economics in the early excess volatility tests firm boundaries (empirical studies) 19th century exchange firm-level employment dynamics German hyperinflation exchange rate dynamics firm, theory of the German reunification, economics of exchange rate exposure fiscal and monetary policies in Germany, economics in (20th century) exchange rate target zones developing countries Gerschenkron, Alexander (1904-1978) exchange rate volatility fiscal federalism Gervaise, Isaac (fl. 1680--1720) exchangeability fiscal theory of the price level Gesell, Silvio (1862-1930) excise taxes Fisher, Irving (1867-1947) ghettoes exhaustible resources Fisher, Ronald Aylmer (1890--1962) Gibrat, Robert Pierre Louis (1904-1980) existence of general equilibrium fisheries Gibrat's Law exit and voice fixed effects and random effects Giffen, Robert (1837-1910) expectations fixed factors Giffen's paradox expected utility hypothesis fixed point theorems Gilman, Charlotte Perkins (1860--1935) experimental economics fixprice models Gini, Corrado (1884-1965) experimental economics, history of Fleming, John Marcus (1911-1976) Gini ratio experimental labour economics Fogel, Robert William (born 1926) GIS data in economics experimental macroeconomics Forbonnais, Fran~ois Veron global analysis in economic theory experimental methods in economics Duverger de (1722-1800) global games experimental methods in forecasting globalization environmental economics forced saving globalization and labour experiments and econometrics foreign aid globalization and the welfare state explanation foreign direct investment gold standard exploitation foreign exchange market golden rule external economies microstructure Goldfeld, Stephen (1940--1995) externalities foreign exchange markets, history of Goldsmith, Raymond William extremal quantiles and value-at-risk Foster, William Trufant (1879-1950) (1904-1988) extreme bounds analysis fractals goods and commodities extreme poverty France, economics in (before 1870) Gordon, Robert Aaron (1908-1978) Fabian economics France, economics in (after 1870) Gorman, W. M. (Terence) factor content of trade franchising Gossen, Hermann Heinrich factor models free banking era Gournay, Jacques Claude Marie factor price equalization (historical free disposal Vincent, Marquis de (1712-1759) trends) Friedman, Milton (1912-2006) government budget constraint factor price frontier Frisch, Ragnar Anton Kittel (1895-1973) Graham, Frank Dunstone (1890--1949) factor prices in general equilibrium full and limited information methods Granger, Clive W. J. fair allocation Fullarton, John (1780?-1849) Granger-Sims causality falsificationism functional analysis graph theory family decision making functional central limit theorems graphical games family economics functional finance Graunt, John (1620-1674) List of entries A-Z xi

rational choice and political science Robinson Crusoe self-confirming equilibria rational choice and sociology Robinson, Edward Austin Gossage Seligman, Edwin Robert Anderson rational expectations (1897-1993) (1861-1939) rational expectations models, Robinson, Joan Violet (1903-1983) Selten, Reinhard (born 1930) estimation of robust control semiparametric estimation rationality robust estimators in econometrics Sen, Amartya (born 1933) rationality, bounded Rogers, James Edwin Thorold Senior, Nassau William (1790-1864) rationality, history of the concept (1823-1890) separability rationing Roos, Charles Frederick (1901-1958) sequence economies Rau, Karl Heinrich (1792-1870) Roscher, Wilhelm Georg Friedrich sequential analysis Raymond, Daniel (1786-1849) (1817-1894) serial correlation and serial real balances Rosen, Sherwin (1938-2001) dependence real bills doctrine Rosenstein-Rodan, Paul Narcyz Shackle, George lennox Sharman real bills doctrine versus the quantity (1902-1985) (1903-1992) theory Rosenthal, Robert W. (1944--2002) shadow pricing real business cycles Rostow, Walt Whitman (1916-2003) Shapley value real cost doctrine rotating saving and credit associations Shapley-Folkman theorem real exchange rates (ROSCAs) sharecropping real rigidities Rothbard, Murray N. (1926-1995) Sharpe, William F. (born 1934) real wage rates (historical trends) rotten kid theorem Shephard, Ronald William (1912-1982) realized volatility Roy model shrinkage-biased estimation in reciprocity and collective action Roy, Rene Fran.;:ois Joseph (1894--1977) econometrics recursive competitive equilibrium Royal Economic Society Sidgwick, Henry (1838-1900) recursive contracts Rubin causal model Sidrauski, Miguel (1939-1968) recursive preferences Ruggles, Richard (1916-2001) sieve extremum estimation redistribution of income and wealth Saint-Simon, Claude-Henri (1760-1825) signalling and screening reduced rank regression Samuelson, Paul Anthony (born 1915) silver standard regime switching models Sargan, John Denis 1924--1996 Simon, Herbert A. (1916-2001) regional and preferential trade satisficing Simons, Henry Calvert (1899-1946) agreements Sauvy, Alfred (1898-1990) Simonsen, Mario Henrique (1935-1997) regional development, geography of Savage, leonard J. (Jimmie) simplex method for solving linear regression-discontinuity analysis (1917-1971) programs regular economies Savage's subjective expected utility simulation-based estimation regulation model simulation estimators in Reid, Margaret Gilpin (1896-1991) Sax, Emil (1845-1927) macroeconometrics religion and economic development Say, (Jean-Baptiste) leon (1826-1896) simultaneous equations models religion, economics of Say, Jean-Baptiste (1767-1832) single tax rent Say's law Sismondi, Jean Charles leonard rent control Scandinavia, economics in Simonde de (1773-1842) rent seeking Schelling, Thomas C. (born 1921) size of nations, economics approach repeated games Schlesinger, Karl (1889-1938) to the reputation Schmoller, Gustav von (1838-1917) skill-biased technical change resale markets Schmookler, Jacob (1918-1967) slavery research joint ventures scholastic economics Slichter, Sumner Huber (1892-1959) reservation price and reservation Scholes, Myron (born 1941) sliding scales [wages) demand school choice and competition Slutsky, Eugen (1880-1948) residential real estate and finance Schultz, Henry (1893-1938) small-world networks residential segregation Schultz, T. W. (1902-1998) Smart, William (1853-1915) reswitching of technique Schumpeter, Joseph Alois (1883-1950) Smith, Adam (1723-1790) retirement Schumpeterian growth and growth Smith, Bruce D. (1954--2002) returns to scale policy design Smith, Vernon (born 1927) returns to scale measurement science, economics of SNP: nonparametric time series returns to schooling scientific realism and ontology analysis revealed preference theory Scitovsky, Tibor (1910-2002) social capital revelation principle Scott, William Robert (1868-1940) social choice reverse capital deepening Scrope, George Poulett (1797-1876) social choice (new developments) rhetoric of economics search-and-matching models of social contract Ricardo, David (1772-1823) monetary exchange social democracy Ricardian equivalence theorem search models of unemployment social discount rate Ricardian trade theory search theory social insurance risk search theory [new perspectives) social insurance and public policy risk aversion seasonal adjustment social interactions (empirics) risk-coping strategies second best social interactions (theory) risk sharing second economy (unofficial economy) social learning Robbins, Lionel Charles (1898-1984) seemingly unrelated regressions social multipliers Robertson, Dennis (1890-1963) selection bias and self-selection social networks, economic relevance of xvi List of entries A-Z social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strategic trade policy Theil, Henri (1924-2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760-1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes Thiinen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout, Charles Mills (1924-1968) spatial econometrics structural unemployment time consistency of monetary and spatial economics structural vector autoregressions fiscal policy spatial market integration structuralism time preference spatial mismatch hypothesis stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943) games Tobin, James (1918-2002) Spencer, Herbert (1820-1903) superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957) 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de (1805-1859) spontaneous order surplus Tooke, Thomas (1774-1858) sports, economics of survey data, analysis of Torrens, Robert (1780-1864) spurious regressions sustainability total factor productivity Sraffa, Piero (1898-1983) Swadeshi movement Townshend, Hugh (189G--1974) Sraffian economics Swan, Trevor W. (1914-1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlor (191G--2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarbell, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880-1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph ( 1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xvii

Tugan-Baranovsky, Mikhail lvanovich urbanization war and economics (1865-1919) user fees Warburton, Clark {1896-1979) tulipmania Usher, Abbot Payson {1884-1965) Warming, Jens {1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus L'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred {1868-1958) two-sector models value of life Weber, Max {1864-1920) two-sided markets value of time Weintraub, Sidney (1914-1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde {1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799-1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728--1797) {1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914-1996) Wicksteed, Philip Henry (1844-1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John {1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart {1853-1914) (1885-1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore 0. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) {1885-1939) urban production externalities Walras, Leon {1834-1910) Zeuthen, Frederik Ludvig Bang urban transportation economics Walras's Law (1888--1959) THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

Volume 4 Hermann- Lange

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Publishing history VI

List of entries A-Z Vll

The dictionary, volume 4

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis Palgrave, in three volumes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2nd edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi List of entries A-Z

Abramovitz, Moses (1912-2000) Aquinas, StThomas (1225-1274) Barton, John (1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic (1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas (l730-c1792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas (1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of (1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation (econometrics) asymmetric information behavioural genetics aggregation (production) Attwood, Thomas (1783-1856) behavioural public economics aggregation (theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram (1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy (1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram (1914-2003) agricultural research Aumann, Robert J. (born 1930) Serle, Adolf Augustus, Jr. (1895-1971) agriculture and economic development Aupetit, Albert (1876-1943) Bernacer, German (1883-1965) airline industry Auspitz, Rudolf (1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao (1952-1997) Australasia, economics in Bernstein, Eduard (1850-1932) Akerlof, George Arthur (born 1940) Austrian economics Bertrand competition Albert the Great, Saint Albertus Averch-Johnson effect Bertrand, Joseph Louis Fran~ois Magnus (c.1200-1280) Ayres. Clarence Edwin (1891-1972) (1822-1900) alienation Bachelier, Louis (1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter (1826-1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas (1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul (1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) (1876-1961) American Economic Association bandit problems bimetallism American exceptionalism Bank of England Black, Duncan (1908-1991) amortization banking crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe (1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Bohm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre le Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot ( 1958-2000) (1645-1714) antidumping Baran, Paul Alexander (1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas ( 1637/40-?1698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico (1859-1924) bootstrap Antonelli, Giovanni Battista (1858-1944) barriers to entry Borch, Karl H. (1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de (1733-1799) models (linear methods) barter in transition border effects

vii viii List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur Lyon (1869-1957) central limit theorems common knowledge Boyd, Walter (1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braude!, Fernand (1902-1985) Ceva, Giovanni (1647/48-1734) comparative advantage Braverman, Harry (1920--1976) Chalmers, Thomas (1780-1847) comparative statics Brentano, Lujo (Ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916-1989) Chevalier, Michel (1806-1879) developments) Bruno, Michael (1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Bucher, Karl Wilhelm (1847-1930) Child, Josiah (1630-1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnot de, Abbe de Bukharin, Nikolai lvanovitch Chinese economic reforms Mureau (1714-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905-1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Fran~ois (cl750--1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) cliometrics consumption sets capital asset pricing model clubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Coase, Ronald Harry (born 1910) contestable markets capital gains taxation Coase theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard (1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) (1855-1921) conventionalism Carlyle, Thomas (1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866-1944) collective action convexity caste system collective action (new perspectives) convict labour catallactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill (1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z ix

epistemic game theory: complete famines Furtado, Celso (1920-2004) information Farr, William (1807-1883) futures markets, hedging and epistemic game theory: incomplete Farrell, Michael James (1926-1975) speculation information Fasiani, Mauro (1900-1950) Galbraith, John Kenneth (1908-2006) equality Faustmann, Martin Galiani, Ferdinando (1728-1787) equality of opportunity (1822-1876) game theory equation of exchange Federal Reserve System game theory and biology equilibrium-correction models Fel'dman, Grigorii Alexandrovich game theory in economics, origins of equilibrium (development of the (1884-1958) games in coalitional form concept) feminist economics Geary, Robert Charles (1896-1983) equivalence scales fertility in developed countries Gee, Joshua (jl.1725-1750) ergodicity and nonergodicity in fertility in developing countries gender differences (experimental economics Fetter, Frank Albert (1863-1949) evidence) Erlich, Alexander (1913-1985) feudalism gender roles and division of labour estate and inheritance taxes fiat money general equilibrium ethics and economics fiducial inference general equilibrium (new Eucken, Walter (1891-1950) field experiments developments) Euler equations finance general purpose technologies Euler's theorem finance (new developments) generalized method of moments euro financial intermediation estimation European Central Bank financial liberalization generational accounting European labour markets financial market anomalies Genovesi, Antonio (1712-1769) European Monetary Union financial market contagion George, Henry (1839-1897) Evans, Griffith Conrad (1887-1973) financial structure and economic Georgescu-Roegen, Nicholas evolutionary economics development (1906-1994) ex ante and ex post finite sample econometrics Gerard-Varet, Louis-Andre (1944-200 1) excess burden of taxation Finley, Moses (1912-1986) German economics in the early excess volatility tests firm boundaries (empirical studies) 19th century exchange firm-level employment dynamics German hyperinflation exchange rate dynamics firm, theory of the German reunification, economics of exchange rate exposure fiscal and monetary policies in Germany, economics in (20th century) exchange rate target zones developing countries Gerschenkron, Alexander (1904-1978) exchange rate volatility fiscal federalism Gervaise, Isaac (jl. 1680-1720) exchangeability fiscal theory of the price level Gesell, Silvio (1862-1930) excise taxes Fisher, Irving (1867-1947) ghettoes exhaustible resources Fisher, Ronald Aylmer (1890-1962) Gibrat, Robert Pierre Louis (1904-1980) existence of general equilibrium fisheries Gibrat's Law exit and voice fixed effects and random effects Giffen, Robert (1837-1910) expectations fixed factors Giffen's paradox expected utility hypothesis fixed point theorems Gilman, Charlotte Perkins (1860-1935) experimental economics fixprice models Gini, Corrado (1884-1965) experimental economics, history of Fleming, John Marcus (1911-1976) Gini ratio experimental labour economics Fogel, Robert William (born 1926) GIS data in economics experimental macroeconomics Forbonnais, Fran~ois Veron global analysis in economic theory experimental methods in economics Duverger de (1722-1800) global games experimental methods in forecasting globalization environmental economics forced saving globalization and labour experiments and econometrics foreign aid globalization and the welfare state explanation foreign direct investment gold standard exploitation foreign exchange market golden rule external economies microstructure Goldfeld, Stephen (1940-1995) externalities foreign exchange markets, history of Goldsmith, Raymond William extremal quantiles and value-at-risk Foster, William Trufant (1879-1950) (1904-1988) extreme bounds analysis fractals goods and commodities extreme poverty France, economics in (before 1870) Gordon, Robert Aaron (1908-1978) Fabian economics France, economics in (after 1870) Gorman, W. M. (Terence) factor content of trade franchising Gossen, Hermann Heinrich factor models free banking era Gournay, Jacques Claude Marie factor price equalization (historical free disposal Vincent, Marquis de (1712-1759) trends) Friedman, Milton (1912-2006) government budget constraint factor price frontier Frisch, Ragnar Anton Kittel (1895-1973) Graham, Frank Dunstone (1890-1949) factor prices in general equilibrium full and limited information methods Granger, Clive W. J. fair allocation Fullarton, John (1780?-1849) Granger-Sims causality falsification ism functional analysis graph theory family decision making functional central limit theorems graphical games family economics functional finance Graunt, John (1620-1674) List of entries A-Z xi gravity equation Hicks, John Richard (1904--1989) inflation expectations gravity models Hicks, Ursula Kathleen (1896-1985) inflation measurement Great Depression Hicksian and Marshallian demands inflation targeting Great Depression (mechanisms) hierarchical Bayes models informal economy Great Depression, monetary and hierarchy information aggregation and prices financial forces in Hildebrand, Bruno (1812-1878) information cascade experiments Great Divide Hilferding, Rudolf (1877-1941} information cascades green national accounting Hill, Polly (1914--2005) information sharing among firms Gresham, Thomas (cl519-1579) Hirshleifer, Jack (1926-2005) information technology and the world Gresham's Law historical demography economy Griliches, Zvi (1930--1999) historical economics, British Ingram, John Kells (1823-1907) gross substitutes Historical School, German inheritance and bequests Grossman, Herschel I. (1939-2004) history of economic thought Innis, Harold Adams (1894--1952) Grotius (de Groot), Hugo (1583-1645) Hobson, John Atkinson (1858-1940) input-output analysis group selection hold-up problem inside and outside money growth accounting home production insider trading growth and civil war homogeneous and homothetic institutional economics growth and cycles functions institutional trap growth and inequality (macro horizontal and vertical equity institutionalism, old perspectives) Hotelling, Harold (1895-1973) instrumentalism and operationalism growth and institutions hours worked (long-run trends) instrumental variables growth and international trade household portfolios insurance mathematics growth and learning-by-doing household production and public intangible capital growth models, multisector goods integrability of demand growth take-offs household surveys intellectual property Haavelmo, Trygve (1911-1999) housing policy in the United States intellectual property, history of Habakkuk, John Hrothgar (1915-2002) housing supply interacting agents in finance Haberler, Gottfried (1900--1995) human capital interdependent preferences habit persistence human capital, fertility and growth interest rates Hadley, Arthur Twining (1856-1930) Hume, David (1711-1776) intergenerational income mobility Hagen, Everett Einar (1906-1993) hunters, gatherers, cities and evolution intergenerational transmission Hamilton, Alexander (1755-1804) hunting and gathering economies intergovernmental grants Hamiltonians Hutcheson, Francis (1694--1746) internal economies Hannan, Edward J. (1921-1994) hyperinflation internal migration Hansen, Alvin (1887-1975) ideal output internal rate of return happiness, economics of identification international capital flows Harris, Seymour Edwin (1897-1975) identity international economics, history of Harris-Todaro hypothesis immigration and the city international finance Harrod, Roy Forbes ( 1900--1978) immiserizing growth international financial institutions (IFis) Harsanyi, John C. (1920--2000) implicit contracts international migration Hart, Albert Gailord (1909-1997) impulse response function International Monetary Fund Hawkins-Simon conditions imputation international monetary institutions Hawley, Frederick Barnard (1843-1929) incentive compatibility international outsourcing Hawtrey, Ralph George (1879-1975) income mobility international policy coordination Hayek, Friedrich August von income taxation and optimal policies international real business cycles (1899-1992) incomplete contracts international reserves hazardous waste, economics of incomplete markets international trade, empirical health economics indentured servitude approaches to health insurance, economics of index numbers international trade and heterogeneous health outcomes (economic India, economics in firms determinants) indicative planning international trade theory Heckman, James (born 1944) indirect inference Internet, economics of the Heckscher, Eli Filip (1879-1952) indirect utility function interpersonal utility comparisons Heckscher-Ohlin trade theory individual learning in games interpersonal utility comparisons (new hedging individual retirement accounts developments) hedonic prices individualism versus holism intertemporal choice Heilbroner, Robert L. (1919-2005) indivisibilities intertemporal equilibrium and Heller, Walter Perrin (1942-2001) industrial relations efficiency Heller, Walter Wolfgang (1915-1987) Industrial Revolution intrahousehold welfare Hennipman, Pieter (1911-1994) inequality between nations inventory investment Hermann, Friedrich Benedict Wilhelm inequality (global) investment decision criteria von (1795-1868) inequality (international evidence) investment (neoclassical) Herskovits, Melville Jean (1895-1963) inequality (measurement) invisible hand heterodox economics infant-industry protection involuntary unemployment heteroskedasticity and autocorrelation inflation Ireland, economics in corrections inflation dynamics iron law of wages xii List of entries A-Z irreversible investment labour economics (new perspectives) life cycle hypothesis Islamic economic institutions labour-managed firms life tables IS-LM labour market discrimination limit pricing IS-LM in modern macro labour market institutions Lindahl equilibrium lsnard, Achylle Nicolas (1749-1803) labour market search Lindahl, Erik Robert (1891-1960) Italy, economics in labour supply linear models Jaffe, William (1898-1980) labour surplus economies linear programming Japan, economics in labour theory of value linkages Jaszi, George (1915-1992) labour's share of income Lintner, John Virgil (1916--1983) J-curve Laffer curve liquidity constraints Jenkin, Henry Charles Fleeming Laffont, Jean-Jacques (1947-2004) liquidity effects, models of (1833-1885) Lagrange multipliers liquidity preference Jevons, William Stanley (1835-1882) laissez-faire, economists and liquidity trap Jewkes, John (1902-1988) Lancaster, Kelvin John (1924-1999) List, Friedrich (1789-1846) Jim Crow South land markets litigation, economics of Johansen, Leif (1930-1982) land tax Lloyd, William Forster (1794-1852) Johnson, Alvin Saunders (1874-1971) Landry, Adolphe (1874-1956) loanable funds Johnson, D. Gale (1917-2003) Lange, Oskar Ryszard (1904-1965) local public finance Johnson, Harry Gordon (1923-1977) Lardner, Dionysius (1793-1859) local regression models Johnson, William Ernest (1858-1931) large economies location theory Jones, Richard (1790-1855) large games (structural robustness) logit models of individual choice Joplin, Thomas (c. 1790-1847) Laspeyres, Ernst Louis Etienne lognormal distribution Juglar, Clement (1819-1905) (1834-1913) long memory models just price Lassalle, Ferdinand (1825-1864) long run and short run Justi, Johannn Heinrich Gottlob Von Lauderdale, Eighth Earl of [James Longfield, Mountifort (1802-1884) (1720-1771) Maitland] (1759-1839) longitudinal data analysis justice Laughlin, James Laurence (1850-1933) Lorenz curve justice (new perspectives) Launhardt, Carl Friedrich Wilhelm Losch, August (1906--1945) Kahn, Richard Ferdinand (1905-1989) (1832-1918) Lowe, Adolph (1893-1995) Kahneman, Daniel (born 1934) law of demand low-income housing policy Kain, John Forest (1935-2003) law, economic analysis of Lucas, Robert (born 1937) Kaldor, Nicholas (1908-1986) law of indifference Lucas critique Kalecki, Michal (1899-1970) Law, John (1671-1729) lump sum taxes Kalman and particle filtering law(s) of large numbers Lundberg, Erik Filip (1907-1987) Kantorovich, Leonid Vitalievich law, public enforcement of Lyapunov functions (1912-1986) layoffs machinery question Katona, George (1901-1981) Le Chatelier principle Machlup, Fritz (1902-1983) Kautsky, Karl (1854-1938) Le Trosne, Guillaume Fran.;:ois Macleod, Henry Dunning (1821-1902) kernel estimators in econometrics (1728-1780) macroeconomic effects of international Keynes, John Maynard (1883-1946) learning and evolution in games: trade Keynes, John Maynard (new adaptive heuristics macroeconomic forecasting perspectives) learning and evolution in games: an macroeconomics, origins and history of Keynes, John Neville (1852-1949) overview Maddala, G. S. (1933-1999) Keynesian revolution learning and evolution in games: belief Mahalanobis, Prasanta Chandra Keynesian ism learning (1893-1972) Kindleberger, Charles P. (1910-2003) learning and evolution in games: ESS Makower, Helen (1910-1998) King, Gregory (1648-1712) learning and information aggregation Malthus, Thomas Robert (1766--1834) kinked demand curve in networks Malthusian economy Kitchin, Joseph (1861-1932) learning-by-doing Malynes, Gerard de (fl. 1586--1623) Klein, Lawrence R. (born 1920) learning in macroeconomics Manchester School Knapp, Georg Friedrich (1842-1926) Lederer, Emil (1882-1939) mandated employer provision of Knies, Karl Gustav Adolf (1821-1898) leisure employee benefits Knight, Frank Hyneman (1885-1962) leisure class Mandel, Ernest (1923-1995) Kondratieff cycles Lenin, Vladimir llyich [Uiyanov] Mandeville, Bernard (1670-1733) Kondratieff, Nikolai Dmitrievich (1870-1924) Mangoldt, Hans Karl Emil von (1892-1938) Leontief paradox (1824-1868) Koopmans, Tjalling Charles (1910-1985) Leontief, Wassily (1906-1999) Maoist economics Korea, economics in Lerner, Abba Ptachya (1905-1982) Marcet, Jane Haldimand (1769-1858) Kravis, Irving B. (1916--1992) Leroy-Beaulieu, Pierre-Paul (1843-1916) Marget, Arthur William (1899-1962) Kuznets, Simon (1901-1985) level accounting marginal and average cost pricing Kuznets swings Lewis, W. Arthur (1915-1991) marginal productivity theory Kydland, Finn Erling (1943-) lexicographic orderings marginal revolution Kyrk, Hazel (1886-1957) liability for accidents marginal utility of money laboratory financial markets liberalism and economics market competition and selection labour discipline libertarianism market failure labour economics Lieben, Richard (1842-1919) market institutions List of entries A-Z xiii

market microstructure methodological individualism music markets, economics of market period methodology of economics Muth, John F. (1930-2005) marketplaces Metzler, Lloyd Appleton (1913-1980) Myrdal, Gunnar (1898-1987) market power and collusion in micro-credit Nash, John Forbes (born 1928) laboratory markets microfoundations Nash equilibrium, refinements of market price Mill, James (1773-1836) Nash program market structure Mill, John Stuart (1806-1873) national accounting, history of marketing boards Miller, Merton (1923-2000) National Bureau of Economic Research markets Minard, Charles Joseph (1781-1870) national income Markov chain Monte Carlo methods Mincer, Jacob (1922-2006) national system Markov equilibria in macroeconomics minimum wages natural and warranted rates of Markov processes Mirrlees, James (born 1936) growth Markowitz, Harry Max (born 1927) Mises, Ludwig Edler von (1881-1973) natural experiments and quasi-natural marriage and divorce Misselden, Edward (fl. 1608-1654) experiments marriage markets Mitchell, Wesley Clair (1874-1948) natural price Marschak. Jacob ( 1898-1977) mixed strategy equilibrium natural rate and market rate of interest Marshall, Alfred (1842-1924) mixture models natural rate of unemployment Marshall, Mary Paley (1850-1944) model averaging Navier, Louis Marie Henri (1785-1836) Marshaii-Lerner condition model selection neighbours and neighbourhoods Martineau, Harriet (1802-1876) model uncertainty Nemchinov, Vasily Sergeevich martingales models (1894-1964) Marx, Karl Heinrich (1818-1883) Modigliani, Franco (1918-2003) 'neoclassical' Marxian transformation problem Modigliani-Miller theorem neoclassical growth theory Marxian value analysis monetarism neoclassical growth theory (new Marx's analysis of capitalist production monetary aggregation perspectives) Mason, Edward Sagendorph monetary approach to the balance of neoclassical synthesis (1899-1992) payments neo-Ricardian economics Masse, Pierre (1898-1987) monetary business cycle models (sticky network formation matching prices and wages) network goods (empirical studies) matching and market design monetary business cycles (imperfect network goods (theory) matching estimators information) neuroeconomics material balances monetary cranks neutral taxation mathematical economics monetary economics, history of neutrality of money mathematical methods in political monetary and fiscal policy overview new classical macroeconomics economy monetary overhang New Deal mathematics and economics monetary policy new economic geography mathematics of networks monetary policy, history of new institutional economics maximum likelihood monetary policy rules new Keynesian macroeconomics maximum score methods monetary transmission mechanism new open economy macroeconomics Mazzola, Ugo (1863-1899) money Newcomb, Simon (1835-1909) McCulloch, John Ramsay (1789-1864) money, classical theory of Nikaido, Hukukane (1923-2001) Mcfadden, Daniel (born 1937) money and general equilibrium noise traders Meade, James Edward (1907-1995) money illusion nominal exchange rates meaningfulness and invariance money supply non-clearing markets in general Means, Gardiner Coit (1896-1988) moneylenders in developing countries equilibrium mean-variance analysis monocentric versus polycentric models non-cooperative games (equilibrium measure theory in urban economics existence) measurement monopolistic competition non-expected utility theory measurement error models monopoly non-governmental organizations measurement, theory of monopoly capitalism nonlinear panel data models mechanism design monopsony nonlinear programming mechanism design (new Moore, Henry Ludwell (1869-1958) nonlinear time series analysis developments) moral hazard non-nested hypotheses mechanism design experiments Morgenstern, Oskar (1902-1977) nonparametric structural models medieval guilds Morishima, Michio 1923-2004 non-profit organizations Menger, Carl (1840-1921) mortality non-standard analysis mercantilism motion pictures, economics of non-substitution theorems Mercier De La Riviere, Pierre-Paul multilingualism non-tariff barriers (Mercier or Lemercier) (1720-1793/4) multinational firms North American Free Trade Agreement Mercosur multiple equilibria in macroeconomics (NAFTA) merger analysis (United States) multiplier-accelerator interaction North, Douglass Cecil (born 1920) merger simulations multiplier analysis North, Dudley (1641-1691) mergers, endogenous Mun, Thomas (1571-1641) Nove, Alexander (Alec) N. (1915-1994) merit goods Mundell, Robert (born 1932) Novozhilov, Viktor Valentinovich Merton, Robert C. (born 1944) municipal bonds (1892-1970) Methodenstreit Musgrave, Richard Abel (1910-2007) numeraire xiv List of entries A-Z numerical optimization methods in peasant economy Prebisch, Raul (190 1-1986) economics pecuniary versus non-pecuniary precautionary principle Nurkse, Ragnar (1907-1959) penalties precautionary saving and nutrition and development Penrose, Edith Tilton (1914--1996) precautionary wealth nutrition and public policy in advanced pensions predatory pricing economies perfect competition prediction formulas offer curve or reciprocal demand curve perfect foresight prediction markets Ohlin, Bertil Gotthard (1899-1979) perfect information prediction market design oil and the macroeconomy period of production preference reversals Okun, Arthur M. (1928-1980) Perlman, Selig (1888-1959) Preobrazhensky, Evgenii Alexeyevich Okun's Law permanent-income hypothesis (1886-1937) oligarchs Perron-Frobenius theorem preordering oligopoly Perroux, Fran~ois (1903-1987) Prescott, Edward Christian (born 1940) Olson, Mancur (1932-1998) personnel economics present value operations research Persons, Warren Milton (1878-1937) price control opportunity cost peso problem price discrimination (empirical studies) optimal fiscal and monetary policy Petty, William (1623-1687) price discrimination (theory) (with commitment) pharmaceutical industry price dispersion optimal fiscal and monetary policy Phelps Brown, (Ernest) Henry price revolution (without commitment) (1906-1994) primary and secondary labour markets optimal tariffs Phelps, Edmund (born 1933) principal and agent (i) optimal taxation Phillips, Alban William Housego principal and agent (ii) optimality and efficiency (1914-1975) privatization optimum quantity of money Phillips curve privatization impacts in transition options Phillips curve (new views) economies options (new perspectives) philosophy and economics procurement orderings physiocracy product differentiation Oresme, Nicholas (1325-1382) Pierson, Nichlaas Gerard (1839-1909) product life cycle organic composition of capital Pigou, Arthur Cecil (1877-1959) production functions Organization of the Petroleum Pigouvian taxes profit and profit theory Exporting Countries (OPEC) planning progressive and regressive taxation Ortes, Giammaria (1713-1790) Plekhanov, Georgii Valentinovich propensity score output fall - transformational recession (1856-1918) property law, economics and overlapping generations model of pluralism in economics property rights general equilibrium Polanyi, Karl (1886-1964) property taxation Overstone, Lord [Samuel Jones Loyd] polarization proportional hazard model (1796-1883) policy reform, political economy of prospect theory Owen, Robert (1771-1858) political arithmetic protoindustrialization Palander, Tord Folkeson (1902-1972) political budget cycles psychological games Palgrave, Robert Harry Inglis political business cycles psychology of social networks (1827-1919) political competition public capital Palgrave's Dictionary of Political 'political economy' public choice Economy political institutions, economic public debt Palmer, John Horsley (1779-1858) approaches to public finance panic of 1907 pollution haven hypothesis public goods Pantaleoni, Maffeo (1857-1924) pollution permits public goods experiments paradigms Pontryagin's principle of optimality public infrastructure paradoxes and anomalies Poor Law, new public utility pricing and finance Pareto, Vilfredo (1848-1923) Poor Law, old public works Pareto distribution population ageing Pufendorf, Samuel von (1632-1694) Pareto efficiency population and agricultural growth purchasing power parity Pareto principle and competing population dynamics purification principles population health, economic quantal response equilibria partial identification in econometrics implications of quantile regression partial linear model Portugal, economics in quantity theory of money Pascal, Blaise (1623-1662) positive economics quasi-concavity patents positivism Quesnay, Fran~ois (1694-1774) patent valuation Post Keynesian economics R&D races path dependence Postan, Michael Mo·issey (1899-1981) racial profiling path dependence and occupations postmodernism radical economics path dependence in technical poverty Rae, John (1796-1872) standards poverty alleviation programmes Rae, John (1845-1915) Patinkin, Don (1922-1955) poverty lines Ramsey, Frank Plumpton (1903-1930) Patten, Simon Nelson (1852-1922) poverty traps Ramsey model payment systems power Ramsey pricing peasants power laws rational behaviour List of entries A-Z xv

rational choice and political science Robinson Crusoe self-confirming equilibria rational choice and sociology Robinson, Edward Austin Gossage Seligman, Edwin Robert Anderson rational expectations (1897-1993) (1861-1939) rational expectations models, Robinson, Joan Violet (1903-1983) Selten, Reinhard (born 1930) estimation of robust control semiparametric estimation rationality robust estimators in econometrics Sen, Amartya (born 1933) rationality, bounded Rogers, James Edwin Thorold Senior, Nassau William (1790-1864) rationality, history of the concept (1823-1890) separability rationing Roos, Charles Frederick ( 1901-1958) sequence economies Rau, Karl Heinrich (1792-1870) Roscher, Wilhelm Georg Friedrich sequential analysis Raymond, Daniel (1786-1849) (1817-1894) serial correlation and serial real balances Rosen, Sherwin (1938-2001) dependence real bills doctrine Rosenstein-Rodan, Paul Narcyz Shackle, George Lennox Sharman real bills doctrine versus the quantity (1902-1985) (1903-1992) theory Rosenthal, Robert W. (1944-2002) shadow pricing real business cycles Rostow, Walt Whitman (1916-2003) Shapley value real cost doctrine rotating saving and credit associations Shapley-Folkman theorem real exchange rates (ROSCAs) sharecropping real rigidities Rothbard, Murray N. (1926-1995) Sharpe, William F. (born 1934) real wage rates (historical trends) rotten kid theorem Shephard, Ronald William (1912-1982) realized volatility Roy model shrinkage-biased estimation in reciprocity and collective action Roy, Rene Fran~ois Joseph (1894-1977) econometrics recursive competitive equilibrium Royal Economic Society Sidgwick, Henry (1838-1900) recursive contracts Rubin causal model Sidrauski, Miguel (1939-1968) recursive preferences Ruggles, Richard (1916-2001) sieve extremum estimation redistribution of income and wealth Saint-Simon, Claude-Henri (176G-1825) signalling and screening reduced rank regression Samuelson, Paul Anthony (born 1915) silver standard regime switching models Sargan, John Denis 1924-1996 Simon, Herbert A. (1916-2001) regional and preferential trade satisficing Simons, Henry Calvert (1899-1946) agreements Sauvy, Alfred (1898-1990) Simonsen, Mario Henrique (1935-1997) regional development, geography of Savage, Leonard J. (Jimmie) simplex method for solving linear regression-discontinuity analysis (1917-1971) programs regular economies Savage's subjective expected utility simulation-based estimation regulation model simulation estimators in Reid, Margaret Gilpin (1896-1991) Sax, Emil (1845-1927) macroeconometrics religion and economic development Say, (Jean-Baptiste) Leon (1826-1896) simultaneous equations models religion, economics of Say, Jean-Baptiste (1767-1832) single tax rent Say's Law Sismondi, Jean Charles Leonard rent control Scandinavia, economics in Simonde de (1773-1842) rent seeking Schelling, Thomas C. (born 1921) size of nations, economics approach repeated games Schlesinger, Karl (1889-1938) to the reputation Schmoller, Gustav von (1838-1917) skill-biased technical change resale markets Schmookler, Jacob (1918-1967) slavery research joint ventures scholastic economics Slichter, Sumner Huber (1892-1959) reservation price and reservation Scholes, Myron (born 1941) sliding scales (wages) demand school choice and competition Slutsky, Eugen (188D-1948) residential real estate and finance Schultz, Henry (1893-1938) small-world networks residential segregation Schultz, T. W. (1902-1998) Smart, William (1853-1915) reswitching of technique Schumpeter, Joseph Alois (1883-1950) Smith, Adam (1723-1790) retirement Schumpeterian growth and growth Smith, Bruce D. (1954-2002) returns to scale policy design Smith, Vernon (born 1927) returns to scale measurement science, economics of SNP: nonparametric time series returns to schooling scientific realism and ontology analysis revealed preference theory Scitovsky, Tibor (1910-2002) social capital revelation principle Scott, William Robert (1868-1940) social choice reverse capital deepening Scrope, George Poulett (1797-1876) social choice (new developments) rhetoric of economics search-and-matching models of social contract Ricardo, David (1772-1823) monetary exchange social democracy Ricardian equivalence theorem search models of unemployment social discount rate Ricardian trade theory search theory social insurance risk search theory (new perspectives) social insurance and public policy risk aversion seasonal adjustment social interactions (empirics) risk-coping strategies second best social interactions (theory) risk sharing second economy (unofficial economy) social learning Robbins, Lionel Charles (1898-1984) seemingly unrelated regressions social multipliers Robertson, Dennis (189Q-1963) selection bias and self-selection social networks, economic relevance of xvi List of entries A-Z social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strategic trade policy Theil, Henri (1924-2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760-1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes ThOnen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout, Charles Mills (1924-1968) spatial econometrics structural unemployment time consistency of monetary and spatial economics structural vector autoregressions fiscal policy spatial market integration structuralism time preference spatial mismatch hypothesis stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943) games Tobin, James (1918-2002) Spencer, Herbert (1820-1903) superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957) 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de (1805-1859) spontaneous order surplus Tooke, Thomas (1774-1858) sports, economics of survey data, analysis of Torrens, Robert (1780-1864) spurious regressions sustainability total factor productivity Sraffa, Piero (1898-1983) Swadeshi movement Townshend, Hugh (1890-1974) Sraffian economics Swan, Trevor W. (1914-1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlor (1910-2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarbell, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880-1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph (1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xvii

Tugan-Baranovsky, Mikhail lvanovich urbanization war and economics (1865-1919) user fees Warburton, Clark (1896-1979) tulipmania Usher, Abbot Payson (1884--1965) Warming, Jens (1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus L'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred (1868-1958) two-sector models value of life Weber, Max (1864-1920) two-sided markets value of time Weintraub, Sidney (1914--1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde (1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799-1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728-1797) (1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914--1996) Wicksteed, Philip Henry (1844--1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John (1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart (1853-1914) (1885-1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore 0. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) (1885-1939) urban production externalities Walras, Leon (1834--1910) Zeuthen, Frederik Ludvig Bang urban transportation economics Walras's Law (1888-1959) THE NEWPALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

Volume 5 Lardner- network goods (theory)

Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages.

This edition published 2008 by PALGRAVE MACMILLAN Houndmills, Basingstoke, Hampshire RG21 6XS and 175 Fifth Avenue, New York, N.Y. 10010 Companies and representatives throughout the world

ISBN-13 978-0-230-22641-8 Volume 5 ISBN 978-1-349-58804-6 ISBN 978-1-349-58802-2 (eBook) DOI 10.1007/978-1-349-58802-2

A catalogue record for this book is available from the British Library.

Library of Congress Cataloging-in-Publication Data

The new Palgrave dictionary of economics I edited by Steven N. Durlauf and Lawrence E. Blume. - 2nd ed. v. em. Rev. ed. of: The New Palgrave : a dictionary of economics. 1987. Includes bibliographical references. ISBN 978-0-333-78676-5 (alk. paper)

1. Economics- Dictionaries. I. Durlauf, Steven N. II. Blume, Lawrence. Ill. New Palgrave.

HB61.N49 2008 330.03-dc22 2007047205

10 9 8 7 6 5 4 3 2 1 17 16 15 14 13 12 11 10 09 08

Typesetting and XML coding by Macmillan Publishing Solutions, Bangalore, India Contents

Publishing history Vl

List of entries A-Z Vll

The dictionary, volume 5

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis Palgrave, in three volumes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2"d edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi List of entries A-Z

Abramovitz, Moses {1912-2000) Aquinas, StThomas (1225-1274) Barton, John (1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic {1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas (1730-c1792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas {1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of {1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation {econometrics) asymmetric information behavioural genetics aggregation {production) Attwood, Thomas {1783-1856) behavioural public economics aggregation {theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram {1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy {1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram {1914-2003) agricultural research Aumann, Robert J. (born 1930) Berle, Adolf Augustus, Jr. {1895-1971) agriculture and economic development Aupetit, Albert {1876-1943) Bernacer, German {1883-1965) airline industry Auspitz, Rudolf {1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao (1952-1997) Australasia, economics in Bernstein, Eduard {1850-1932) Akerlof, George Arthur {born 1940) Austrian economics Bertrand competition Albert the Great, Saint Albertus Averch-Johnson effect Bertrand, Joseph Louis Fran~ois Magnus (c.1200-1280) Ayres, Clarence Edwin (1891-1972) (1822-1900) alienation Bachelier, Louis {1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter {1826-1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas {1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul (1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) {1876-1961) American Economic Association bandit problems bimetallism American exceptionalism Bank of England Black, Duncan {1908--1991) amortization banking crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe (1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Bohm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre le Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot (1958-2000) (1645-1714) antidumping Baran, Paul Alexander {1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas (1637/40-?1698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico {1859-1924) bootstrap Antonelli, Giovanni Battista (1858--1944) barriers to entry Borch, Karl H. {1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de {1733-1799) models (linear methods) barter in transition border effects

vii viii List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur lyon (1869-1957) central limit theorems common knowledge Boyd, Walter (1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braude), Fernand (1902-1985) Ceva, Giovanni (1647/48-1734) comparative advantage Braverman, Harry (1920-1976) Chalmers, Thomas (1780-1847) comparative statics Brentano, lujo (Ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916-1989) Chevalier, Michel (1806-1879) developments) Bruno, Michael (1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Bucher, Karl Wilhelm (1847-1930) Child, Josiah (1630-1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnot de, Abbe de Bukharin, Nikolai lvanovitch Chinese economic reforms Mureau (1714-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905-1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Franc;:ois (cl750-1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) cliometrics consumption sets capital asset pricing model clubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Coase, Ronald Harry (born 1910) contestable markets capital gains taxation Coase theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard (1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) (1855-1921) conventionalism Carlyle, Thomas (1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866-1944) collective action convexity caste system collective action (new perspectives) convict labour catallactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill (1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z ix

irreversible investment labour economics (new perspectives) life cycle hypothesis Islamic economic institutions labour-managed firms life tables IS-LM labour market discrimination limit pricing IS-LM in modern macro labour market institutions Lindahl equilibrium lsnard, Achylle Nicolas (1749-1803) labour market search Lindahl, Erik Robert (1891-1960) Italy, economics in labour supply linear models Jaffe, William {1898-1980) labour surplus economies linear programming Japan, economics in labour theory of value linkages Jaszi, George (1915-1992) labour's share of income Lintner, John Virgil {1916-1983) J-curve Laffer curve liquidity constraints Jenkin, Henry Charles Fleeming Laffont, Jean-Jacques (1947-2004) liquidity effects, models of (1833-1885) Lagrange multipliers liquidity preference Jevons, William Stanley (1835-1882) laissez-faire, economists and liquidity trap Jewkes, John (1902-1988) Lancaster, Kelvin John (1924-1999) List, Friedrich (1789-1846) Jim Crow South land markets litigation, economics of Johansen, Leif (1930-1982) land tax Lloyd, William Forster (1794-1852) Johnson, Alvin Saunders (1874-1971) Landry, Adolphe (1874-1956) loanable funds Johnson, D. Gale (1917-2003) Lange, Oskar Ryszard (1904-1965) local public finance Johnson, Harry Gordon (1923-1977) Lardner, Dionysius (1793-1859) local regression models Johnson, William Ernest (1858-1931) large economies location theory Jones, Richard (1790-1855) large games (structural robustness) logit models of individual choice Joplin, Thomas (c. 1790-1847) Laspeyres, Ernst Louis Etienne lognormal distribution Juglar, Clement (1819-1905) (1834-1913) long memory models just price Lassalle, Ferdinand (1825-1864) long run and short run Justi, Johannn Heinrich Gottlob Von Lauderdale, Eighth Earl of [James Longfield, Mountifort (1802-1884) (1720-1771) Maitland] {1759-1839) longitudinal data analysis justice Laughlin, James Laurence {1850-1933) Lorenz curve justice (new perspectives) Launhardt, Carl Friedrich Wilhelm Losch, August (1906-1945) Kahn, Richard Ferdinand (1905-1989) {1832-1918) Lowe, Adolph (1893-1995) Kahneman, Daniel (born 1934) law of demand low-income housing policy Kain, John Forest (1935-2003) law, economic analysis of Lucas, Robert (born 1937) Kaldor, Nicholas (1908-1986) law of indifference Lucas critique Kalecki, Michal (1899-1970) Law, John (1671-1729) lump sum taxes Kalman and particle filtering law(s) of large numbers Lundberg, Erik Filip (1907-1987) Kantorovich, Leonid Vitalievich law, public enforcement of Lyapunov functions (1912-1986) layoffs machinery question Katona, George (1901-1981) Le Chatelier principle Machlup, Fritz (1902-1983) Kautsky, Karl (1854-1938) Le Trosne, Guillaume Fran<:ois Macleod, Henry Dunning (1821-1902) kernel estimators in econometrics (1728-1780) macroeconomic effects of international Keynes, John Maynard (1883-1946) learning and evolution in games: trade Keynes, John Maynard (new adaptive heuristics macroeconomic forecasting perspectives) learning and evolution in games: an macroeconomics, origins and history of Keynes, John Neville (1852-1949) overview Maddala, G. S. (1933-1999) Keynesian revolution learning and evolution in games: belief Mahalanobis, Prasanta Chandra Keynesian ism learning (1893-1972) Kindleberger, Charles P. (1910-2003) learning and evolution in games: ESS Makower, Helen (1910-1998) King, Gregory {1648-1712) learning and information aggregation Malthus, Thomas Robert {1766-1834) kinked demand curve in networks Malthusian economy Kitchin, Joseph {1861-1932) learning-by-doing Malynes, Gerard de (fl. 1586-1623) Klein, Lawrence R. (born 1920) learning in macroeconomics Manchester School Knapp, Georg Friedrich (1842-1926) Lederer, Emil (1882-1939) mandated employer provision of Knies, Karl Gustav Adolf (1821-1898) leisure employee benefits Knight, Frank Hyneman (1885-1962) leisure class Mandel, Ernest {1923-1995) Kondratieff cycles Lenin, Vladimir llyich [Uiyanov] Mandeville, Bernard (1670-1733) Kondratieff, Nikolai Dmitrievich {1870-1924) Mangoldt, Hans Karl Emil von {1892-1938) Leontief paradox (1824-1868) Koopmans, Tjalling Charles {1910-1985) Leontief, Wassily (1906-1999) Maoist economics Korea, economics in Lerner, Abba Ptachya (1905-1982) Marcet, Jane Haldimand (1769-1858) Kravis, Irving B. {1916-1992) Leroy-Beaulieu, Pierre-Paul (1843-1916) Marget, Arthur William {1899-1962) Kuznets, Simon (1901-1985) level accounting marginal and average cost pricing Kuznets swings Lewis, W. Arthur {1915-1991) marginal productivity theory Kydland, Finn Erling (1943-) lexicographic orderings marginal revolution Kyr~ Hazel (1886-1957) liability for accidents marginal utility of money laboratory financial markets liberalism and economics market competition and selection labour discipline libertarianism market failure labour economics Lieben, Richard {1842-1919) market institutions List of entries A-Z xiii market microstructure methodological individualism music markets, economics of market period methodology of economics Muth, John F. (1930-2005) marketplaces Metzler, Lloyd Appleton (1913-1980) Myrdal, Gunnar (1898-1987) market power and collusion in micro-credit Nash, John Forbes (born 1928) laboratory markets microfoundations Nash equilibrium, refinements of market price Mill, James (1773-1836) Nash program market structure Mill, John Stuart (1806-1873) national accounting, history of marketing boards Miller, Merton (1923-2000) National Bureau of Economic Research markets Minard, Charles Joseph (1781-1870) national income Markov chain Monte Carlo methods Mincer, Jacob (1922-2006) national system Markov equilibria in macroeconomics minimum wages natural and warranted rates of Markov processes Mirrlees, James (born 1936) growth Markowitz, Harry Max (born 1927) Mises, Ludwig Edler von (1881-1973) natural experiments and quasi-natural marriage and divorce Misselden, Edward (fl. 1608-1654) experiments marriage markets Mitchell, Wesley Clair (1874-1948) natural price Marschak, Jacob (1898-1977) mixed strategy equilibrium natural rate and market rate of interest Marshall, Alfred (1842-1924) mixture models natural rate of unemployment Marshall, Mary Paley (1850-1944) model averaging Navier, Louis Marie Henri (1785-1836) Marshaii-Lerner condition model selection neighbours and neighbourhoods Martineau, Harriet (1802-1876) model uncertainty Nemchinov, Vasily Sergeevich martingales models (1894-1964) Marx, Karl Heinrich (1818-1883) Modigliani, Franco (1918-2003) 'neoclassical' Marxian transformation problem Modigliani-Miller theorem neoclassical growth theory Marxian value analysis monetarism neoclassical growth theory (new Marx's analysis of capitalist production monetary aggregation perspectives) Mason, Edward Sagendorph monetary approach to the balance of neoclassical synthesis (1899-1992) payments neo-Ricardian economics Masse, Pierre (1898-1987) monetary business cycle models (sticky network formation matching prices and wages) network goods (empirical studies) matching and market design monetary business cycles (imperfect network goods (theory) matching estimators information) neuroeconomics material balances monetary cranks neutral taxation mathematical economics monetary economics, history of neutrality of money mathematical methods in political monetary and fiscal policy overview new classical macroeconomics economy monetary overhang New Deal mathematics and economics monetary policy new economic geography mathematics of networks monetary policy, history of new institutional economics maximum likelihood monetary policy rules new Keynesian macroeconomics maximum score methods monetary transmission mechanism new open economy macroeconomics Mazzola, Ugo (1863-1899) money Newcomb, Simon (1835-1909) McCulloch, John Ramsay (1789-1864) money, classical theory of Nikaido, Hukukane (1923-2001) Mcfadden, Daniel (born 1937) money and general equilibrium noise traders Meade, James Edward (1907-1995) money illusion nominal exchange rates meaningfulness and invariance money supply non-clearing markets in general Means, Gardiner Coit (1896--1988) moneylenders in developing countries equilibrium mean-variance analysis monocentric versus polycentric models non-cooperative games (equilibrium measure theory in urban economics existence) measurement monopolistic competition non-expected utility theory measurement error models monopoly non-governmental organizations measurement, theory of monopoly capitalism nonlinear panel data models mechanism design monopsony nonlinear programming mechanism design (new Moore, Henry Ludwell (1869-1958) nonlinear time series analysis developments) moral hazard non-nested hypotheses mechanism design experiments Morgenstern, Oskar (1902-1977) nonparametric structural models medieval guilds Morishima, Michio 1923-2004 non-profit organizations Menger, Carl (1840-1921) mortality non-standard analysis mercantilism motion pictures, economics of non-substitution theorems Mercier De La Riviere, Pierre-Paul multilingualism non-tariff barriers (Mercier or Lemercier) (1720-1793/4) multinational firms North American Free Trade Agreement Mercosur multiple equilibria in macroeconomics (NAFTA) merger analysis (United States) multiplier-accelerator interaction North, Douglass Cecil (born 1920) merger simulations multiplier analysis North, Dudley (1641-1691) mergers, endogenous Mun, Thomas (1571-1641) Nove, Alexander (Alec) N. (1915-1994) merit goods Mundell, Robert (born 1932) Novozhilov, Viktor Valentinovich Merton, Robert C. (born 1944) municipal bonds (1892-1970) Methodenstreit Musgrave, Richard Abel (1910-2007) numeraire xiv List of entries A-Z numerical optimization methods in peasant economy Prebisch, Raul (1901-1986) economics pecuniary versus non-pecuniary precautionary principle NuriGe, Ragnar (1907-1959) penalties precautionary saving and nutrition and development Penrose, Edith Tilton (1914-1996) precautionary wealth nutrition and public policy in advanced pensions predatory pricing economies perfect competition prediction formulas offer curve or reciprocal demand curve perfect foresight prediction markets Ohlin, Bertil Gotthard (1899-1979) perfect information prediction market design oil and the macroeconomy period of production preference reversals Okun, Arthur M. (1928-1980) Perlman, Selig (1888-1959) Preobrazhensky, Evgenii Alexeyevich Okun's Law permanent-income hypothesis (1886-1937) oligarchs Perron-Frobenius theorem preordering oligopoly Perroux, Fran~ois (1903-1987) Prescott, Edward Christian (born 1940) Olson, Mancur (1932-1998) personnel economics present value operations research Persons, Warren Milton (1878-1937) price control opportunity cost peso problem price discrimination (empirical studies) optimal fiscal and monetary policy Petty, William (1623-1687) price discrimination (theory) (with commitment) pharmaceutical industry price dispersion optimal fiscal and monetary policy Phelps Brown, (Ernest) Henry price revolution (without commitment) (1906-1994) primary and secondary labour markets optimal tariffs Phelps, Edmund (born 1933) principal and agent (i) optimal taxation Phillips, Alban William Housego principal and agent (ii) optimality and efficiency (1914-1975) privatization optimum quantity of money Phillips curve privatization impacts in transition options Phillips curve (new views) economies options (new perspectives) philosophy and economics procurement orderings physiocracy product differentiation Oresme, Nicholas (1325-1382) Pierson, Nichlaas Gerard (1839-1909) product life cycle organic composition of capital Pigou, Arthur Cecil (1877-1959) production functions Organization of the Petroleum Pigouvian taxes profit and profit theory Exporting Countries (OPEC) planning progressive and regressive taxation Ortes, Giammaria (1713-1790) Plekhanov, Georgii Valentinovich propensity score output fall - transformational recession (1856-1918) property law, economics and overlapping generations model of pluralism in economics property rights general equilibrium Polanyi, Karl (1886-1964) property taxation Overstone, Lord [Samuel Jones Loyd] polarization proportional hazard model (1796-1883) policy reform, political economy of prospect theory Owen, Robert (1771-1858) political arithmetic protoindustrialization Palander, Tord Folkeson (1902-1972) political budget cycles psychological games Palgrave, Robert Harry Inglis political business cycles psychology of social networks (1827-1919) political competition public capital Palgrave's Dictionary of Political 'political economy' public choice Economy political institutions, economic public debt Palmer, John Horsley (1779-1858) approaches to public finance panic of 1907 pollution haven hypothesis public goods Pantaleoni, Maffeo (1857-1924) pollution permits public goods experiments paradigms Pontryagin's principle of optimality public infrastructure paradoxes and anomalies Poor Law, new public utility pricing and finance Pareto, Vilfredo (1848-1923) Poor Law, old public works Pareto distribution population ageing Pufendorf, Samuel von (1632-1694) Pareto efficiency population and agricultural growth purchasing power parity Pareto principle and competing population dynamics purification principles population health, economic quantal response equilibria partial identification in econometrics implications of quantile regression partial linear model Portugal, economics in quantity theory of money Pascal, Blaise (1623-1662) positive economics quasi-concavity patents positivism Quesnay, Fran~ois (1694-1774) patent valuation Post Keynesian economics R&D races path dependence Postan, Michael Mo"issey (1899-1981) racial profiling path dependence and occupations postmodernism radical economics path dependence in technical poverty Rae, John (1796-1872) standards poverty alleviation programmes Rae, John (1845-1915) Patinkin, Don (1922-1955) poverty lines Ramsey, Frank Plumpton (1903-1930) Patten, Simon Nelson (1852-1922) poverty traps Ramsey model payment systems power Ramsey pricing peasants power laws rational behaviour List of entries A-Z xv

rational choice and political science Robinson Crusoe self-confirming equilibria rational choice and sociology Robinson, Edward Austin Gossage Seligman, Edwin Robert Anderson rational expectations (1897-1993) (1861-1939) rational expectations models, Robinson, Joan Violet (1903-1983) Selten, Reinhard (born 1930) estimation of robust control semiparametric estimation rationality robust estimators in econometrics Sen, Amartya (born 1933) rationality, bounded Rogers, James Edwin Thorold Senior, Nassau William (1790-1864) rationality, history of the concept (1823-1890) separability rationing Roos, Charles Frederick (1901-1958) sequence economies Rau, Karl Heinrich (1792-1870) Roscher, Wilhelm Georg Friedrich sequential analysis Raymond, Daniel (1786-1849) (1817-1894) serial correlation and serial real balances Rosen, Sherwin (1938-2001) dependence real bills doctrine Rosenstein-Rodan, Paul Narcyz Shackle, George Lennox Sharman real bills doctrine versus the quantity (1902-1985) (1903-1992) theory Rosenthal, Robert W. (1944-2002) shadow pricing real business cycles Rostow, Walt Whitman (1916-2003) Shapley value real cost doctrine rotating saving and credit associations Shapley-Folkman theorem real exchange rates (ROSCAs) sharecropping real rigidities Rothbard, Murray N. (1926-1995) Sharpe, William F. (born 1934) real wage rates (historical trends) rotten kid theorem Shephard, Ronald William (1912-1982) realized volatility Roy model shrinkage-biased estimation in reciprocity and collective action Roy, Rene Fran~ois Joseph (1894-1977) econometrics recursive competitive equilibrium Royal Economic Society Sidgwick, Henry (1838-1900) recursive contracts Rubin causal model Sidrauski, Miguel (1939-1968) recursive preferences Ruggles, Richard (1916-2001) sieve extremum estimation redistribution of income and wealth Saint-Simon, Claude-Henri (1760-1825) signalling and screening reduced rank regression Samuelson, Paul Anthony (born 1915) silver standard regime switching models Sargan, John Denis 1924-1996 Simon, Herbert A. (1916-2001) regional and preferential trade satisficing Simons, Henry Calvert (1899-1946) agreements Sauvy, Alfred (1898-1990) Simonsen, Mario Henrique (1935-1997) regional development, geography of Savage, Leonard J. (Jimmie) simplex method for solving linear regression-discontinuity analysis (1917-1971) programs regular economies Savage's subjective expected utility simulation-based estimation regulation model simulation estimators in Reid, Margaret Gilpin (1896--1991) Sax, Emil (1845-1927) macroeconometrics religion and economic development Say, (Jean-Baptiste) Leon (1826--1896) simultaneous equations models religion, economics of Say, Jean-Baptiste (1767-1832) single tax rent Say's Law Sismondi, Jean Charles Leonard rent control Scandinavia, economics in Simonde de (1773-1842) rent seeking Schelling, Thomas C. (born 1921) size of nations, economics approach repeated games Schlesinger, Karl (1889-1938) to the reputation Schmoller, Gustav von (1838-1917) skill-biased technical change resale markets Schmookler, Jacob (1918-1967) slavery research joint ventures scholastic economics Slichter, Sumner Huber (1892-1959) reservation price and reservation Scholes, Myron (born 1941) sliding scales (wages) demand school choice and competition Slutsky, Eugen (1880-1948) residential real estate and finance Schultz, Henry (1893-1938) small-world networks residential segregation Schultz, T. W. (1902-1998) Smart, William (1853-1915) reswitching of technique Schumpeter, Joseph Alois (1883-1950) Smith, Adam (1723-1790) retirement Schumpeterian growth and growth Smith, Bruce D. (1954-2002) returns to scale policy design Smith, Vernon (born 1927) returns to scale measurement science, economics of SNP: nonparametric time series returns to schooling scientific realism and ontology analysis revealed preference theory Scitovsky, Tibor (1910-2002) social capital revelation principle Scott, William Robert (1868-1940) social choice reverse capital deepening Scrape, George Paulett (1797-1876) social choice (new developments) rhetoric of economics search-and-matching models of social contract Ricardo, David (1772-1823) monetary exchange social democracy Ricardian equivalence theorem search models of unemployment social discount rate Ricardian trade theory search theory social insurance risk search theory (new perspectives) social insurance and public policy risk aversion seasonal adjustment social interactions (empirics) risk-coping strategies second best social interactions (theory) risk sharing second economy (unofficial economy) social learning Robbins, lionel Charles (1898-1984) seemingly unrelated regressions social multipliers Robertson, Dennis (1890-1963) selection bias and self-selection social networks, economic relevance of xvi List of entries A-Z social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strategic trade policy Theil, Henri (1924--2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760-1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes Thiinen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout, Charles Mills (1924--1968) spatial econometrics structural unemployment time consistency of monetary and spatial economics structural vector autoregressions fiscal policy spatial market integration structuralism time preference spatial mismatch hypothesis stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943) games Tobin, James (1918-2002) Spencer, Herbert (1820-1903) superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957) 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de (1805-1859) spontaneous order surplus Tooke, Thomas (1774--1858) sports, economics of survey data, analysis of Torrens, Robert (1780-1864) spurious regressions sustainability total factor productivity Sraffa, Piero (1898-1983) Swadeshi movement Townshend, Hugh (1890-1974) Sraffian economics Swan, Trevor W. (1914--1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlar (1910-2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarbell, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880-1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph (1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xvii

Tugan-Baranovsky, Mikhail lvanovich urbanization war and economics (1865--1919) user fees Warburton, Clark (1896-1979) tulipmania Usher, Abbot Payson (1884--1965) Warming, Jens (1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus L'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred (1868-1958) two-sector models value of life Weber, Max (1864--1920) two-sided markets value of time Weintraub, Sidney (1914-1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde (1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799-1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728-1797) (1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914--1996) Wicksteed, Philip Henry (1844--1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John (1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart (1853-1914) (1885--1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore 0. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) (1885--1939) urban production externalities Walras, Leon (1834--1910) Zeuthen, Frederik Ludvig Bang urban transportation economics Walras's Law (1888-1959) THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

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The new Palgrave dictionary of economics / edited by Steven N. Durlauf and Lawrence E. Blume. - 2nd ed. v. cm. Rev. ed. of: The New Palgrave: a dictionary of economics. 1987. Includes bibliographical references. ISBN 978-0-333-78676-5 (alk. paper)

1. Economics - Dictionaries. I. Durlauf, Steven N. II. Blume, Lawrence. III. New Palgrave.

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Publishing history VI

List of entries A-Z VB

The dictionary, volume 6

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis PaIgrave, in three volumes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2nd edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi List of entries A-Z

Abramovitz, Moses (1912-2000) Aquinas, St Thomas (1225-1274) Barton, John (1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic (1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas (1730-cl792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas (1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of (1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation (econometrics) asymmetric information behavioural genetics aggregation (production) Attwood, Thomas (1783-1856) behavioural public economics aggregation (theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram (1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy (1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram (1914-2003) agricultural research Aumann, Robert J. (born 1930) Berle, Adolf Augustus, Jr. (1895-1971) agriculture and economic development Aupetit, Albert (1876--1943) Bernacer, German (1883-1965) airline industry Auspitz, Rudolf (1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao (1952-1997) Australasia, economics in Bernstein, Eduard (1850-1932) Akerlof, George Arthur (born 1940) Austrian economics Bertrand competition Albert the Great, Saint Albertus Averch-Johnson effect Bertrand, Joseph Louis Fran~ois Magnus (c.1200-1280) Ayres, Clarence Edwin (1891-1972) (1822-1900) alienation Bachelier, Louis (1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter (1826--1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas (1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul (1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) (1876--1961) American Economic Association bandit problems bimetallism American exceptionalism Bank of England Black, Duncan (1908-1991) amortization banking crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe (1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Bohm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre Ie Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot (1958-2000) (1645-1714) antidumping Baran, Paul Alexander (1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas (1637/40-?l698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico (1859-1924) bootstrap Antonelli, Giovanni Battista (1858-1944) barriers to entry Borch, Karl H. (1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de (1733-1799) models (linear methods) barter in transition border effects

vii viii List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur lyon (1869-1957) central limit theorems common knowledge Boyd, Walter (1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braude!, Fernand (1902-1985) Ceva, Giovanni (1647/48--1734) comparative advantage Braverman, Harry (1920-1976) Chalmers, Thomas (1780-1847) comparative statics Brentano, lujo (ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916-1989) Chevalier, Michel (1806-1879) developments) Bruno, Michael (1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Bucher, Karl Wilhelm (1847-1930) Child, Josiah (1630-1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnot de, Abbe de Bukharin, Nikolai Ivanovitch Chinese economic reforms Mureau (17l4-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905-1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Fran~ois (c1750-1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) cliometrics consumption sets capital asset pricing model clubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Coase, Ronald Harry (born 1910) contestable markets capital gains taxation Coase theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard (1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) (1855-1921) conventionalism Carlyle, Thomas (1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866-1944) collective action convexity caste system collective action (new perspectives) convict labour catallactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill (1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z ix

gravity equation Hicks, John Richard (1904--1989) inflation expectations gravity models Hicks, Ursula Kathleen (1896-1985) inflation measurement Great Depression Hicksian and Marshallian demands inflation targeting Great Depression (mechanisms) hierarchical Bayes models informal economy Great Depression, monetary and hierarchy information aggregation and prices financial forces in Hildebrand, Bruno (1812-1878) information cascade experiments Great Divide Hilferding, Rudolf (1877-1941) information cascades green national accounting Hill, Polly (1914--2005) information sharing among firms Gresham, Thomas (c1519-1579) Hirshleifer, Jack (1926-2005) information technology and the world Gresham's Law historical demography economy Griliches, Zvi (1930--1999) historical economics, British Ingram, John Kells (1823-1907) gross substitutes Historical School, German inheritance and bequests Grossman, Herschel I. (1939-2004) history of economic thought Innis, Harold Adams (1894--1952) Grotius (de Groot), Hugo (1583-1645) Hobson, John Atkinson (1858-1940) input-output analysis group selection hold-up problem inside and outside money growth accounting home production insider trading growth and civil war homogeneous and homothetic institutional economics growth and cycles functions institutional trap growth and inequality (macro horizontal and vertical equity institutionalism, old perspectives) Hotelling, Harold (1895-1973) instrumentalism and operationalism growth and institutions hours worked (long-run trends) instrumental variables growth and international trade household portfolios insurance mathematics growth and learning-by-doing household production and public intangible capital growth models, multisector goods integrability of demand growth take-offs household surveys intellectual property Haavelmo, Trygve (1911-1999) housing policy in the United States intellectual property, history of Habakkuk, John Hrothgar (1915-2002) housing supply interacting agents in finance Haberler, Gottfried (1900--1995) human capital interdependent preferences habit persistence human capital, fertility and growth interest rates Hadley, Arthur Twining (1856-1930) Hume, David (1711-1776) intergenerational income mobility Hagen, Everett Einar (1906-1993) hunters, gatherers, cities and evolution intergenerational transmission Hamilton, Alexander (1755-1804) hunting and gathering economies intergovernmental grants Hamiltonians Hutcheson, Francis (1694--1746) internal economies Hannan, Edward J. (1921-1994) hyperinflation internal migration Hansen, Alvin (1887-1975) ideal output internal rate of return happiness, economics of identification international capital flows Harris, Seymour Edwin (1897-1975) identity international economics, history of Harris-Todaro hypothesis immigration and the city international finance Harrod, Roy Forbes (1900--1978) immiserizing growth international financial institutions (lFls) Harsanyi, John C. (1920--2000) implicit contracts international migration Hart, Albert Gailord (1909-1997) impulse response function International Monetary Fund Hawkins-Simon conditions imputation international monetary institutions Hawley, Frederick Barnard (1843-1929) incentive compatibility international outsourcing Hawtrey, Ralph George (1879-1975) income mobility international policy coordination Hayek, Friedrich August von income taxation and optimal policies international real business cycles (1899-1992) incomplete contracts international reserves hazardous waste, economics of incomplete markets international trade, empirical health economics indentured servitude approaches to health insurance, economics of index numbers international trade and heterogeneous health outcomes (economic India, economics in firms determinants) indicative planning international trade theory Heckman, James (born 1944) indirect inference Internet. economics of the Heckscher, Eli Filip (1879-1952) indirect utility function interpersonal utility comparisons Heckscher-Ohlin trade theory individual learning in games interpersonal utility comparisons (new hedging individual retirement accounts developments) hedonic prices individualism versus holism intertemporal choice Heilbroner, Robert L. (1919-2005) indivisibilities intertemporal equilibrium and Heller, Walter Perrin (1942-2001) industrial relations efficiency Heller, Walter Wolfgang (1915-1987) Industrial Revolution intra household welfare Hennipman, Pieter (1911-1994) inequality between nations inventory investment Hermann, Friedrich Benedict Wilhelm inequality (global) investment decision criteria von (1795-1868) inequality (international evidence) investment (neoclassical) Herskovits, Melville Jean (1895-1963) inequality (measurement) invisible hand heterodox economics infant-industry protection involuntary unemployment heteroskedasticity and autocorrelation inflation Ireland, economics in corrections inflation dynamics iron law of wages xii List of entries A-Z

rational choice and political science Robinson Crusoe self-confirming equilibria rational choice and sociology Robinson, Edward Austin Gossage Seligman, Edwin Robert Anderson rational expectations (1897-1993) (1861-1939) rational expectations models, Robinson, Joan Violet (1903-1983) Selten, Reinhard (born 1930) estimation of robust control semiparametric estimation rationality robust estimators in econometrics Sen, Amartya (born 1933) rationality, bounded Rogers, James Edwin Thorold Senior, Nassau William (1790-1864) rationality, history of the concept (1823-1890 ) separability rationing Roos, Charles Frederick (1901-1958) sequence economies Rau, Karl Heinrich (1792-1870) Roscher, Wilhelm Georg Friedrich sequential analysis Raymond, Daniel 0786-1849) (1817-1894) serial correlation and serial real balances Rosen, Sherwin (1938-2001) dependence real bills doctrine Rosenstein-Rodan, Paul Narcyz Shackle, George Lennox Sharman real bills doctrine versus the quantity (1902-1985) (1903-1992 ) theory Rosenthal, Robert W. (1944-2002) shadow pricing real business cycles Rostow, Walt Whitman (1916-2003) Shapley value real cost doctrine rotating saving and credit associations Shapley-Folkman theorem real exchange rates (ROSCAs) sharecropping real rigidities Rothbard, Murray N. (1926-1995) Sharpe, William F. (born 1934) real wage rates (historical trends) rotten kid theorem Shephard, Ronald William (1912-1982) realized volatility Roy model shrinkage-biased estimation in reciprocity and collective action Roy, Rene Franl=ois Joseph (1894-1977) econometrics recursive competitive equilibrium Royal Economic Society Sidgwick, Henry (1838-1900) recursive contracts Rubin causal model Sidrauski, Miguel (1939-1968) recursive preferences Ruggles, Richard (1916-2001) sieve extremum estimation redistribution of income and wealth Saint-Simon, Claude-Henri (1760-1825) signalling and screening reduced rank regression Samuelson, Paul Anthony (born 1915) silver standard regime switching models Sargan, John Denis 1924-1996 Simon, Herbert A. (1916-2001) regional and preferential trade satisficing Simons, Henry Calvert (1899-1946) agreements Sauvy, Alfred (1898-1990) Simonsen, Mario Henrique (1935-1997) regional development, geography of Savage, Leonard J. (Jimmie) simplex method for solving linear regression-discontinuity analysis (1917-1971) programs regular economies Savage's subjective expected utility simulation-based estimation regulation model simulation estimators in Reid, Margaret Gilpin (1896-1991) Sax, Emil (1845-1927) macroeconometrics religion and economic development Say, (Jean-Baptiste) Leon (1826-1896) simultaneous equations models religion, economics of Say, Jean-Baptiste (1767-1832) single tax rent Say's Law Sismondi, Jean Charles Leonard rent control Scandinavia, economics in Simonde de (1773-1842) rent seeking Schelling, Thomas C. (born 1921) size of nations, economics approach repeated games Schlesinger, Karl (1889-1938) to the reputation Schmoller, Gustav von (1838-1917) skill-biased technical change resale markets Schmookler, Jacob (1918-1967) slavery research joint ventures scholastic economics Slichter, Sumner Huber (1892-1959) reservation price and reservation Scholes, Myron (born 1941) sliding scales (wages) demand school choice and competition Slutsky, Eugen (1880-1948) residential real estate and finance Schultz, Henry (1893-1938) small-world networks residential segregation Schultz, T. W. (1902-1998) Smart, William (1853-1915) reswitching of technique Schumpeter, Joseph Alois (1883-1950) Smith, Adam (1723-1790) retirement Schumpeterian growth and growth Smith, Bruce D. (1954-2002) returns to scale policy design Smith, Vernon (born 1927) returns to scale measurement science, economics of SNP: non parametric time series returns to schooling scientific realism and ontology analysis revealed preference theory Scitovsky, Tibor (1910-2002) social capital revelation principle Scott, William Robert (1868-1940) social choice reverse capital deepening Scrope, George Poulett (1797-1876) social choice (new developments) rhetoric of economics search-and-matching models of social contract Ricardo, David (1772-1823) monetary exchange social democracy Ricardian equivalence theorem search models of unemployment social discount rate Ricardian trade theory search theory social insurance risk search theory (new perspectives) social insurance and public policy risk aversion seasonal adjustment social interactions (empirics) risk-coping strategies second best social interactions (theory) risk sharing second economy (unofficial economy) social learning Robbins, Lionel Charles (1898-1984) seemingly unrelated regressions social multipliers Robertson, Dennis (1890-1963) selection bias and self-selection social networks, economic relevance of xvi List of entries A-Z social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strategic trade policy Theil, Henri (1924-2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760-1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes Thunen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850 ) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout. Charles Mills (1924-1968) spatial econometrics structural unemployment time consistency of monetary and spatial economics structural vector autoregressions fiscal policy spatial market integration structuralism time preference spatial mismatch hypothesis stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943) games Tobin, James (1918-2002) Spencer, Herbert (1820-1903) superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957) 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de (1805-1859) spontaneous order surplus Tooke, Thomas (1774-1858) sports, economics of survey data, analysis of Torrens, Robert (1780-1864) spurious regressions sustainability total factor productivity Sraffa, Piero (1898-1983) Swadeshi movement Townshend, Hugh (1890-1974) Sraffian economics Swan, Trevor W. (1914-1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlor (1910-2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarbell, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880-1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph (1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xvii

Tugan-Baranovsky, Mikhail Ivanovich urbanization war and economics (1865-1919) user fees Warburton, Clark (1896-1979) tulipmania Usher, Abbot Payson (1884-1965) Warming, Jens (1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus l'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred (1868-1958) two-sector models value of life Weber, Max (1864-1920) two-sided markets value of time Weintraub, Sidney (1914-1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde (1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799-1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728-1797) (1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914-1996) Wicksteed, Philip Henry (1844-1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John (1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart (1853-1914) (1885-1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore O. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) (1885-1939) urban production externalities Walras, leon (1834-1910) Zeuthen, Frederik ludvig Bang urban transportation economics Walras's law (1888-1959) THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

Volume 7 real balances - stochastic volatility models

Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages.

This edition published 2008 by PALGRAVE MACMILLAN Houndmills, Basingstoke, Hampshire RG21 6XS and 175 Fifth Avenue, New York, N.Y. 10010 Companies and representatives throughout the world

ISBN-13 978-0-230-22643-2 Volume 7

ISBN 978-1-349-58804-6 ISBN 978-1-349-58802-2 (eBook) DOI 10.1007/978-1-349-58802-2

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The new Palgrave dictionary of economics / edited by Steven N. Durlauf and Lawrence E. Blume. - 2nd ed. v. cm. Rev. ed. of: The New Palgrave : a dictionary of economics. 1987. Includes bibliographical references. 1. Economics - Dictionaries. I. Durlauf, Steven N. II. Blume, Lawrence. III. New Palgrave.

HB61.N492008 330.03-dc22 2007047205

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Typesetting and XML coding by Macmillan Publishing Solutions, Bangalore, India Contents

Publishing history VI

List of entries A-Z VB

The dictionary, volume 7

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis Palgrave, in three volumes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2nd edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi List of entries A-Z

Abramovitz, Moses (1912-2000) Aquinas, St Thomas (1225-1274) Barton, John (1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic (1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas (1730-cl792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas (1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of (1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation (econometrics) asymmetric information behavioural genetics aggregation (production) Attwood, Thomas (1783-1856) behavioural public economics aggregation (theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram (1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy (1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram (1914-2003) agricultural research Aumann, Robert J. (born 1930) Berle, Adolf Augustus, Jr. (1895-1971) agriculture and economic development Aupetit, Albert (1876-1943) Bernacer, German (1883-1965) airline industry Auspitz, Rudolf (1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao (1952-1997) Australasia, economics in Bernstein, Eduard (1850-1932) Akerlof, George Arthur (born 1940) Austrian economics Bertrand competition Albert the Great, Saint Albertus Averch-Johnson effect Bertrand, Joseph Louis Fran~ois Magnus (c.1200-1280) Ayres, Clarence Edwin (1891-1972) (I 822-1900) alienation Bachelier, Louis (1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter (1826-1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas (1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul (1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) (1876-1961) American Economic Association bandit problems bimetallism American exceptional ism Bank of England Black, Duncan (1908-1991) amortization banking crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe (1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Bohm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre Ie Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot (1958-2000) (1645-1714) antidumping Baran, Paul Alexander (1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas (1637/40-?l698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico (1859-1924) bootstrap Antonelli, Giovanni Battista (1858-1944) barriers to entry Borch, Karl H. (1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de (1733-1799) models (linear methods) barter in transition border effects

vii viii List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur Lyon (1869-1957) central limit theorems common knowledge Boyd, Walter (1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braudel, Fernand (1902-1985) Ceva, Giovanni (1647/48-1734) comparative advantage Braverman, Harry (1920-1976) Chalmers, Thomas (1780-1847) comparative statics Brentano, Lujo (Ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916-1989) Chevalier, Michel (1806-1879) developments) Bruno, Michael (1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Bucher, Karl Wilhelm (1847-1930) Child, Josiah (1630-1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnot de, Abbe de Bukharin, Nikolai Ivanovitch Chinese economic reforms Mureau (17l4-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905-1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Fran~ois (cl750-1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) cliometrics consumption sets capital asset pricing model clubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Coase, Ronald Harry (born 1910) contestable markets capital gains taxation Coase theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard (1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) (1855-1921) conventionalism Carlyle, Thomas (1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866-1944) collective action convexity caste system collective action (new perspectives) convict labour cata lIactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill (1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z ix

rational choice and political science Robinson Crusoe self-confirming equilibria rational choice and sociology Robinson, Edward Austin Gossage Seligman, Edwin Robert Anderson rational expectations (1897-1993) (1861-1939) rational expectations models, Robinson, Joan Violet (1903-1983) Selten, Reinhard (born 1930) estimation of robust control semiparametric estimation rationality robust estimators in econometrics Sen, Amartya (born 1933) rationality, bounded Rogers, James Edwin Thorold Senior, Nassau William (1790-1864) rationality, history of the concept (1823-1890 ) separability rationing Roos, Charles Frederick (1901-1958) sequence economies Rau, Karl Heinrich (1792-1870) Roscher, Wilhelm Georg Friedrich sequential analysis Raymond, Daniel (1786-1849) (1817-1894) serial correlation and serial real balances Rosen, Sherwin (1938-2001) dependence real bills doctrine Rosenstein-Rodan, Paul Narcyz Shackle, George Lennox Sharman real bills doctrine versus the quantity (1902-1985 ) (1903-1992) theory Rosenthal, Robert W. (1944-2002) shadow pricing real business cycles Rostow, Walt Whitman (1916-2003) Shapley value real cost doctrine rotating saving and credit associations Shapley-Folkman theorem real exchange rates (ROSCAs) sharecropping real rigidities Rothbard, Murray N. (1926-1995) Sharpe, William F. (born 1934) real wage rates (historical trends) rotten kid theorem Shephard, Ronald William (1912-1982) realized volatility Roy model shrinkage-biased estimation in reciprocity and collective action Roy, Rene Fran~ois Joseph (1894-1977) econometrics recursive competitive equilibrium Royal Economic Society Sidgwick, Henry (1838-1900) recursive contracts Rubin causal model Sidrauski, Miguel (1939-1968) recursive preferences Ruggles, Richard (1916-2001) sieve extremum estimation redistribution of income and wealth Saint-Simon, Claude-Henri (1760-1825) signalling and screening reduced rank regression Samuelson, Paul Anthony (born 1915) silver standard regime switching models Sargan, John Denis 1924-1996 Simon, Herbert A. (1916-2001) regional and preferential trade satisficing Simons, Henry Calvert (1899-1946) agreements Sauvy, Alfred (1898-1990) Simonsen, Mario Henrique (1935-1997) regional development, geography of Savage, Leonard J. (Jimmie) simplex method for solving linear regression-discontinuity analysis (1917-1971) programs regular economies Savage's subjective expected utility simulation-based estimation regulation model simulation estimators in Reid, Margaret Gilpin (1896-1991) Sax, Emil (1845-1927) macroeconometrics religion and economic development Say, (Jean-Baptiste) Leon (1826-1896) simultaneous equations models religion, economics of Say, Jean-Baptiste (1767-1832) single tax rent Say's Law Sismondi, Jean Charles Leonard rent control Scandinavia, economics in Simonde de (1773-1842) rent seeking Schelling, Thomas C. (born 1921) size of nations, economics approach repeated games Schlesinger, Karl (1889-1938) to the reputation Schmoller, Gustav von (1838-1917) skill-biased technical change resale markets Schmookler, Jacob (1918-1967) slavery research joint ventures scholastic economics Slichter, Sumner Huber (1892-1959) reservation price and reservation Scholes, Myron (born 1941) sliding scales (wages) demand school choice and competition Slutsky, Eugen (1880-1948) residential real estate and finance Schultz, Henry (1893-1938) small-world networks residential segregation Schultz, T. W. (1902-1998) Smart, William (1853-1915) reswitching of technique Schum peter, Joseph Alois (1883-1950) Smith, Adam (1723-1790) retirement Schumpeterian growth and growth Smith, Bruce D. (1954-2002) returns to scale policy design Smith, Vernon (born 1927) returns to scale measurement science, economics of SNP: non parametric time series returns to schooling scientific realism and ontology analysis revealed preference theory Scitovsky, Tibor (1910-2002) social capital revelation principle Scott, William Robert (1868-1940) social choice reverse capital deepening Scrope, George Poulett (1797-1876) social choice (new developments) rhetoric of economics search-and-matching models of social contract Ricardo, David (1772-1823) monetary exchange social democracy Ricardian equivalence theorem search models of unemployment social discount rate Ricardian trade theory search theory social insurance risk search theory (new perspectives) social insurance and public policy risk aversion seasonal adjustment social interactions (empirics) risk-coping strategies second best social interactions (theory) risk sharing second economy (unofficial economy) social learning Robbins, Lionel Charles (1898-1984) seemingly unrelated regressions social multipliers Robertson, Dennis (1890-1963) selection bias and self-selection social networks, economic relevance of xvi List of entries A-Z social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strategic trade policy Theil, Henri (1924-2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760-1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes Thunen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout, Charles Mills (1924-1968) spatial econometrics structural unemployment time consistency of monetary and spatial economics structural vector autoregressions fiscal policy spatial market integration structuralism time preference spatial mismatch hypothesis stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943) games Tobin, James (1918-2002) Spencer, Herbert (1820-1903) superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957) 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de (1805-1859) spontaneous order surplus Tooke, Thomas (1774-1858) sports, economics of survey data, analysis of Torrens, Robert (1780-1864) spurious regressions sustainability total factor productivity Sraffa, Piero (1898-1983) Swadeshi movement Townshend, Hugh (1890-1974) Sraffian economics Swan, Trevor W. (1914-1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlor (1910-2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarbell, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880-1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph (1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xvii

Tugan-Baranovsky, Mikhail Ivanovich urbanization war and economics (1865-1919 ) user fees Warburton, Clark (1896-1979) tulipmania Usher, Abbot Payson (1884-1965) Warming, Jens (1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus l'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred (1868-1958) two-sector models value of life Weber, Max (1864--1920) two-sided markets value of time Weintraub, Sidney (1914--1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde (1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799-1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728-1797) (1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914--1996) Wicksteed, Philip Henry (1844-1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John (1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart (1853-1914) (1885-1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore O. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) (1885-1939) urban production externalities Walras, leon (1834-1910) Zeuthen, Frederik ludvig Bang urban transportation economics Walras's law (1888-1959 ) THENEWPALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION THE NEW PALGRAVE DICTIONARY OF ECONOMICS SECOND EDITION Edited by Steven N. Durlauf and Lawrence E. Blume

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The new Palgrave dictionary of economics / edited by Steven N. Durlauf and Lawrence E. Blume. - 2nd ed. v. cm. Rev. ed. of: The New Palgrave : a dictionary of economics. 1987. Includes bibliographical references. ISBN 978-0-333-78676-5 (alk. paper)

1. Economics - Dictionaries. I. Durlauf, Steven N. II. Blume, Lawrence. III. New Palgrave.

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Typesetting and XML coding by Macmillan Publishing Solutions, Bangalore, India Contents

Publishing history VI

List of entries A-Z Vll

The dictionary, volume 8

Appendix I Entries in The New Palgrave Dictionary of Economics, 2nd Edition, by Author 804

Appendix II Entries in The New Palgrave: A Dictionary of Economics, 1987 by Author 826

Appendix III Entries in Palgrave's Dictionary of Political Economy, by Author 844

Appendix IV Subject index 854

Index 870

v Publishing history

First edition of Dictionary of Political Economy, edited by Robert Harry Inglis Palgrave, in three volwnes:

Volume I, printed 1894. Reprinted pages 1-256 with corrections, 1901, 1909. Reprinted with corrections, 1915, 1919.

Volume II, printed 1896. Reprinted 1900. Reprinted with corrections, 1910, 1915.

Volume III, printed 1899. Reprinted 1901. Corrected with appendix, 1908. Reprinted with corrections, 1910, 1913. Reprinted, 1918.

New edition, retitled Palgrave's Dictionary of Political Economy, edited by Henry Higgs, in three volumes:

Volume I, printed 1925. Reprinted 1926.

Volume II, printed 1923. Reprinted 1925, 1926.

Volume III, printed February 1926. Reprinted May 1926.

The New Palgrave: A Dictionary of Economics, edited by John Eatwell, Murray Milgate and Peter Newman. Published in four volumes.

First published 1987. Reprinted 1988 (twice). Reprinted with corrections 1991. Reprinted 1994, 1996.

First published in paperback 1998. Reprinted 1999, 2003, 2004.

The New Palgrave Dictionary of Economics 2nd edition, edited by Steven N. Durlauf and Lawrence E. Blume. Published in eight volumes

vi List of entries A-Z

Abramovitz, Moses (1912-2000) Aquinas, St Thomas (1225-1274) Barton, John (1789-1852) absolute and exchangeable value arbitrage Bastiat, Claude Frederic (1801-1850) absorption approach to the balance of arbitrage pricing theory Baudeau, Nicolas (1730-c1792) payments ARCH models Bauer, Peter Thomas (1915-2002) acceleration principle arms races Bayes, Thomas (1702-1761) access to land and development arms trade Bayesian econometrics accounting and economics Arndt, Heinz Wolfgang (1915-2002) Bayesian methods in adaptive estimation arrears macroeconometrics adaptive expectations Arrow-Debreu model of general Bayesian nonparametrics addiction equilibrium Bayesian statistics adjustment costs Arrow, Kenneth Joseph (born 1921) Bayesian time series analysis adverse selection Arrow's theorem Beccaria, Cesare Bonesana, Marchese di advertising art, economics of (1738-1794) affine term structure models artificial neural networks Becker, Gary S. (born 1930) affirmative action artificial regressions behavioural economics and game agency problems assets and liabilities theory agent-based models assortative matching behavioural finance aggregate demand theory assumptions controversy behavioural game theory aggregation (econometrics) asymmetric information behavioural genetics aggregation (production) Attwood, Thomas (1783-1856) behavioural public economics aggregation (theory) auctioneer Bellman equation agricultural economics auctions (applications) Ben Porath, Yoram (1937-1992) agricultural finance auctions (empirics) Bentham, Jeremy (1748-1832) agricultural markets in developing auctions (experiments) bequests and the life cycle model countries auctions (theory) Bergson, Abram (1914-2003) agricultural research Aumann, Robert J. (born 1930) Berle, Adolf Augustus, Jr. (1895-1971) agriculture and economic development Aupetit, Albert (1876-1943) Bernacer, German (1883-1965) airline industry Auspitz, Rudolf (1837-1906) Bernoulli, Daniel (1700-1782) Aiyagari, S. Rao (1952-1997) Australasia, economics in Bernstein, Eduard (1850-1932) Akerlof, George Arthur (born 1940) Austrian economics Bertrand competition Albert the Great, Saint Albertus Averch-Johnson effect Bertrand, Joseph louis Fran(:ois Magnus (c.1200-1280) Ayres, Clarence Edwin (1891-1972) (1822-1900) alienation Bachelier, louis (1870-1946) Beveridge curve Allais, Maurice (born 1911) Bagehot, Walter (1826-1877) Beveridge, William Henry (1879-1963) Allais paradox Bailey, Samuel (1791-1870) bias correction Allen, Roy George Douglas (1906-1983) Bain, Joe Staten (1912-1991) biased and unbiased technological altruism, history of the concept Bairoch, Paul (1930-1999) change altruism in experiments balanced growth Bickerdike, Charles Frederick ambiguity and ambiguity aversion Balassa, Bela (1928-1991) (1876-1961) American Economic Association bandit problems bimetallism American exceptionalism Bank of England Black, Duncan (1908-1991) amortization ba n ki ng crises Black, Fischer (1938-1995) analogy and metaphor banking industry black-white labour market inequality Anderson, Oskar Nikolayevich Banking School, Currency School, Free in the United States (1887-1960) Banking School Blanqui, Jerome-Adolphe (1798-1854) Ando, Albert K. (1929-2002) bankruptcy, economics of Bodin, Jean (1530-1596) animal spirits bankruptcy law, economics of Bohm-Bawerk, Eugen von (1851-1914) anthropometric history corporate and personal Boisguilbert, Pierre Ie Pesant, Sieur de anti-discrimination law Banks, Jeffrey Scot (1958-2000) (1645-l7l4) antidumping Baran, Paul Alexander (1910-1964) Bondareva, Olga (1937-1991) anti-poverty programmes in the United Barbon, Nicholas (1637/40-11698) bonds States bargaining books, economics of antitrust enforcement Barone, Enrico (1859-1924) bootstrap Antonelli, Giovanni Battista (1858-1944) barriers to entry Borch, Karl H. (1919-1986) approximate solutions to dynamic barter Borda, Jean-Charles de (1733-1799) models (linear methods) barter in transition border effects

vii viii List of entries A-Z

Bouniatian, Mentor (1877-1969) central banking common factors Bowley, Arthur Lyon (1869-1957) central limit theorems common knowledge Boyd, Walter (1754-1837) central place theory common property resources Bradford, David (1939-2005) certainty equivalence common rights in land Brady, Dorothy Stahl (1903-1977) CES production function Commons, John Rogers (1862-1945) brain drain ceteris paribus community indifference curves Braudel, Fernand (1902-1985) Ceva, Giovanni (1647/48-1734) comparative advantage Braverman, Harry (1920-1976) Chalmers, Thomas (1780-1847) comparative statics Brentano, Lujo (Ludwig Josef) Chamberlin, Edward Hastings compensating differentials (1844-1931) (1899-1967) compensation principle Bresciani-Turroni, Costantino Champernowne, David Gawen competing risks model (1882-1963) (1912-2000) competition Bretton Woods system chaotic dynamics in economics competition and selection bribery charitable giving competition, Austrian Bright, John (1811-89) cheap talk competition, classical Britain, economics in (20th century) chemical industry computation of general equilibria British classical economics Chenery, Hollis B. (1918-1994) computation of general equilibria (new Brunner, Karl (1916-1989) Chevalier, Michel (1806-1879) developments) Bruno, Michael (1932-1996) Chicago School computational methods in bubbles Chicago School (new perspectives) econometrics bubbles in history child health and mortality computer industry Buchanan, James M. (born 1919) child labour computer science and game theory Bucher, Karl Wilhelm (1847-1930) Child, Josiah (1630-1699) computing in mechanism design budget deficits childcare concentration measures budget projections China, economics in Condillac, Etienne Bonnot de, Abbe de Bukharin, Nikolai Ivanovitch Chinese economic reforms Mureau (1714-1780) (1888-1938) Christaller, Walter (1894-1975) Condorcet, Marie Jean Antoine Nicolas bullionist controversies (empirical circular flow Caritat, Marquis de (1743-1794) evidence) circulating capital congestion bundling and tying city and economic development conjectural equilibria bureaucracy Clapham, John Harold (1873-1946) conspicuous consumption Burns, Arthur Frank (1904-1987) Clark, Colin Grant (1905--1989) constant and variable capital business cycle Clark, John Bates (1847-1938) constitutions, economic approach to business cycle measurement Clark, John Maurice (1884-1963) consumer expenditure business networks class consumer expenditure (new Butlin, Noel George (1921-1991) classical distribution theories developments and the state of Cairnes, John Elliott (1823-1875) classical economics research) calculus of variations classical economics and economic consumer surplus calibration growth consumption-based asset pricing cameralism classical growth model models (empirical performance) campaign finance, economics of classical production theories consumption-based asset pricing Canada, economics in classical theory of money models (theory) Canard, Nicolas-Fran~ois (cl750-1833) climate change, economics of consumption externalities Cantillon, Richard (1697-1734) cliometrics consumption sets capital asset pricing model clubs consumption taxation capital controls coalitions contemporary capitalism capital gains and losses Coase, Ronald Harry (born 1910) contestable markets capital gains taxation Coase theorem contingent commodities capital measurement Cobb-Douglas functions contingent valuation capital theory Cobden, Richard (1804-1865) continuous and discrete time models capital theory (paradoxes) cobweb theorem contract theory capital utilization cognitive ability contracting in firms capitalism Cohen Stuart, Arnold Jacob control functions Carey, Henry Charles (1793-1879) (1855-1921) conventionalism Carlyle, Thomas (1795-1881) cointegration convergence cartels Colbert, Jean-Baptiste (1619-1683) convex programming Cassel, Gustav (1866-1944) collective action convexity caste system collective action (new perspectives) convict labour catallactics collective bargaining cooperation catastrophic risk collective choice experiments cooperative game theory Catchings, Waddill (1879-1967) collective models of the household cooperative game theory (core) categorical data collective rationality coordination problems and Catholic economic thought collusion communication causality in economics and command economy copulas econometrics commodity fetishism core convergence central bank independence commodity money cores List of entries A-Z ix

market microstructure methodological individualism music markets, economics of market period methodology of economics Muth, John F. (1930-2005) marketplaces Metzler, Lloyd Appleton (1913-1980) Myrdal, Gunnar (1898-1987) market power and collusion in micro-credit Nash, John Forbes (born 1928) laboratory markets microfoundations Nash equilibrium, refinements of market price Mill, James (1773-1836) Nash program market structure Mill, John Stuart (1806--1873) national accounting, history of marketing boards Miller, Merton (1923-2000) National Bureau of Economic Research markets Minard, Charles Joseph (1781-1870) national income Markov chain Monte Carlo methods Mincer, Jacob (1922-2006) national system Markov equilibria in macroeconomics minimum wages natural and warranted rates of Markov processes Mirrlees, James (born 1936) growth Markowitz, Harry Max (born 1927) Mises, Ludwig Edler von (1881-1973) natural experiments and quasi-natural marriage and divorce Misselden, Edward (fl. 1608-1654) experiments marriage markets Mitche", Wesley Clair (1874-1948) natural price Marschak, Jacob (1898-1977' mixed strategy equilibrium natural rate and market rate of interest Marsha", Alfred (1842-1924) mixture models natural rate of unemployment Marsha", Mary Paley (1850-1944) model averaging Navier, Louis Marie Henri (1785-1836) Marsha"-Lerner condition model selection neighbours and neighbourhoods Martineau, Harriet (1802-1876) model uncertainty Nemchinov, Vasily Sergeevich martingales models (1894-1964) Marx, Karl Heinrich (1818-1883) Modigliani, Franco (1918-2003 'neoclassical' Marxian transformation problem Modigliani-Miller theorem neoclassical growth theory Marxian value analysis monetarism neoclassical growth theory (new Marx's analysis of capitalist production monetary aggregation perspectives; Mason, Edward Sagendorph monetary approach to the balance of neoclassical synthesis (1899-1992) payments neo-Ricardian economics Masse, Pierre (1898- j 987,' monetary business cycle models (sticky network formation matching prices and wages) network goods (empirical studies) matching and market design monetary business cycles (imperfect network goods (theory) matching estimators information) neuroeconomics material balances monetary cranks neutral taxation mathematical economics monetary economics, history of neutrality of money mathematical methods in political monetary and fiscal policy overview new.classical macroeconomics economy monetary overhang New Deal mathematics and economics monetary policy new economic geography mathematics of networks monetary policy, history of new institutional economics maximum likelihood monetary policy rules new Keynesian macroeconomics maximum score methods monetary transmission mechanism new open economy macroeconomics Mazzola, Ugo (1863-1899) money Newcomb, Simon (1835-1909) McCu"och, John Ramsay (1789-1864) money, classical theory of Nikaido, Hukukane (1923-2001) McFadden, Daniel (born 1937) money and general equilibrium noise traders Meade, James Edward (1907-1995) money illusion nominal exchange rates meaningfulness and invariance money supply non-clearing markets in general Means, Gardiner Co it (1896--1988) moneylenders in developing countries equilibrium mean-variance analysis monocentric versus polycentric models non-cooperative games (equilibrium measure theory in urban economics existence) measurement monopolistic competition non-expected utility theory measurement error models monopoly non-governmental organizations measurement, theory of monopoly capitalism nonlinear panel data models mechanism design monopsony nonlinear programming mechanism design (new Moore, Henry Ludwe" (1869-1958) nonlinear time series analysis developments) moral hazard non-nested hypotheses mechanism design experiments Morgenstern, Oskar (1902-1977) non parametric structural models medieval guilds Morishima, Michio 1923-2004 non-profit organizations Menger, Carl (1840-1921) mortality non-standard analysis mercantilism motion pictures, economics of non-substitution theorems Mercier De La Riviere, Pierre-Paul multilingualism non-tariff barriers (Mercier or Lemercier) (1720-1793/4) multinational firms North American Free Trade Agreement Mercosur multiple equilibria in macroeconomics (NAFTA) merger analysis (United States) multiplier-accelerator interaction North, Douglass Cecil (born 1920) merger simulations multiplier analysis North, Dudley (1641-1691) mergers, endogenous Mun, Thomas (1571-1641) Nove, Alexander (Alec) N. (1915-1994) merit goods Munde", Robert (born 1932) Novozhilov, Viktor Valentinovich Merton, Robert C. (born 1944) municipal bonds (1892-1970) Methodenstreit Musgrave, Richard Abel (1910-2007) numeraire xiv List of entries A-Z numerical optimization methods in peasant economy Prebisch, Raul (1901-1986) economics pecuniary versus non-pecuniary precautionary principle Nurkse, Ragnar (1907-1959) penalties precautionary saving and nutrition and development Penrose, Edith Tilton (1914-1996) precautionary wealth nutrition and public policy in advanced pensions predatory pricing economies perfect competition prediction formulas offer curve or reciprocal demand curve perfect foresight prediction markets Ohlin, Bertil Gotthard (1899-1979) perfect information prediction market design oil and the macroeconomy period of production preference reversals Okun, Arthur M. (1928-1980) Perlman, Selig (1888-1959) Preobrazhensky, Evgenii Alexeyevich Okun's Law permanent-income hypothesis (1886-1937) oligarchs Perron-Frobenius theorem preordering oligopoly Perroux, Fran~ois (1903-1987) Prescott, Edward Christian (born 1940) Olson, Mancur (1932-1998) personnel economics present value operations research Persons, Warren Milton (1878-1937) price control opportunity cost peso problem price discrimination (empirical studies) optimal fiscal and monetary policy Petty, William (1623-1687) price discrimination (theory) (with commitment) pharmaceutical industry price dispersion optimal fiscal and monetary policy Phelps Brown, (Ernest) Henry price revolution (without commitment) (1906-1994) primary and secondary labour markets optimal tariffs Phelps, Edmund (born 1933) principal and agent (i) optimal taxation Phillips, Alban William Housego principal and agent (ii) optimality and efficiency (1914-1975) privatization optimum quantity of money Phillips curve privatization impacts in transition options Phillips curve (new views) economies options (new perspectives) philosophy and economics procurement orderings physiocracy product differentiation Oresme, Nicholas (1325-1382) Pierson, Nichlaas Gerard (1839-1909) product life cycle organic composition of capital Pigou, Arthur Cecil (1877-1959) production functions Organization of the Petroleum Pigouvian taxes profit and profit theory Exporting Countries (OPEC) planning progressive and regressive taxation Ortes, Giammaria (1713-1790) Plekhanov, Georgii Valentinovich propensity score output fall - transformational recession (1856-1918) property law, economics and overlapping generations model of pluralism in economics property rights general equilibrium Polanyi, Karl (1886-1964) property taxation Overstone, Lord [Samuel Jones Loyd] polarization proportional hazard model (1796-1883) policy reform, political economy of prospect theory Owen, Robert (1771-1858) political arithmetic protoindustrialization Palander, Tord Folkeson (1902-1972) political budget cycles psychological games Palgrave, Robert Harry Inglis political business cycles psychology of social networks (1827-1919) political competition public capital Palgrave's Dictionary of Political 'political economy' public choice Economy political institutions, economic public debt Palmer, John Horsley (1779-1858) approaches to public finance panic of 1907 pollution haven hypothesis public goods Pantaleoni, Maffeo (1857-1924) pollution permits public goods experiments paradigms Pontryagin's principle of optimality public infrastructure paradoxes and anomalies Poor Law, new public utility pricing and finance Pareto, Vilfredo (1848-1923) Poor Law, old public works Pareto distribution population ageing Pufendorf, Samuel von (1632-1694) Pareto efficiency population and agricultural growth purchasing power parity Pareto principle and competing population dynamics purification principles population health, economic quantal response equilibria partial identification in econometrics implications of quantile regression partial linear model Portugal, economics in quantity theory of money Pascal, Blaise (1623-1662) positive economics quasi-concavity patents positivism Quesnay, Fran~ois (1694-1774) patent valuation Post Keynesian economics R&D races path dependence Postan, Michael Mo"issey (1899-1981) racial profiling path dependence and occupations postmodernism radical economics path dependence in technical poverty Rae, John (1796-1872) standards poverty alleviation programmes Rae, John (1845-1915) Patinkin, Don (1922-1955) poverty lines Ramsey, Frank Plumpton (1903-1930) Patten, Simon Nelson (1852-1922) poverty traps Ramsey model payment systems power Ramsey pricing peasants power laws rational behaviour List of entries A-Z xv

rational choice and political science Robinson Crusoe self-confirming equilibria rational choice and sociology Robinson, Edward Austin Gossage Seligman, Edwin Robert Anderson rational expectations (1897-1993) (1861-1939) rational expectations models, Robinson, Joan Violet (1903-1983) Selten, Reinhard (born 1930) estimation of robust control semiparametric estimation rationality robust estimators in econometrics Sen, Amartya (born 1933) rationality, bounded Rogers, James Edwin Thorold Senior, Nassau William (1790-1864) rationality, history of the concept (1823-1890 ) separability rationing Roos, Charles Frederick (1901-1958) sequence economies Rau, Karl Heinrich (1792-1870) Roscher, Wilhelm Georg Friedrich sequential analysis Raymond, Daniel (1786-1849) (1817-1894) serial correlation and serial real balances Rosen, Sherwin (1938-2001) dependence real bills doctrine Rosenstein-Rodan, Paul Narcyz Shackle, George Lennox Sharman real bills doctrine versus the quantity (1902-1985) (1903-1992) theory Rosenthal, Robert W. (1944-2002) shadow pricing real business cycles Rostow, Walt Whitman (1916-2003) Shapley value real cost doctrine rotating saving and credit associations Shapley-Folkman theorem real exchange rates (ROSCAs) sharecropping real rigidities Rothbard, Murray N. (1926-1995) Sharpe, William F. (born 1934) real wage rates (historical trends) rotten kid theorem Shephard, Ronald William (1912-1982) realized volatility Roy model shrinkage-biased estimation in reciprocity and collective action Roy, Rene Fran~ois Joseph (1894-1977) econometrics recursive competitive equilibrium Royal Economic Society Sidgwick, Henry (1838-1900) recursive contracts Rubin causal model Sidrauski, Miguel (1939-1968) recursive preferences Ruggles, Richard (1916-2001) sieve extremum estimation redistribution of income and wealth Saint-Simon, Claude-Henri (1760-1825) signalling and screening reduced rank regression Samuelson, Paul Anthony (born 1915) silver standard regime switching models Sargan, John Denis 1924-1996 Simon, Herbert A. (1916-2001) regional and preferential trade satisficing Simons, Henry Calvert (1899-1946) agreements Sauvy, Alfred (1898-1990) Simonsen, Mario Henrique (1935-1997) regional development, geography of Savage, Leonard J. (Jimmie) simplex method for solving linear regression-discontinuity analysis (1917-1971) programs regular economies Savage's subjective expected utility simulation-based estimation regulation model simulation estimators in Reid, Margaret Gilpin (1896-1991) Sax, Emil (1845-1927) macroeconometrics religion and economic development Say, (Jean-Baptiste) Leon (1826-1896) simultaneous equations models religion, economics of Say, Jean-Baptiste (1767-1832) single tax rent Say's Law Sismondi, Jean Charles Leonard rent control Scandinavia, economics in Simonde de (1773-1842) rent seeking Schelling, Thomas C. (born 1921) size of nations, economics approach repeated games Schlesinger, Karl (1889-1938) to the reputation Schmoller, Gustav von (1838-1917) skill-biased technical change resale markets Schmookler, Jacob (1918-1967) slavery research joint ventures scholastic economics Slichter, Sumner Huber (1892-1959) reservation price and reservation Scholes, Myron (born 1941) sliding scales (wages) demand school choice and competition Slutsky, Eugen (1880-1948) residential real estate and finance Schultz, Henry (1893-1938) small-world networks residential segregation Schultz, T. W. (1902-1998) Smart, William (1853-1915) reswitching of technique Schumpeter, Joseph Alois (1883-1950) Smith, Adam (1723-1790) retirement Schumpeterian growth and growth Smith, Bruce D. (1954-2002) returns to scale policy design Smith, Vernon (born 1927) returns to scale measurement science, economics of SNP: nonparametric time series returns to schooling scientific realism and ontology analysis revealed preference theory Scitovsky, Tibor (1910-2002) social capital revelation principle Scott, William Robert (1868-1940) social choice reverse capital deepening Scrope, George Poulett (1797-1876) social choice (new developments) rhetoric of economics search-and-matching models of social contract Ricardo, David (1772-1823) monetary exchange social democracy Ricardian equivalence theorem search models of unemployment social discount rate Ricardian trade theory search theory social insurance risk search theory (new perspectives) social insurance and public policy risk aversion seasonal adjustment social interactions (empirics) risk-coping strategies second best social interactions (theory) risk sharing second economy (unofficial economy) social learning Robbins, lionel Charles (1898-1984) seemingly unrelated regressions social multipliers Robertson, Dennis (1890-1963) selection bias and self-selection social networks, economic relevance of xvi List of entries A-Z social networks in labour markets stochastic adaptive dynamics taxation of wealth social norms stochastic dominance Taylor rules social preferences stochastic frontier models Taylor, Fred Manville (1855-1932) Social Security in the United States stochastic optimal control Taylorism social status, economics and stochastic volatility models teams social welfare function stock price predictability technical change socialism stock price volatility technology socialism (new perspectives) Stockholm School temporary equilibrium socialist calculation debate stocks and flows term structure of interest rates soft budget constraint Stone, John Richard Nicholas terms of trade Solow, Robert (born 1924) (1913-1991) terrorism, economics of Sombart, Werner (1863-1941) strategic and extensive form games testing Sonnenfels, Joseph von (1733-1817) strateg ic trade policy Theil, Henri (1924-2000) South Sea bubble strategic voting theory appraisal sovereign debt strategy-proof allocation mechanisms third world debt Soviet and Russian research, stratification Thornton, Henry (1760-1815) development and innovation stratified and cluster sampling threshold models Soviet economic reform strikes Thunen, Johann Heinrich von Soviet growth record Strotz, Robert H. (1922-1994) (1783-1850) Soviet Union, economics in structural change Tiebout hypothesis Spain, economics in structural change, econometrics of Tiebout, Charles Mills (1924-1968) spatial econometric; structural unemployment time consistency of monetary and spatial economics structural vector auto regressions. fiscal policy spatial market integratior structuralism time preference spatial mismatch hypothesi,; stylized facts time series analysis specie-flow mechanism subsistence and subsistence wages time use specification problems in substitutes and complements Timlin, Mabel Frances (1891-1976) econometrics sugar industry Tinbergen, Jan (1903-1994) spectral analysis sunspot equilibrium Tintner, Gerhard (1907-1983) speculative bubbles supermodularity and supermodular Titmuss, Richard Morris (1907-1973) Spence, A. Michael (born 1943 \ games Tobin, James (1918-2002) Spencer, Herbert (1820-190: superneutrality Tobin's q Spiethoff, Arthur August Kaspar superstars, economics of Tobit model (1873-1957" 'supply and demand' Tocqueville, Alexis Charles Henri Clerel spline functions supply chains de (1805-1859) spontaneous order surplus Tooke, Thomas (1774-1858) sports, economics of survey data, analysis of Torrens, Robert (1780-1864) spurious regressions sustainability total factor productivity Sraffa, Piero (1898-1983) Swadeshi movement Townshend, Hugh (1890-1974) Sraffian economics Swan, Trevor W. (1914-1989) Toynbee, Arnold (1852-1883) Sraffian economics (new Sweezy, Paul Marlor (1910-2004) Tozer, John Edward (1806-1877) developments) Swift, Jonathan (1667-1745) tradable and non-tradable s-S models switching costs commodities stability and growth pact symmetry breaking trade and poverty stable population theory systems of cities trade costs Stackelberg, Heinrich von (1905-1946) Tableau economique trade cycle Stakhanovism taking (eminent domain) trade policy, political economy of Stalinism, political economy of Tarb~lI, Ida Minerva (1857-1944) trade, technology diffusion and standard commodity tariff versus quota growth standards of living (historical trends) tariffs tragedy of the commons state capture and corruption in Tarshis, Lorie (1911-1993) transaction costs, history of transition economies tatonnement and recontracting transfer of technology state-dependent preferences Taussig, Frank William transfer pricing state space models Tawney, Richard Henry (1880-1962) transfer problem statistical decision theory tax competition transition and institutions statistical inference tax compliance and tax evasion transitivity statistical mechanics tax expenditures transversality condition statistics and economics tax havens transversality conditions and dynamic status and economics tax incidence economic behaviour Steindl, Josef (1912-1993) tax shelters treatment effect Steuart, Sir James (1713-1780) tax treaties trend/cycle decomposition Stewart, Dugald (1753-1828) taxation and poverty Triffin, Robert (1911-1993) sticky wages and staggered wage taxation of corporate profits Trotsky, Lev Davidovitch (1879-1940) setting taxation of the family trust in experiments Stigler, George Joseph (1911-1991) taxation of foreign income Tsuru, Shigeto (1912-2006) Stiglitz, Joseph E. (born 1943) taxation of income Tucker, Josiah (1713-1799) List of entries A-Z xvii

Tugan-Baranovsky, Mikhail Ivanovich urbanization war and economics (1865-1919) user fees Warburton, Clark (1896-1979) tulipmania Usher, Abbot Payson (1884-1965) Warming, Jens (1873-1939) Turgot, Anne Robert Jacques, Baron de utilitarianism and economic theory Washington Consensus L'Aulne (1727-1781) utility wavelets turnpike trusts value elicitation wealth Tversky, Amos (1937-1996) value judgements Weber, Alfred (1868-1958) two-sector models value of life Weber, Max (1864-1920) two-sided markets value of time Weintraub, Sidney (1914-1983) two-stage least squares and the k-class value-added tax welfare costs of business cycles estimator variance, analysis of welfare economics uncertainty variance decomposition welfare state uncertainty and general equilibrium varying coefficient models Wells, David Ames (1828-1898) uncovered interest parity Veblen goods West, Edward (1782-1828) underconsumptionism Veblen, Thorstein Bunde (1857-1929) Wheatley, John (1772-1830) underemployment equilibria vector autoregressions Whewell, William (1799--1866) unemployment venture capital Wicksell, Johan Gustav Knut unemployment and hours of work, Verri, Pietro (1728-1797) (1851-1926) cross country differences vertical integration Wicksell effects unemployment insurance Vickrey, William Spencer (1914-1996) Wicksteed, Philip Henry (1844-1927) unemployment measurement Vind, Karl (1933-2004) Wiener process uneven development Viner, Jacob (1892-1970) Wiesner, Friedrich Freiherr, (Baron) von unforeseen contingencies vintage capital (1851-1926) unit roots vintages Witte, Edwin Emil (1887-1960) United States, economics in virtual economy Wold, Herman O.A. (born 1908) (1776-1885) von Neumann, John (1903-1957) women's work and wages United States, economics in Vorob'ev, Nikolai N. (1925-1995) Wood, Stuart (1853-1914) (1885-1945) voting paradoxes worker participation and profit sharing United States, economics in (1945 to Wade, John (1788-1875) World Bank present) wage curve World Trade Organization Uno, Kozo (1897-1977) wage indexation World Wars, economics of urban agglomeration wage inequality, changes in X-efficiency urban economics wages fund Yntema, Theodore O. (1900-1985) urban environment and quality of life Wakefield, Edward Gibbon (1796-1862) Young, Allyn Abbott (1876-1929) urban growth Wald, Abraham (1902-1950) Young, Arthur (1741-1820) urban housing demand Walker, Francis Amasa (1840-1897) Zawadzki, Wladyslaw Marian urban political economy Walras, Antoine Auguste (1801-1866) (1885-1939) urban production externalities Walras, Leon (1834-1910) Zeuthen, Frederik Ludvig Bang urban transportation economics Walras's Law (1888-1959)