Comparative Economic Systems

Dr. Satya J. Gabriel
Associate Professor of Economics
e-mail: sgabriel@mtholyoke.edu
FAX: 413-538-2323

Course Description:

This is a seminar course in the comparative analysis of variant types of capitalist and non-capitalist social formations and the transition of social formations from one set of prevalent characteristics to a new and radically different set.  We will discuss the theoretical problems in applying current economic theories (neoclassical, Marxian, and institutionalist) to the comparative analysis of social formations. It will be demonstrated that Marxian and institutionalist theories provide a rich source of concepts and relationships upon which to build a comparative economic analysis, while the neoclassical framework has a dearth of concepts that allow for the recognition of certain meaningful systemic differences. For this reason, students should be prepared to learn new concepts, relationships, and methodologies that have been produced within the Marxian, political economy, and institutionalist debates. It is worth noting that most economics students will not be familiar with these debates prior to taking this seminar and it is, therefore, not sufficient to rely upon prior knowledge of neoclassical concepts. On the other hand, a firm grounding in neoclassical concepts provides students with an excellent starting point for understanding where the new concepts provide a different way of organizing data and performing economic analysis. The bottom line, so to speak: Students should be prepared to have critical discussions of the most basic economic concepts and logics in our attempt to separate science from polemics and to develop new conceptual tools appropriate to the analysis and differentiation of economic systems.

We will focus upon economic phenomena, but will also discuss the role of cultural, political, and environmental processes in shaping economic differences between social formations. Comparative economic systems analysis is grounded in the creation of meaningful categorical differences between national economies (economies that are already differentiated on the basis of political boundaries).  Such categorical differences might be based on a wide range of factors, including, but not limited to, i) property relationships, ii) market relationships, iii) class relationships, and, iv) relative involvement of the state in economic relationships.  The first possible categorical difference can itself be subdivided between a) property relationships involving control over the economic enterprise or firm or b) property relationships involving control over the output of economic enterprises or firms.  The other categories are also amenable to subdivisions.  The third possible categorical difference, class relationships, involves answering the question of who produces and who appropriates and distributes economic surpluses.  However, different economic theories produce different understandings of what is an "economic surplus."  Thus, within the course we will need to explore both the question of how do we define difference and how do we understand the concepts upon which that defined difference is based.  These are interesting and provocative issues and students should be prepared to debate them in the seminar.  Students will also need to understand these issues sufficiently to produce a semester paper and to make a class presentation related to this semester paper.

When is ownership important?What kinds of ownership are important? Why does it matter if the direct producer (worker) has an ownership stake in the goods she produces? How are agency costs implicated in the problems of state-owned enterprises and are these agency costs significantly different than the ones found in corporations with widely dispersed public shareownership? What is the role of the state in shaping differences and similarities between existing (and historic) economic systems? What is the role of cultural institutions and processes, such as nationalism and racism, upon the reproduction of similarities and differences in economic systems (and variant forms of economic systems)? What forces do population pressures or a relative scarcity of natural resources play in shaping the social formation, including the economic system? These are the types of questions that will come up during our discussions. We will try to avoid relying upon simple, economic determinist arguments, although we will identify many such arguments in the economics literature. Our approach will be open-minded, in the sense that we will allow for the possibility that the complex similarities and differences in social formations (and the underlying economic systems) is the combined product of the aforementioned cultural, political, environmental, and economic processes but cannot be reduced to any one subset of these. This is no minor matter. It allows the participants in the seminar a wider degree of freedom in exploring the forces shaping economic systems than might otherwise be the case. This freedom extends to the student's choice of thesis for her semester research paper.

What are some of the specific topics and case studies that may be examined in the course? Past examples include: The theoretical implications of the recent economic crisis in Asia; the end of the Soviet economic experiment (What sort of economic system did Stalin build?); dramatic economic and financial sector reforms, extraordinary growth rates, and the restructuring of state-owned enterprises in China; the reshaping of capitalism in India with economic reforms and the development of the high tech sector; the relationship between economic reform and corruption in Viet Nam; big bang reforms in Japan (Are we entering an era of a new form of Japanese capitalism?); political reform and the crisis of the chaebol system in South Korea; the communal system of the Israeli kibbutz (Does this form of communism offer a real alternative to capitalism?); and Islamic economic systems in theory and practice. 

Requirements: Intermediate micro and macro are important because students need to be fluent in neoclassical economics before pursuing the more multi-lingual skills required in comparative economic systems. A third intermediate level course in Marxian theory, economic development, or Asian economies is highly recommended, but not required. Comparative economic systems is a challenging course, in part, because it requires students to learn new ways of thinking about economics and ways of applying theory. The path to obtaining the necessary conceptual skills required in such a course is not singular. Thus, it may be possible for students to come to this course with very different backgrounds than those embodied in the requirements. On the other hand, a student with the above listed requirements might still find the course difficult because she finds learning new epistemological, ontological, and/or methodological ideas problematic. Any student who is concerned that she may have inadequate preparation for this course should feel free to contact me at extension 2043 or by e-mail (sgabriel).
 

In the calendar below, please note that all readings listed for a particular date should be read prior to that date.  Students are expected to be prepared to discuss these readings on the date they are listed.  Keep in mind that participation in classroom discussions is an important element in grading.
 
 

Selected texts used in the course: