Interdisciplinary Ph.D. in Economics
IPHD QUALIFYING EXAMINATIONS
STUDENT REVIEW
Department of Economics
University of Missouri-Kansas City
May 2009
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IPHD QUALIFYING EXAMINATIONS
STUDENT REVIEW
Organization of the Qualifying Examination in
Economic Theory
PART I: MACROECONOMICS, MICROECONOMICS, AND POLITICAL ECONOMY
Instructions: Part I consist of three sections: A) Macroeconomics; B) Microeconomics; and C)
Political Economy. You must answer questions in each section—read the directions carefully. You
may work on Part I between 9 AM and 1 PM. You should allocate one hour to each section.
All of your answers should be in the form of essays. You should provide citations to the relevant
literature (Author’s name, and date and title of the work as best as you can remember them).
Save your work frequently, both to the supplied USB stick drive and to the hard drive. When
you are finished, the proctor will print your essays. Be sure to indicate which question (Part,
Section, Question #) you are answering. You may not keep any copy of your exam. Use only
your student identification number to identify your answers. Do not use your name.
Part I: Area Specific Questions
A.
Macroeconomics – 1 hour
B.
Microeconomics – 1 hour
C.
Political Economy – 1 hour
PART II: INTERRELATIONSHIPS OF MICRO, MACRO AND POLITICAL ECONOMY
Instructions: Part II consists of only one section. You will answer two questions in Part II. You
should allocate 1 and a half hours to each of the questions you choose to answer. You may work on
this exam from 9.00 a.m. until 1.00 p.m. Under no circumstances will you be permitted to work on
the exam after 1.00 p.m. All of your answers should be in the form of essays. You should provide
citations to the relevant literature (Author’s name, and date and title of the work as best as you can
remember them).
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Sample Questions for the Qualifying in Economic Theory
Part I: Area Specific Questions
A. Macroeconomics – 1 hour
Choose one of the following questions.
1.
Much debate in macroeconomics has concerned the role that savings plays in the economy,
and particularly the influence that saving might have on important economic phenomena such
as growth rates, investment, interest rates, and employment. Write a critical essay that surveys
the major positions taken by macro theorists regarding the role played by savings in the
economy.
2.
Keynes argued that his theory is a general theory, while the classical theory (what we now call
the neoclassical theory) is a special case applicable only under specific assumptions. Critically
analyze Keynes’s claim. Be sure to extend Keynes’s analysis to an examination of modern
macroeconomic schools of thought (of both the orthodox and heterodox varieties).
3.
Compare/contrast the orthodox (Goodhart calls it “metallist”) and nonorthodox (“chartalist” or
“taxes-drive-money” or “state money”) approaches to money. Be sure to include discussions
of the following topics: a) origins and nature of money; b) impact of money on the economy;
c) “endogenous vs exogenous” money; and d) “fiat” vs “commodity” money.
4.
The conventional view is that government deficits “crowd-out” private spending. Carefully
lay-out economic models that could be used to justify this conventional wisdom. (You should
be able to analyze several alternative models that could be used to support this position.)
Identify what assumptions and conditions must hold in order to make this claim. Briefly
discuss the empirical evidence for and against the crowding out hypothesis. Finally, critically
analyze the crowding out hypothesis from the perspectives of “endogenous money”,
“functional finance”, and “money as a creature of the state”.
5.
What does Lerner mean by saying “money is a creature of the state”? Link this to his
“functional finance” approach. According to Perry Mehrling, we no longer live in the world
of Keynes, Lerner, or Knapp and hence the “state money approach” is no longer relevant.
Instead, we live in a world in which the modern state “is the one entity with which every one
of us does ongoing business”—a giant Microsoft, so to speak. Hence, “we are all willing to
extend credit to the government” and this is what “gives government credit its currency”.
Critically analyze this view, comparing and contrasting it with the Lerner view.
6.
Define the monetary theory of production, along the lines suggested by Keynes. What are the
key features? Compare and contrast Keynes’s monetary theory of production with the
approach to money taken in each of the following approaches: i) Neoclassical theory; ii)
State/Chartalist Money; iii) Schumpeter and Circuit theory; and iv) Marxist theory.
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7.
What is money? Contrast the Post Keynesian view with that of orthodoxy.
8.
The chart below shows real GDP for the United States, January 1949 – December 2001.
Recessions are highlighted by grey bar graphs. The dark upward-sloping line indicates the
economy’s long-run trend rate of growth. Critically examine the business cycle theory of at
least four of the following: Monetarism Mark I (Friedman’s version); Monetarism Mark II
(the Lucas approach); Real Business Cycle; “Keynesian” (ISLM); Institutionalist (Veblen,
Mitchell); Post Keynesian (Minsky, Wolfson); Marx (Sherman, Gillman).
9.
Compare Keynes’s approach to effective demand with that of Marx (as presented by Fan
Hung). Compare Keynes’s adoption of the labor unit with Marx’s adoption of the labor theory
of value.
10.
Compare/contrast the Keynesian/Institutionalist approach to the relation between saving and
investment with that of orthodoxy.
11.
Compare/contrast the Currency School and Banking School approaches to money, drawing
links to the modern Monetarist and Post Keynesian approaches.
12.
Summarize the key features of the role played by endogenous money in the circuit. What are
the links between Post Keynesians and Circuitistes on money?
13.
Link Schumpeter’s approach to the circular flow with that taken by modern “circuitistes”.
14.
What is the Cambridge critique of the neoclassical approach? Discuss Say’s Law, the
movement of the economy through time, the possibility of functional relationships between
prices and quantities, different approaches to the concept of equilibrium, and achievement of
full employment.
15.
How does the Cambridge interpretation of Keynes’s theory of effective demand (as a long
period approach) differ from that of other Post Keynesians? What do Cambridge economists
think of the Post Keynesian emphasis on uncertainty? Explain.
16.
Compare/contrast the horizontalist approach to money with the structuralist approach.
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17.
Contrast the “chartalist” with the “metalist” approaches to money. What sorts of problems
might the European Union encounter, based on Goodhart’s chartalist approach?
18.
When is crowding out most likely/least likely to occur? From the state money (or modern
money) approach, do deficits place pressure on interest rates? Explain.
19.
Neoclassical Model (sometimes called the Classical Model). Use pictures and words to show
determination of equilibrium values for income, expenditure, consumption, saving, interest
rates, wages, and employment in the Neoclassical Model. Then answer each of the following
questions concerning this model.
a. Explain why the equilibrium level of employment must be at full employment.
b. Explain why falling wages would necessarily move the economy toward full employment.
c. Show the results of an increase of government spending. Does government spending “crowd
out” private spending? Explain.
d. Show and explain the results of an increase of "thriftiness".
e. Show and explain the results of a rise of productivity.
21.
Milton Friedman claims that “inflation is always and everywhere a monetary phenomenon”.
Critically assess this claim from the perspectives of: New Classical theory; Real Business
Cycle theory; New Keynesian theory; and empirical evidence.
22.
Explain Minsky’s financial instability hypothesis.
23.
Why is the New Classical approach seen as a "supply side" approach, while the "orthodox"
approach adopted by "Keynesians" and orthodox Monetarists is considered "demand side" in
its approach? Describe the ways in which these approaches differ from a Post Keynesian
(PK) approach. Is the PK approach supply- or demand-side in its emphasis? Explain.
24.
Define the monetary theory of production, along the lines suggested by Keynes. What are
the key features? Compare and contrast Keynes’s monetary theory of production with the
approach to money taken in each of the following approaches: i) Neoclassical theory; ii)
State/Chartalist Money; iii) Schumpeter and Circuit theory; and iv) Marxist theory.
25.
It is often claimed that Keynes endorsed Hicks’s ISLM model. However, in a letter to Hicks,
Keynes objected that in Hicks’s model, an increase of spending must raise interest rates,
while in Keynes’s own approach, an increase of spending might, but need not raise interest
rates. First, use the ISLM model to show and explain why an increase of spending raises
interest rates. Second, explain Keynes’s objection to this result (why can’t the model
present Keynes’s approach?). Third, relate Keynes’s objection to the Post Keynesian
approach to the relation between money and spending. Finally, compare and contrast the
impact of an increase of government spending on interest rates in the ISLM model, versus
the impact of an increase of government spending on interest rates in the Chartalist/State
Money/Modern Money approach.
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26.
Interest rates and monetary policy. Answer all of the following.
a. One could argue (as did Townshend) that Keynes’s approach to interest rates is really a theory
of value, not a theory of money demand. Explain.
b. Carefully examine the difference in the approach that Keynes takes to the determination of
interest rates in his chapters 13&15 versus that of chapter 17.
c. Under what conditions do liquidity preference and loanable funds theories reach the same
conclusions? Explain.
d. When is crowding out most likely/least likely to occur? From the state money (or modern
money) approach, do deficits place pressure on interest rates? Explain.
e. Is there room for liquidity preference in the “endogenous money” approach? In the
“horizontalist” approach? Explain.
27. The Marginal Propensity to Consume (MPC), Liquidity Preference Theory (LPT) and the
Marginal Efficiency of Capital (MEC) are crucial determinants in Keynes’s Theory of Effective
Demand. Carefully discuss the theory that underlies each of these concepts. How can a change
in ‘psychology’ affect the real economy through each of these channels (i.e. MPC, LPT and
MEC). How is the point of Effective Demand determined? Under what conditions will the
point of Effective Demand coincide with full employment? According to Keynes, what is the
cause of unemployment? How does Keynes's own view on this differ from that of many of his
followers, such as those who adopt the Neoclassical Synthesis ("Bastard Keynesians") or the
New Keynesian approach?"
28.
Expectations play a role in most macroeconomic theory. Carefully compare and contrast the
approach taken to expectations taken in each of the following schools of thought: a)
Keynes’s theory; b) New Classical theory; c) Austrian theory; and d) New Monetary
Consensus theory. Be sure to include a discussion of the importance of expectations
formation to policy formation.
29.
Keynes argued that his theory is a general theory while the classical theory (what we now
call neoclassical theory) is a special case applicable only under specific assumptions.
Critically analyze Keynes’s claim. Be sure to extend Keynes’s analysis to an examination of
modern macroeconomic schools of thought (of both the orthodox and heterodox varieties).
B. Microeconomics - 1 hour
Instructions: Answer two of the following questions. Allocate 30 minutes per question.
1.
Provide a theoretical explanation for the existence of stable prices at the level of the business
enterprise and the market.
2.
Market governance consists of institutionalized patterns of behavior that constrain decision
making of business enterprises. Discuss.
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3.
The existence of agency enables the household to overcome the advertising of corporations
and determine their own patterns of consumption. Discuss.
4.
The coordination of economic activity is effectuated only by the investment decisions of
business enterprises and expenditure decisions of government. Discuss.
5.
Markets as institutions and the coordination of economic activity by market prices are
theoretically incompatible. Discuss.
6.
Heterodox microeconomics does not have a theory of consumer choice between work and
leisure, but it still can discuss employment decisions by business enterprises and workers.
Discuss.
7.
Use heterodox price and production models to critically evaluate the following statement:
“The reduction of the profit mark up increases economic activity by increasing the wage
share in net national income.”
8.
Heterodox production and cost theory is not dependent on the marginal product of labor. Why
is this the case, and what implications does this have for using equilibrium analysis to explain
the economic decisions of the business enterprise?
9.
The business enterprise can finance its working and fixed capital expenditures through its
price policy and hence is independent of the financial system. Discuss.
10.
Using heterodox price and production/quantity models in the context of a monetary production
economy, what happens to the profit mark up, prices, the wage share, and aggregate economic
activity when there is a change in the money wage rate?
11.
There is no such thing as a freely competitive market. Why?
12.
In heterodox production theory there are no marginal products. Why? What does this mean
about the origin of profits and about the determinants of the profit mark up?
13.
Heterodox microeconomics does not have a theory of rational consumer choice. Does this
mean that in heterodox economics the consumer makes irrational choices when he/she decides
to purchase goods, such as a bike instead of a SUV?
14.
How do critical realism and the method of grounded theory affect the development of
heterodox microeconomic theory?
15.
Heterodox microeconomics does not have a theory of consumer choice. Therefore it cannot
say anything about consumer demand. Discuss.
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17.
State intervention into markets is necessary for market governance and in fact is demanded
by enterprises. Discuss.
18.
Price changes of a product cannot be explained solely in terms of a single enterprise and nor
can they be explained solely in terms of the market. Discuss.
19.
“Foreign wars and natural disasters are necessary for a well-functioning capitalist economy.”
Explain the microeconomic foundations of the statement.
20.
It is the fertility rather than the niggardliness of technology that dominates the production and
cost structure of the business enterprise. Discuss and relate the discussion to the theoretical
issues of constant average direct costs and the size of the business enterprise.
21.
Because markets are institutions, there is no relationship between sales and the market price.
Discuss.
22.
Central to heterodox microeconomics, prices do not allocate resources among
competing ends. So what do prices do?
23.
Profits are produced and hence non-scarce; thus the distribution of income is not an
important economic variable and the labor theory of value is invalid. Discuss.
24.
In heterodox microeconomics, the transaction of goods and services is not a
fundamental unit of analysis but the goods and services as commodities are. Discuss.
25.
Using a heterodox price-quantity model, explain why an increase in the money wage rate
does not alter the wage share whereas a change in the profit mark up does alter it.
26.
Because markets are social institutions, enterprises have to control them. Discuss.
27.
Why are there product and labor markets in neoclassical microeconomics but not in
heterodox microeconomics?
28.
Why are diminishing marginal products necessary for neoclassical cost theory but not
necessary for heterodox cost theory?
29.
Explain the concept of “Nash Equilibrium.” Under what circumstance(s) would such an
equilibrium be sub-optimal? Does such a result pose a theoretical difficulty for conventional
neoclassical theory?
30.
Consider the following utility function: U  x .5 y .5
x,y > 0
(a)
Find the equation for the slope of the indifference curve corresponding to this
utility function.
(b)
Prove that the slope of the indifference cure is negative throughout its entire
domain. Be sure to state the assumptions necessary to establish negativity.
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31.
Discuss and debate (Geoff Hodgson and others) debate on an Darwinian vs
Lamarkian evolutionary lens for economics.
32.
How does Nelson and Winter link the concept of organizational routines to the
Schumpterian idea of macro growth? Discuss
33.
What is Dopfer's meaning of "meso" economics? How does it link with micro and
macro?
34.
A key lens within EE (and other heterodox micro) is the term "dynamic". What
does that entail from a theoretical AND empirical standpoint?
35.
Based on the 1898's Veblen article as well as more current Hodgson (Cambridge
Journal, 1998) and the Nelson/Winter book (1982, ch 2)- why should we have an
evolutionary view of economics? Discuss?
36.
In general, what are the criticisms of the heterodox regarding neoclassical
micro theory, assumptions and methods. Discuss in detail and give examples?
37.
Discuss the issue of bounded rationality? What is embodied into this theory?
Does it meet a realistic lens on how individuals actually make daily decisions?
38.
Describe the place of transactions, prices, utility, institutions and
organizational routines as a methodological unit of analysis. How would you go
about studying a firm or market using this/these units? Can these be studied
using quantitative OR a qualitative approaches?
39.
Schumpeter’s writings are considered one of the major backbones of
contemporary evolutionary economics. However, Schumpeter himself would probably
have never been considered an evolutionary economist. Discuss this.
40.
In neoclassical economics, firms are bundles of production functions.
However, in EE firms are thought of as bundles or routines (or codified habits
embedded into institutions). Explain this view of the firm.
41.
As a microeconomic theory, what is meant as endogenous organizational
change. Discuss this.
42.
Supply and demand are in neoclassical theory as two exogenous forces that
converges to an equilibrium. In EE, supply and demand and are considered very
endogenous. Discuss this.
43.
Discuss what is meant by these EE terms- equilibrium forces, disequilibrium,
punctuated equilibrium and multiple equilibrium. Is the term “equilibrium” the
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same term in EE as used in neo-classical microeconomics.
44.
Taking a standard production function, what would an EE need to change/add
to make it consistent with its theory? Also, discuss this in terms of a
Cobb-Douglas function (through an EE lens).
45.
In the EE micro foundations, the concepts of routines and organizations
change hold a major role. Discuss the issues of routinization, codification,
replication, social learning and interaction, learning by doing, imitation,
endogeneity, and bounded rationality within this concepts.
46.
In the standard theory of production, technology and innovation is
considered exogenous. EE considers it endogenous. Explain this.
47.
Based from the standard theory of production- restate the elements of the
theory it would take to satisfy a heterodox view. Do so either descriptively
and/or mathematically.
48.
Discuss the heterodox attempts at a view of consumer (household) demand.
Compare it to Gary Becker’s (Chicago School) view.
49.
What are the determinants of market demand for consumer goods and investment
goods?
50.
The various heterodox schools (EE, PK and OIE) have all struggled with a
struggled with a comprehensive view of consumption (demand). Why? What are the
contribution each have given. What still needs exploration?
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Organizational and NOT financial or ownership embeddedness is likely to be more
important cause of actions than anything else in the case of the United States. Discuss.
52.
The political-cultural approach more systematically pursues the notion that resource
dependence is socially constructed. Leading the focus on technical environments to be
supplanted by a focus on institutional environments. Discuss.
53.
As firms interact with each other and with their environments, formal informal rules emerge
to govern interaction, and organizational fields are forms. Once these fields become
institutionalized, however, they take on an independent status that has a powerful normative
effect on subsequent interaction. Discuss.
54.
There is a great deal of agreement across the literature that government-firm relations are
pivotal to market stability and growth (See Fligstein’s propositions 2.1-3.1 for some
examples). Discuss.
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55.
Define and discuss what economic sociologists such as Fligstein, mean by fields,
organized social space, state building and markets? How does these interact (ie markets as
fields)?
56.
Discuss the megacorp and its relation to micro and macroeconomics.
57.
Embedded within the concept of Administered Prices is the practice of full cost pricing and
normal cost pricing. Discuss these technique(s); what is the evidence for it? How does
market structure impact these? Elasticity? How does demand and time affect them? What is
the evidence for this?
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Based upon the 4 articles that discussed GT theory (Finch, Doughtery, Strass, Suddaby) read and review one of the articles they cite which “provides a good example” of the
practice. Although the three GT articles closely examined in Finch, (1998) are “off-limits”your write-up would look similar to his. Discuss your chosen article- how does it use GT?
What are its strengths and flaws? Does it fulfill all the properties of a fully fulfilled GT?
Secondly, based upon the GT theory articles- are there any theoretical contradictions of the
“what is GT and how it is practiced”.
59.
Within the concept of administered pricing, how is the practice of “mark-up” calculated?
How is it related to investment, growth, market structure and demand curves faced by the
firms. What is the evidence for it?
60.
We dismissed the concept that a production function is a set of homogenous inputs used to
create a set of outputs. From this concept- discuss what is needed to create a realistic theory
of production. Make sure you also address the concepts of embedednesss, increasing returns,
heterogeneity, technology, learning, entrepreneurship, competitive advantage, agency, etc
within production.
61.
In the EE micro foundations, the concepts of routines and organizations change hold a major
role. Discuss the issues of routinization, codification, replication, social learning and
interaction, learning by doing, imitation, endogeneity, and bounded rationality within the
concepts.
62.
Organizing paths (historical institutionalism) helps explains not only why “history matters”,
but how sub-optimal situations can exist and persist. Discuss the different forms of the paths.
What is inherent in each? Make sure you comment on the role increasing returns, selfreinforcement, non-ergodicity, mindful deviation, behavioral vs. technological and positive
feedback. What have other social sciences such as political science, geography, management
and sociology added to this debate?
63.
Discuss the idea of a transaction as a unit of analysis? Using a Williamsonian framework, how
does one operationalize transaction costs into a framework to determine vertical boundaries?
Discuss and debate his assumptions and conclusions. Discuss what he mean about market vs.
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hierarchy? How does that compare and contrast with the RBV and DC approach?
64.
Discuss how resources and capabilities help explain how competitive advantage can be
established and sustained. What do we mean by intra-industry competitive advantage? Include
discussions on isolating mechanisms, causal ambiguity, complexity, the importance of
dynamism, etc?
65.
Discuss Schumpeter’s view of creative destruction (“the perennial gale of creative
destruction”). How is this tied to different types of innovation? How is it tied to Nelson and
Winter’s idea of routines or Veblen’s view of habits? How is it tied to the idea of dynamic
capabilities? How is it tied to the concept of path creation? Tied to the manager vs.
entrepreneur? Also discuss it’s implication for growth, market structure and the policy
implications. Why is this theory more prevalent today than it was when he wrote it in the
1930s?
66.
What is meso-economics? How is it linked to institutionalism; (structuration and replication)?
How is it linked to organizational economics, how is it linked to industrial organization? How
is it linked to the other social sciences? Define and describe how one can link micro to meso.
What is the unit of analysis in meso-economics? What about the concepts of economic and
social complexity?
67.
We discussed three phases and theories of the business enterprise: the invisible hand (Smith),
the visible hand (Chandler) and the vanishing hand (Langolis) (also all discussed in varying
degrees in Lazonick). Describe and discuss each and place them in their proper context. Infuse
the concepts of Penrose on resources as well as your knowledge of dynamic capabilities. How
and why does each concept effect organizational structure, the vertical process, division of
labor, and (dynamic) transaction costs & market structure. Finally, bring in examples and
concepts from the Lazonick book & article plus Chandler (US and UK article) for each. (If
you need to, feel free to “Google” Smith’s comments on the invisible hand and division of
labor, plus see Lee’s primer on the business enterprise).
68.
Discuss the concept of "fields to markets" as they relate to property rights, governance
structures and rules of exchange (Fligstein). How is this related (or unrelated) to Granovetter's
embeddedness of institutions and Jacobides 'Market Architecture and the design of
organizational capabilities".
69.
We discussed three phases and theories of the business enterprise: the invisible hand (Smith),
the visible hand (Chandler) and the vanishing hand (Langolis); (also discussed in varying
degrees in Lazonick). Describe and discuss each and place them in their proper context. Infuse
the concepts of Penrose on resources as well as your knowledge of dynamic capabilities. How
and why does each concept affect organizational structure, the vertical process, division of
labor, and (dynamic) transaction costs & market structure?
70.
In neoclassical economics, firms are bundles of production functions. However, in
evolutionary economics firms are thought of as bundles or routines (or codified habits
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embedded into institutions). Explain this view of the firm. Also discuss the issues of
routinization, codification, replication, social learning and interaction, learning by doing,
imitation, endogeneity, and bounded rationality within this concepts.
71.
Using a heterodox price-quantity model embedded in a Chartalist monetary production
economy, explain why an increase in the wage rate does not reduce the profit mark up.
72.
Embedded within the concept of administered prices is the practice of normal costs/target
rate of return pricing. Discuss this pricing technique. What is the evidence for it? How does
market structure impact the determination of administered prices? Does price elasticity of
demand have a role in the determination of administered prices? Does demand and time
affect the determination of administered prices? What is the evidence for this?
73.
Explain why it is impossible to derive a supply schedule in neoclassical theory if firms are
not perfectly competitive.
74.
In the context of a heterodox price-quantity model embedded in a Chartalist monetary
production economy, examine the relevance of big business, monopoly power, administered
prices, and price stability for the Hansen-Kalecki-Steindl-Baran/Sweezy stagnation thesis.
75.
It is common among mainstream and heterodox economists to argue that business enterprise
investment decisions are dominated by financial variables, such as interest rates. What
theoretical arguments and empirical evidence exists to warrant this belief? Discuss.
C. Political Economy – 1 hour
Answer one of the following questions.
1.
Thorstein Veblen's conception of economic analysis has several distinctive concepts. Included
in his analysis are 1) the instinct of workmanship, 2) the machine process, 3) conspicuous
consumption, and 4) that the economy as evolutionary, cumulative and adaptive.
a. Define and explain 1, 2 and 3.
b. Discuss how they are related to each other.
c. Discuss how they are related to and affected by 4.
2.
Marx developed the "laws of motion" of capitalism. Briefly summarize the constituent
elements of these laws. Explain and discuss the sequence of events that the "laws" predict.
3.
Karl Polyani articulates the idea that 19th century economic history of England was centered
on what he calls "the double movement".
a. Discuss Polyani's analysis of the double movement.
b. Explain its impact on economic ideology.
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c. Assuming Polanyi is correct in this assessment, discuss the implications for a) the
standard neoclassical economic theory of the organization of production, and b)
economic policies that are rooted in the economic philosophy of laissez faire.
4.
Veblen concludes that capitalism will evolve either into a non-capitalist (socialist?) form or
social organization or retreat into a form of “barbarism” that some equate to the fascist
societies of the 1920’s, 1930’s. Why does Veblen reach this conclusion? In your response,
draw on Veblen’s main theoretical argument, carefully drawing out those features or points
that lead to this conclusion.
5.
Marx’s theory of simple and extended reproduction in volume two of Capital
presents a model of balanced growth in a capitalist economy.
(a) Describe Marx’s schemes of simple and extended reproduction, and define the
condition he establishes for successful reproduction.
(b) Contrast the model of reproduction, which establishes the conditions for balanced
growth, with Marx’s circuits of capital, which emphasize the many problems that
may prevent successful reproduction and growth.
(c) Choose one or more twentieth century economists whose work was influenced by
Marx’s volume two reproduction models and discuss how this influence can be
seen in their work.
6.
It is often argued that Marx and Veblen have similar general theories, and often argued that
Veblen’s general theory is opposed to that of Marx. Take a position defending either
argument. In defending your position, explain your understanding of the general theories of
both Marx and Veblen and develop your defense showing the similarities or differences
between them.
7.
Why is it claimed that Marx’s general theory leads to a “scientific socialist” conclusion? In
your response, explain clearly and succinctly what Marx understands by the term
“socialism,” why socialism emerges from his general theory, and explain the difference
between Marx’s position on the emergence of socialism and that of earlier “utopian”
socialists such as Robert Owen, Charles Fourier, et al.
8.
Some institutionalists see a similarity between the general theory of Karl Polanyi and Karl
Marx. Others see a marked difference. Write an essay defending either position, succinctly
explaining the general theory of each, and, based on this explanation, demonstrate why you
argue the case for similarity/difference.
9.
Some institutionalists see a similarity between the general theory of Karl Polanyi and
Thorstein Veblen. Others see a marked difference. Write an essay defending either position,
succinctly explaining the general theory of each, and, based on this explanation, demonstrate
why you argue the case for similarity/difference.
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10.
Why does Veblen reach the conclusion that capitalism must either progress to socialism
or regress to “barbarism”? Carefully develop the specific features of Veblen’s general theory
that lay the foundations for these two possible outcomes and analyze the forces that would
lead to one or the other result.
11.
Is Veblen’s, Theory of the Leisure Class a fundamentally separate tract from his Theory of
Business Enterprise or are the two works interrelated? Explain.
12.
What is your understanding of Marx’s argument surrounding the “laws of motion” of a
capitalist economy? Develop a succinct explanation of Marx’s argument surrounding these
“laws,” and explain the forces leading to the conclusion reached by Marx.
13.
The concept of surplus is fundamental for Marxian economic theory. Define this concept in
Marxian theory by explaining: (a) what is the source of surplus, (b) how does the concept of
surplus give rise to the concept of exploitation, (c) what is the role of surplus in the Marxian
theories of distribution, reproduction, and crisis.
14.
Marx argued that a capitalist economy should be conceived of as an ongoing process of
economic reproduction. Explain what is meant by the term ‘reproduction’, summarize
Marx’s theory of economic reproduction, and describe some of the conditions under which
this reproduction might fail. Finally, Marx further proposes that the process of capitalist
reproduction produces not only commodities but also the capitalist social relations. Explain
what he meant by this statement.
15.
A fundamental concept of institutional economics is what has come to be called the Veblenian
dichotomy. First, explain, in detail, the Veblenian Dichotomy, including its structure and its
component parts. Then discuss
a. its historical background,
b. how it fits into institutional thought,
c. how it is used to examine economic and social phenomena.
16.
Discuss Veblen’s concept of business enterprise. Explain the degrees of separation (1st and
2nd). What is the importance of each and what role does each play in influencing economic
forces. You may also include a discussion of the evolution of business enterprise from
handicraft to industrial and you may also make use of the model of the going concern.
17.
Can Marx be said to have held a “breakdown theory” for capitalism? Why or why not? In
your answer be sure to discuss Marx’s theory of reproduction as well as his theories of
capitalist crises. Also discuss Marx’s general methodological precepts and how they might
influence his thing on long-run deterministic tendencies.
Part II : Interrelationships of Micro, Macro and Political Economy
1.
Given the existence of institutions, structures and agency, is it possible to theorize about
macroeconomic economic outcomes? Discuss.
16
2.
Compare and contrast the theoretical positions of each of the following schools of thought
regarding the relationship between saving and capital accumulation:
a.
b.
c.
d.
Classical
Post Keynesian
Institutionalists
Neoclassical
3.
Critically examine the following statement: “The marginal productivity of labor determines
the equilibrium wage”. You should examine the statement from a microeconomic perspective,
a macroeconomic perspective, and a political economy perspective.
4.
It has been argued that the “the machine question” has had a profound impact on economic
thought.
a. Briefly explain your understanding of the machine question.
b. Give specific examples of the ways it emerges, explicitly or implicitly in the work of
(i) classical economics (e.g., Ricardo), (ii) Marx, (iii) Veblen, and (iv) Keynes.
c. Identify and discuss an example of the impact of the machine in contemporary
economic activity and policy.
5.
Production as a circular process, cumulative causation, the economy as a social organism, and
a class society ensure that economic activity and the social provisioning process are affected
by political activity. Discuss.
6.
Critically evaluate the following claim: “The ‘free market’ versus ‘government intervention’
dichotomy is a useful one for understanding debates about political economy, as well as for
understanding real world economies.”
7.
The profit mark up is affected by the realization problem of effective demand, the micro
problem of competition, the political economy problem of government regulation, and the
institutional problem of custom and tradition. This makes a theory of the mark up impossible,
so it is best that heterodox economists just assume the profit mark up given or say that it is
determined by the price elasticity of demand. Discuss.
8.
What theoretical differences for economic theory emerge when economics is defined as the
science of social provisioning as opposed to the allocation of scarce resources among
competing ends?
9.
A state-money monetary production economy is inherently a microeconomic concept.
Discuss.
10.
In the absence of the traditional distinction between micro and macro, evaluate the following
statement: macroeconomic outcomes have their microfoundations in social relationships,
social conventions, and power.
17
11.
Capitalism is simply feudalism with markets. Discuss.
12.
Deficit spending (both by government and by capitalists) in a monetary production is a
mechanism through which claims are exercised on production. To secure those claims,
control over the economic and political future of society must also be enforced. Analyze the
above statement, incorporating in your answer the theoretical positions of Marx, Veblen, and
Keynes.
13.
Compare and contrast: a) Marx’s “M-C-M’” approach to capitalist production; b) Keynes’s
“Monetary theory of Production” approach; and c) Veblen’s “Theory of Business
Enterprise”.
14.
Orthodox economics uses the concept of equilibrium as the basis for much of its analysis.
Heterodox economics has objected to the use of equilibrium methodology for a variety of
reasons. For example, Joan Robinson argued for “history” rather than “equilibrium”. Many
followers of Keynes reject the notion that economic forces lead to an equilibrium defined as
“market clearing”, although some accept an alternative notion of equilibrium. Some
heterodox economists reject any notion of equilibrium. Critically examine the use of
equilibrium in economics from the vantage point of microeconomics, macroeconomics,
political economy, and methodology. In your essay, analyze alternative definitions of the
term; discuss uses of the term; explain where the concept might be most appropriately used,
and where it is most inappropriately applied; and summarize arguments used to support the
concept as well as those used to reject the concept.
17.
In economic theory, there is a tension between forces that produce a harmony of interests in
the economy versus forces that concentrate power in the hands of a minority that uses the
economy in its own interests. Compare/contrast the orthodox approach to these issues with
that of the heterodox approach. Be sure to look at both the micro-level forces as well as the
macro-level forces; and include discussion of economic phenomena (narrowly defined) as
well as socio-political phenomena.
18.
Schumpeter’s ‘creative destruction’ is an apology for big business. Discuss.
17.
A disaggregated price-quantity model of the economy is neither a microeconomics nor a
macroeconomic concept, but most certainly is related to political economy. Discuss.
18.
Paul Davidson and G.L.S. Shackle both argue that the real world is not an ergodic stochastic
process. Marx, on the other hand, was profoundly influenced by dialectics and held a
dialectical view of the world. Do you see these two visions of the world, i.e. these two
social ontologies, as complimentary or contradictory? In your answer give examples of how
these two approaches inform the economic theories that are influenced by them.
19.
Macroeconomics with extreme aggregation adopted by many heterodox/Post Keynesian
18
economists is based on a prior political decision to promote capitalism and its harmony of
interest. Discuss.
20.
Marx, Veblen, and Keynes all held that under a system of laissez-faire capitalist economies
typically are characterized by sustained unemployment. But these theorists point to different
causes as the source of this unemployment. Explain:
a.
Why, according to Marx, Veblen and Keynes, does persistent unemployment exist in
capitalist economies? Be sure to identify the position associated with each theorist,
and to distinguish among their positions where appropriate.
b.
What are the solutions for unemployment according to Marx, Veblen, and Keynes?
What are the similarities and differences among Marx’s, Veblen’s, and Keynes’s
prescriptions for dealing with unemployment?
21.
In heterodox economics the exchange of products is not based on any homogeneous entities (such as
labor or utility) inherent in the products, but on a Chartalist theory of money and social provisioning.
Discuss.
22.
Macroeconomics with extreme aggregation adopted by many heterodox/Post Keynesian economists
is based on a prior political decision to promote capitalism and its harmony of interest. Discuss.
Organization of the Qualifying Examination in
Econometrics
There are typically four multi-part questions on the qualifying exam in econometrics. They are
chosen from a list of questions available on the department website (and which are reprinted
below). Students must answer all questions.
Review Questions for Quantitative Qualifying Exam - Econometrics
1. Define the term sampling distribution. Given the assumptions of the Classical Linear Regression
Model for a simple regression, what is known with respect to the sampling distribution of ̂ ?
Explain.
2. Use matrix algebra to prove that least squares estimators of the coefficients of a general multiple
regression model are unbiased even when some of the CLRM assumptions are not met. Your
proof should show which of the assumptions must hold and which need not. Be sure to define all
terms.
3. Derive the variance covariance matrix of ̂ .
4. Explain the differences between heteroskedasticity and autocorrelation. Under which circumstances is one most likely to encounter each of these problems. Explain in general, the procedure
for dealing with each. Do these techniques have anything in common? Explain.
19
5. Two issues associated with the statistical analysis of time series data are autocorrelation and
distributed lags.
a. What is the conceptual difference between these two issues?
b. Explain one method for dealing with the autocorrelation generated by a first order
autoregressive scheme.
c. Explain, in general, the process which must be followed to make a distributed lag model
estimable.
6. What is the purpose of the Cramer-Rao inequality. Explain its derivation.
7. Identify two situations in which correlation of a right hand variable with the error term of an
equation is likely to be present. What desirable qualities do least squares estimators have under
such circumstances? Explain. Outline a method which results in estimators with at least one
desirable characteristic for one of the situations.
8. Assume a system of simultaneous equations with 3 endogenous variables (X,Y,Z) and 4
predetermined variables (B,C,D,F).
a. Using the order condition for identification, create structural equations for the model such that
one structural equation is exactly identified, one structural equation is underidentified and one
structural equation is over-identified. Be sure to indicate the identification status of each
structural equation.
b. Write the reduced form equations of your model.
c. Explain why it is impossible to derive consistent estimators for an underidentified structural
equation.
9. Suppose you are analyzing a state income tax revenue function. You have data from the 40 states
with state income taxes and for each state, you have fifteen years of data. Your model is as
follows:
yit = 1Xit,1 + 2Xit,2 + 3Xit,3 + · · · + kXit,k + it
where yit = state income tax revenue for state i in year t;
Xit,1 = a vector of 1's;
Xit,2, Xit,3, · · ·, Xit,k = explanatory variables;
it = random disturbance for state i in year t.
a. Make a complete set of assumptions with respect to the disturbances which you feel is realistic
in the context of this model. Be sure to explain each assumption.
b. Provide a methodological explanation for the technique you would use to estimate the
parameters of the model, based on the assumptions made in a, above.
10. Summarize this computer output which results from applying the iterative Prais-Winsten
procedure to the simple form of the quantity theory of money, using quarterly data from 1952, I
– 1956, IV. Your summary should include a brief statement as to the meaning of each term
(SSE, etc), an interpretation of the final set of parameter estimates and an explanation of all
relevant hypothesis tests.
SAS
AUTOREG PROCEDURE
20
DEPENDENT VARIABLE = CONSEXP (Consumer Expenditure)
ORDINARY LEAST SQUARES ESTIMATES
SSE
MSE
REG RSQ
DURBIN-WATSON
VARIABLE DF
INTERCPT 1
MONEYST 1
(Money Stock)
285.5109 DFE
18
15.86172 ROOT MSE 3.982677
0.9573
0.3282
B VALUE
STD ERROR T RATIO APPROX PROB
-154.719162 19.8500323 -7.794
0.0001
2.300371
0.1145583
20.080
0.0001
UNCONDITIONAL LEAST SQUARES ESTIMATES (PRAIS-WINSTEN)
SSE
MSE
REG RSQ
DURBIN-WATSON
89.74361 DFE
17
5.279036 ROOT MSE 2.297615
0.8232
1.4913
VARIABLE DF
B VALUE
INTERCPT 1
MONEYST 1
A(1) 1
-154.227764
2.309733
0.893551
STD ERROR T RATIO APPROX PROB
54.0997922 -2.851
0.3180847 7.261
0.1574501 5.675
0.0111
0.0001
0.0001
11.
21
a. Explain briefly and in your own words the algorithms of least squares, BLUE and Maximum Likelihood estimation. Your
explanations should be general. Do not derive any particular estimators mathematically as a part of your explanation.
b. What information is yielded by the BLUE procedure as applied to the estimation of regression coefficients, which is not yielded by
the LSE procedure? Why is this so?
c. What information is yielded by the Maximum Likelihood procedure as applied to the estimation of regression coefficients, which is
not yielded by the LSE or BLUE procedures? Why is this so?
12. A regression model is specified as Yi = Xi + i, where  and X satisfy all of the assumptions of the classical linear regression model. The
following estimator has been proposed:
Y
 =
X
Note that if Yi = Xi + i, then Y =  X +  .
a. Prove that this estimator is unbiased and consistent.
b. What steps would you take to determine whether or not the estimator is efficient? You do not have to actually determine whether or
not it is efficient. Just outline the procedure you would follow.
13. The following ten lines show the derivation of the variance of the least squares estimator for a in a simple regression model
Yi =  +  Xi + i . Justify each line. Your grade will depend upon the completeness of your justifications.
1.  -  = Y -  X - 
2.
3.
=  + X +  -  X - 
= - X( - ) + 
4. Var( ) = E[ - E( ) ]
2
= E( -  )
5.
2
6.
= E[-X( - ) +  ]
2
2
2
7.
= E[ X ( -  ) +  - 2X( - )]
2
2
2
8.
= X E( -  ) + E( ) - 2X E( - )
2
22
9.



2
= X 
+ 0
2  +
n
 (Xi - X ) 
10.
2
1

X
= 2  +
2 
(Xi - X ) 
n
2
2
14. Autocorrelation
a. What problems are caused by an autocorrelated disturbance in the context of OLS? Explain why these problems exist in general
terms.
b. What is the general idea behind all procedures which attempt to deal with an autocorrelated disturbance?
c. Explain the advantage which the Prais-Winsten (two-step or iterative) method has over methods such as Cochrane-Orcutt and HildrethLu, when dealing with autocorrelated disturbances.
15. Heteroskedasticity
a. What problems are caused by a heteroscedastic disturbance in the context of OLS? Explain why these problems exist in general terms.
b. What is the general idea behind all procedures which attempt to deal with heteroscedastic disturbances?
c. Assume a simple regression model of the form Yi = Xi + i. All of the assumptions of the CLRM are met with the exception that
E(i²) = i² = a + bXi + cXi2
Assume that a, b and c are known. Propose a transformation of the original model which would result in a model with a homoskedastic
disturbance.
d. Prove that the transformed model in b. above has a homoskedastic disturbance.
16.
Consider the model: Yi = Xi + i, where Xi is stochastic but independent of i and i
satisfies all basic assumptions. Suppose that a researcher mistakenly applies the least squares method to Xi = Yi + ui and then uses 1/
as an estimator for . Prove that 1/ is not a consistent estimator for .
HINT: Examine the relationship between Yi and ui.
If Yi = Xi + i, then Xi = 1/Yi + 1/i
23
For the model: Qai =  +  Pai + ui ; where
Qai is the daily quantity demanded of artichokes in supermarket i;
Pai is the price of an artichoke in supermarket i, measured in cents;
a national survey of 100 supermarkets is commissioned to an econometric consulting firm by the Artichoke Marketing Board (AMB).
The firm writes a report of the results, but a disastrous earthquake destroys all of the data and the report. One page survives with the
following information:
17.
(Qa - Qa ) = 57858 (Pa - Pa ) = 208292 (Qa - Qa)(Pa - Pa) = 104146 Pa = 80 Qa = 460
a. Provide the following: RSS, Standard Error of the Model,  ,  , SE , SE , R2
b. Conduct the standard test of significance for .
c. Interpret you estimators for  and , and explain what is meant by the value calculated for R² in a above.
d. Calculate a 95% confidence interval for the average daily quantity demanded of artichokes for a store which sets its price at $1.00.
e. What does your answer to part c above mean?
2
18.
2
a. Define heteroskedasticity.
b. Why is heteroskedasticity a problem in the context of least squares estimation?
c. Specify a model which you believe to be heteroskedastic and explain the nature of the heteroskedasticity.
19. A model estimated produced the output on the following two pages.
a. What is the model that is estimated?
b. Explain the derivation of the F value of 374.547. No calculations are necessary.
c. Test the hypothesis that FP = CI versus the alternative that FPCI.
d. What additional information would you need to test the hypothesis that bFP=bCI=0?
e. How would one go about finding the impact of a change in FP on F?
f. What additional information would you need to construct a confidence interval for the forecast value of an individual F?
Dependent Variable: F
Source
Model
Error
C Total
LOG OF FOOD CONSUMPTION PER CAPITA
Analysis of Variance
Sum of
Mean
DF
Squares
Square
3
0.10425
0.03475
26
0.00241
0.00009
29
0.10666
F Value
374.547
Prob>F
0.0001
24
Root MSE
Dep Mean
C.V.
Variable
INTERCEP
FP
CI
INTERACT
COVB
INTERCEP
FP
CI
INTERACT
DF
1
1
1
1
0.00963
4.54195
0.21207
R-square
Adj. R-sq.
0.9774
0.9748
Parameter Estimates
Parameter
Standard
T for H0:
Estimate
Error
Parameter=0
8.028977
1.79812427
4.465
-0.996251
0.39701365
-2.509
-0.718393
0.43242506
-1.661
0.211185
0.09513157
2.220
Covariance of Estimates
INTERCEP
FP
CI
3.2332508738
-0.713560649
-0.774093462
-0.713560649
0.1576198366
0.1704192333
-0.774093462
0.1704192333
0.1869914286
0.1706307872
-0.037597809
-0.041119937
Prob > |T|
0.0001
0.0187
0.1087
0.0354
INTERACT
0.1706307872
-0.037597809
-0.041119937
0.0090500152
INTERCEPT
LOG OF FOOD PRICE
LOG OF CONSUMER INCOME
FP*CI
Intercept
LOG OF FOOD PRICE
LOG OF CONSUMER INCOME
FP*CI
25
20.
a. Explain in general terms the weighted least squares estimating method. Your
explanation should include the context in which it is used, and what information
is necessary to be able to use it.
b. Assume a model of the following form:
Yi = 1X1i + 2X2i + 3X3i + ui
which has a heteroskedastic disturbance. Assume that the heteroskedastic disturbance is generated by the following equation: i² = kX2i. Perform the transformation necessary to make the model homoskedastic.
c. Assume a model of the following form:
Yi = Xi + ui
which has a heteroskedastic disturbance. The model is estimated using Ordinary
Least Squares, yielding ̂ and ̂ and estimated SE ̂ and SE ̂ . Then the model
is estimated using Weighted Least Squares, yielding â and b̂ and estimated
SE â and SE b̂ . Would you expect ̂ and ̂ to be significantly different from â
and b̂ ? Would you expect estimated SE ̂ and SE ̂ to be significantly different
from estimated SE â and SE b̂ ? Explain.
21.
a. Describe first order autocorrelation. Your description should include all relevant
assumptions.
b. What does autocorrelation have in common with heteroskedasticity? Your
answer should list and explain at least three factors.
22.
Suppose that the variable Y is a dichotomous variable. Prove that the disturbance of
the model Yi =  + Xi + i is heteroskedastic.
23.
Two issues associated with the statistical analysis of time series data are
autocorrelation and distributed lags.
a. What is the conceptual difference between these two issues?
b. Explain, in general, the process which must be followed to make a distributed
lag model estimable.
c. Explain one specification of a distributed lag model, including the estimation
procedures to be used and a summary of the properties of the estimator (no
proofs necessary).
26
24. Assume a consumption function of the following form:
Ct = ß0+ ß1Yt + ß2Rt + ut
where
Ct is real personal consumption expenditures in year t
Yt is real disposable personal income in year t
Rt is the interest rate in year t of corporate bonds rated Aaa
a. Specify a new model based on the assumption that autonomous consumption (the
intercept) is different in war years than in non-war years.
b. Specify a new model based on the assumption that marginal propensity to consume
is different in war years than in non-war years.
c. Specify a new model based on the assumption that both autonomous consumption
and the marginal propensity to consume are different in war years than in non-war
years.
d. Based on your answer to part c, what would your equation look like in war years? In
non-war years?
25. Estimation of the model Yt = ß1 + ß2X2t + ß3X3t + ß4X4t + et from a sample of 104
observations yields:
 5.0  1.4  2.0
4.8


1
ˆ
X' X    1.4 20.0  7.5 e'e  20 β  4.0
 2.0  7.5 45.0 
3.6
a. Which of the explanatory variables has a statistically significant impact on Y, based
on a t test criterion. Show how you arrive at your conclusions. (10 points)
b. Test the hypothesis that ß3 = ß4. (10 points)
c. Construct and interpret a 95% confidence interval for ß3 + ß4. (10 points)
d. With the information provided, is it possible to test the hypothesis that
Ho: ß2 = ß3 = ß4 = 0? Explain. (10 points)
26. Multicollinearity is a problem frequently encountered in econometrics.
a. Explain the nature of the problem.
b. What is it that distinguishes multicollinearity from the other types of problems
which we have discussed?
27
27. Explain how seemingly unrelated equations are in fact related according to the seemingly unrelated regression model. Assume that a SUR approach is relevant to an
econometric analysis of advertising behavior by three large microcomputer companies
(APPLE, COMPAQ and DELL). Make a complete set of assumptions regarding the
random disturbances of the equations in the model and show the variance-covariance
matrix of disturbances which results from your assumptions.
28. Why is it necessary to develop alternative estimating procedures for the parameters of
equations which are a part of a system of simultaneous equations? Explain the twostage least squares estimating algorithm. Your explanation should include the
circumstances under which it is applicable.
29. Define autocorrelation. What are the principal consequences of autocorrelation for OLS
estimators? Why are these consequences important?
30. Prove that d  2(1 -  ) , where d is the Durbin-Watson statistic and  is an estimator
for  (the first order autocorrelation parameter).
31. If you were given f(X,Y), i.e., the joint probability distribution of the variables X and Y,
how would you go about determining if X and Y are probabilistically independent?
32.You are an econometrician working for KCPL. Your boss asks you to come up with a
95% confidence interval for the mean monthly residential consumption of electricity (in
KWHs) per household. You take a random sample of the monthly bills of 121
residences with the following results:
Sample mean = 550 KWHs S2 = 12,100 KWHs2
a. Construct the relevant confidence interval.
b. Explain the statistical meaning of this confidence interval.
c. Use the information above to test the hypothesis that mean monthly sales of
electricity is equal to 500 KWHs versus the alternative that it is greater than
500.
33. What is meant by the term "statistical inference?" Explain the role of the sampling
distribution in statistical inference. Your explanation should include a definition of
sampling distribution.
34. Comment on the following assertion: "Least squares regression is only useful for
estimating linear relationships among economic variables."
35. Assume a model of the following form: Yi =  + Xi + ui
which has a heteroskedastic disturbance generated by the following specification:
2i = kX2i .
a. What procedure would you use to estimated the model?
b. Compare the results of estimating the model with OLS versus the method you
described in a, above, with regard to both parameter estimates and estimated
parameter standard errors. Explain.
28
36.
Compare the 2SLS method with the 3SLS method. What must be true regarding
the identification status of the structural equations for 3SLS to be applicable? What
advantage is gained by using 3SLS vs. 2SLS?
37. Explain how seemingly unrelated equations are in fact related according to the seemingly unrelated regression model. Assume that a SUR approach is relevant to an
econometric analysis of advertising behavior by two large microcomputer companies
(COMPAQ and DELL).
a. Make a complete set of assumptions regarding the random disturbances of the
equations in the model. Justify each assumption (10 pts).
b. Show the variance-covariance matrix of disturbances which results from your
assumptions. (10 pts)
c. Outline a strategy for estimating the parameters of this model (10 pts)
38. Suppose that you have data from a cross section of 50 observations for a given period
of time (say, 2003) for the model y=X ß + . The same data set becomes available for the
next year (2004). Assume:
1.
E ( it )  0
2.
Var ( it )   i2
3.
E ( it  jt )  0
first degree autocorrelation with the same ρ for each cross sectional unit; i.e.
5.
 i 2004   i 2003  ui 2004
E ( i 2003ui 2004 )  0
6.
E (uit )  0
4.
i  1, 2,...,50
7.
Var (uit )   ui2
a. What would the vector of disturbances (look like? (10 points)
b. What would Ω look like? (15 points)
39.
What is the conceptual difference between spatial autocorrelation and a spatial
lag? Your answer should include an example of each.
40.
Present arguments for and against the following statement:
Spatial econometric models are inherently more complex than time series
econometric models.
29
Reading List
IPh.D. Qualifying Examination
Department of Economics
University of Missouri-Kansas City
ECONOMIC THEORY
The readings below are in addition to the course readings in Econ 501, 502, 506, 551, 601,
602, and 688. The readings are intended to broaden and deepen your understanding of
heterodox economic theory
Journals
You need to be familiar with the content for the following journals for at least the past 10
years:
Cambridge Journal of Economics
Capital and Class
Contributions to Political Economy
Feminist Economics
Journal of Economic Issues
Journal of Post Keynesian Economics
Rethinking Marxism
Review of Political Economy
Review of Radical Political Economics
Review of Social Economy
Economics Philosophy
European Journal of the History of Economic Thought
History of Political Economy
Journal of Economic Methodology
Journal of the History of Economic Thought
Capitalism, Nature, and Socialism
Journal of Institutional Economics
Science and Society
Encyclopedic Overviews of Heterodox Economics
P. Arestis and M. Sawyer, The Elgar Companion to Radical Political Economy
J. E. King, The Elgar Companion to Post Keynesian Economics
G. M. Hodgson, W. J. Samuels, and M. R. Tool, The Elgar Companion to Institutional
and Evolutionary Economics
J. Peterson and M. Lewis, The Elgar Companion to Feminist Economics
P. A. O’Hara, Encyclopedia of Political Economy
Political Economy and Methodology
Karl Polanyi The Great Transformation
30
James Caporaso & David Levine Theories of Political Economy
Charles Whalen Readings in International Political Economy
Adam Smith An Inquiry into the Nature and Causes of the Wealth of Nations
David Ricardo The Principles of Political Economy and Taxation
John S. Mill Principles of Political Economy
Karl Marx , Capital, vols 1 -3
J. K. Galbraith A Life in Our Times
M. C. Howard & J.E. King The Political Economy of Marx
Michael Perelman Classical Political Economy
C. Wright Mills The Power Elite
G. William Domhoff The Power Elite and the State
A. Lowe, The Path of Economic Growth
M. Pivetti, An Essay on Money and Distribution
C. Panico, Interest and Profit in the Theories of Value and Distribution
M. Dobb, Theories of Value and Distribution since Adam Smith
G. C. Harcourt, The Social Science Imperialists, chs. 8, 14, 15, 16, 17, 18, and 19, Capitalism,
Socialism and Post-Keynesianism, chs. 4, 5, 6, 7, and 8
J. Steindl, Maturity and Stagnation in American Capitalism
P. M. Lichtenstein, An Introduction to Post-Keynesian and Marxian Theories of Value
and Price
Wassily Leontief, "Theoretical Assumptions and Nonobserved Facts," AER, March, 1971
J. B Davis "Distribution in Ricardo's Machinery Chapter", History of Political Economy,
Fall 1989
Ben Seligman "The Impact of Positivism on Economic Thought" History of Political
Economy, Fall 1969
Jerry Evensky "The Evolution of Adam Smith's Views on Political Economy", History of
Political Economy, Spring 1989
M. Baranzini and R. Scazzieri, Foundations of Economics
J. E. King, A History of Post Keynesian Economics
M. A. Ferber and J. A. Nelson, Feminist Economics Today
D. K. Barker and E. Kuiper, Towards a Feminist Philosophy of Economics
D. F. Ruccio and J. Amariglio, Postmodern Moments in Modern Economics
S. A. Resnick and R. D. Wolff, Knowledge and Class
R. Hilferding, Finance Capital
P. Sweezy, The Theory of Capitalist Development
M. Berg, The Machinery Question and the Making of Political Economy, 1815-1848
G. Dalton, Primitive, Atchaic and Modern Economies: Essays of Karl Polanyi
Althusser, Louis and Etienne Balibar. Reading Capital,
Marglin, Stephen A.“What Do Bosses Do?”. Review of Radical Political Economics,
volume 6(2), Summer 1974.
Dobb, Maurice. 1946. Studies in the Development of Capitalism.
Hilton, Rodney, ed. 1976. The Transition from Feudalism to Capitalism.
M.C. Howard and J. E. King, A History of Marxian Economics, 2 vols.
Institutional Theory
Marc Tool Essays in Social Value Theory
John R. Commons, Institutional Economics: Its Place in Political Economy
John Dewey, The Quest for Certainty
31
_____, Human Nature and Conduct
Thorstein Veblen, The Theory of Business Enterprise
_____, The Theory of the Leisure Class
C. E. Ayres The Theory of Economic Progress
Carl Becker The Heavenly City of the Eighteenth-Century Philosophers
Marc Tool, Editor, Foundations of Evolutionary Economics, Volume I.
J. K. Galbraith, The New Industrial State
_____ Economics of the Public Purpose
A. Gruchy, Modern Economic Thought, The Reconstruction of Economics
D. Hamilton, Evolutionary Economics
G. Hodgson, Economics and Institutions, How Economics Forgot History, The Evolution
of Institutional Economics
M. R. Tool, The Discretionary Economy
M. R. Tool, Pricing, Valuation and Systems
W. J. Samuels, The Founding of Institutional Economics
Brian Arthur, "Positive Feedbacks in the Economy" Scientific American, Feb. 1991
Paul David, "Clio and the Economics of QWERTY," American Economic Review, May 1985.
John Munkirs with Janet Knoedler, “The Existence and Exercise of Corporate Power: An Opaque
Fact” Journal of Economic Issues, December 1987.
John Munkirs, "The Dichotomy: Views of a Fifth Generation Institutionalist," Journal of
Economic Issues, December, 1988.
James Sturgeon, “Induction and Instrumentalism in Institutional Thought” Journal of Economic
Issues, June 1984.
William T. Waller Jr., "The Evolution of the Veblenian Dichotomy: Veblen, Hamilton, Ayres,
and Foster," Journal of Economic Issues, September, 1982.
Wilber, C. K. and Harrison, R. S. 1978. "The Methodological Basis of Institutional
Economics: Pattern Model, Storytelling, and Holism." Journal of Economic Issues 12
(March): 61 - 89.
Ken Dennis, Boland on Friedman, Journal of Economic Issues, September, 1986
Robert Montgomery, "Historical Fact" Unpublished Paper
Thorstein B. Veblen "Why is Economics Not and Evolutionary Science"
_____, "The Limitations of Marginal Utility"
_____ , The Barbarian Status of Women
J. Fagg Foster, "The Theory of Institutional Adjustment" Journal of Economic Issues, Dec. 1981.
J. K. Galbraith, "Power and the Useful Economist," American Economic Review, March 1973
Robert Montgomery, "Historical Fact" Unpublished Paper
Yngve Ramstad, “’Reasonable Value’ vs. ‘Instrumental Value’” Journal of Economic Issues,
September 1989.
_____, “John R. Commons’s Puzzling Inconsequentiality,” Journal of Economic Issues,
December 1995.
William Dugger, “Veblenian Institutionalism: the Changing Concepts,” JEI, December 1995
William T. Waller Jr., “The Evolution of the Veblenian Dichotomy: Veblen, Hamilton, Ayres,
and Foster,” Journal of Economic Issues, September, 1982.
Warren Samuels “The present state of institutional economics” Cambridge Journal of
Economics 1995
P. O’Hara, Marx, Veblen, and Contemporary Institutional Political Economy
W. M. Dugger and H. J. Sherman, Reclaiming Evolution
D. P. Champlin and J. T. Knoedler, The Institutionalist Tradition in Labor Economics
32
Microeconomics
J. Robinson, Collected Economic Papers, Vols. I – V, The Accumulation of Capital
N. Kaldor, Economics without Equilibrium, Essays on Value and Distribution ch. 10,
Further Essays on Economic Theory, chs. 1, 7, and 8
A. S. Eichner, The Megacorp and Oligopoly, The Macrodynamics of Advanced Market
Economies
S. Moss, An Economic Theory of Business Strategy
J. M. Blair, Economic Concentration
A. Wood, A Theory of Profits
P. Sylos-Labini, Oligopoly and Technical Progress
E. Penrose, The Theory of the Growth of the Firm
H. Braverman, Labor and Monopoly Capital
M. Hollis and E. J. Nell, Rational Economic Man
A. Roncaglia, Sraffa and the Theory of Prices
K. Bharadwaj and B. Schefold, Essays on Piero Sraffa, chs. 1, 2, 3, 5, 6, 10, 11, 12, 13,
and 16
B. Schefold, Mr. Sraffa on Joint Production and Other Essays, part I and III
K. Bharadwaj, Themes in Value and Distribution, chs. 10 and 12
F. S. Lee, Post Keynesian Price Theory
P. Downward, Pricing Theory in Post Keynesian Economics.
H. Bortis, Institutions, Behaviour and Economic Theory: A contribution to ClassicalKeynesian political economy
M. A. Lutz, Economics for the Common Good.
Lawson, T. 1994. "The Nature of Post Keynesianism and its Links to other Traditions:
a realist perspective." Journal of Post Keynesian Economics 16.4 (Summer): 503 - 538.
M. Lavoie, Foundations of Post-Keynesian Economic Analysis.
Fuller, C. G. 1996. "Elements of a Post Keynesian Alternative to 'Household
Production'". Journal of Post Keynesian Economics 18 (Summer): 595 - 607.
Lavoie, M. 1994. "A Post Keynesian Approach to Consumer Choice." Journal of Post
Keynesian Economics 16 (Summer): 539 - 562.
Shapiro, N. 1988. "Market Structure and Economic Growth: Steindl's Contribution."
Social Concept 4.2 (June): 72 - 83.
D. P. Levine, "The Theory of the Growth of the Capitalist Economy," Economic
Development and Culture Change (1975): 47 - 74.
O’Boyle, E. J. 1996. Social Economics: Premises, Findings and Policies
T. I. Palley, Post Keynesian Economics
J. E. King (ed.), An Alternative Macroeconomic Theory: The Kaleckian Model and PostKeynesianEconomics
P. Arestis, The Post-Keynesian Approach to Economics
F. J. Cardim de Carvalho, Mr. Keynes and the Post Keynesians
M. C. Sawyer, Unemployment, Imperfect Competition and Macroeconomics: Essays in
the Post Keynesian Tradition
E. Nell, Prosperity and Public Spending, The General Theory of Transformational
Growth
J. Schwartz, The Subtle Anatomy of Capitalism, chs. 1, 14, 18, 19, 20, and 21
33
Foster, J. B. and Szlajfer, H. (ed.) 1984. The Faltering Economy, pp. 23 - 56, 198 - 213,
and 236 - 250.
M. C. Baddeley, Investment: Theories and Analysis
G. Mongiovi and F. Petri, Value, Distribution and Capital: Essays in honour of
Pierangelo Garegnani
T. Cozzi and R. Marchionatti, Piero Sraffa’s Political Economy: A centenary estimate
R. E. Lane, The Market Experience
L. L. Pasinetti, Structural Economic Dynamics
J. B. Davis, The Theory of the Individual in Economics: Identity and value
J. Potts, The New Evolutionary Microeconomics
H. D. Kurz, Theory of Production: A Long-Period Analysis
P. Baran and P. Sweezy, Monopoly Capital
B. Lucarelli, Monopoly Capitalism in Crisis
M. F. Guillen, et. al, The New Economic Sociology
R. Swedberg, Principles of Economic Sociology
Macroeconomics
Snowdon, Vane and Wynarczyk A Modern Guide to Macroeconomics
L. R. Wray Understanding Modern Money: the key to full employment and price stability
1998
Eichner, A Guide to Post Keynesian Economics Sharp, 1978
Holt and Pressman, A new guide to Post Keynesian economics, Routledge
Davidson, Money and the Real World, 1972 or 1978
E. Amadeo, Keynes Principle of Effective Demand
E. Amadeo and A. Dutt, Keynes’s Third Alternative: The Neo-Ricardian Keynesians and
the Post Keynesians
M. Milgate, Capital and Employment
H. Minsky, John Maynard Keynes
P. Davidson, Money and the Real World, Collected Economic Writings, Vol. 1 chs. 1, 7,
8, 9, 12, 17, 23, 24, 25, 26, and 39, Post Keynesian Macroeconomic Theory
P. J. Reynolds, Political Economy: A Synthesis of Kaleckian and Post Keynesian
Economics
D. M. Kotz, T. McDonough, and M. Reich, Social Structures of Accumulation
M. Kalecki, Theory of Economic Dynamics
J. Eatwell and M. Milgate (eds.), Keynes’s Economics and the Theory of Value and
Distribution
S. Rousseas, Post Keynesian Monetary Economics
A. Asimakopulos, Investment, Employment and Income Distribution
J. A. Kregel, The Reconstruction of Political Economy: An Introduction to PostKeynesian Economics
S. C. Dow, Macroeconomic Thought
J. O’Connor, The Fiscal Crisis of the State
L.-P. Rochon and S. Rossi, Modern Theories of Money
H. Minsky, Stabilizing an Unstable Economy
34
Readings By Topic
GROWTH
Domar, “Capital Expansion, Rate of Growth, and Employment”, Essays in the Theory of
Economic Growth, 1957.
Walker and Vatter, “Why has the US operated below potential?” JPKE, spring 1989
Pigeon and Wray, “Demand Constraints and the New Economy”, manuscript.
Gordon: “Does the new economy measure up to the great inventions of the past:?” JEP
14(4) 2000.
Madrick: The end of affluence: the causes and consequences of America’s economic
delimma, Random House 1997.
ISLM AND DISEQUILIBRIUM ECONOMICS
Poole: “Optimal choice of monetary policy instruments in a simple stochastic macro
model” (QJE 1970)
Leijonhufvud: “Keynes and the Keynesians: a suggested interpretation”; “Keynes and the
classics: two lectures”, On Keynesian Economics and the Economics of Keynes (1966)
Hicks: “Mr. Keynes and the Classics” (Econometrica 1937), “Some Questions of Time in
Economics” (in Tang 1976), and “IS-LM: an explanation” (JPKE 1980-1)
Barro and Grossman: “A general disequilibrium model of income and employment”
(AER 1971)
SUPPLY SIDE AND MONETARISM, MARK I AND MARK II
Brunner, “The Role of Money and Monetary Policy”, FRB of St. Louis Review 50(7), Jul
1968
Gilder, Wealth and Poverty, 1981
Rousseas “Classical Supply-Side Economics”, in The Political Economy of Reaganomics
Balbach: “How controllable is Money Growth?” (FRB-St. Louis Review 1981)
Friedman: “A monetary and fiscal framework for economic stability” (in Essays in
Positive Economics, 1953), “The quantity theory of money—a restatement” (in Studies in
the Quantity theory of Money, ed. by Friedman, 1956), “The role of monetary policy”
(AER 1968), and “Quantity theory of money” (in The New Palgrave, 1987)
Tobin: “Friedman’s Theoretical Framework” (in Milton Friedman’s Monetary
Framework, ed. by Gordon, 1970)
Cooley and LeRoy, “Identification and estimation of money demand” (AER, 1981)
Sims: “Comparison of interwar and postwar business cycles: monetarism reconsidered”
(AER 1980)
Lucas: “Expectations and the Neutrality of money” (JET 1972), “Econometric Policy
Evaluation: a critique” (JME 1976)
Muth “Rational Expectations and the Theory of Price Movements” (Econometrica 1961)
Sargent and Wallace: “Rational expectations, the optimal monetary instrument, and the
optimal money supply rule” (JPE 1975)
35
REAL BUSINESS CYCLE, NEW KEYNESIAN
Taylor, “Staggered Wage Setting in a Macro Model”, AER 69(2) May 1979
Yellin, “Efficiency Wage Models of Unemployment”, AER 74(2) May 1984
King and Plosser: “Money, credit, and prices in a real business cycle” (AER 1984)
Kydland and Prescott: “Rules rather than discretion: the inconsistency of optimal plans”
(AER 1984)
Long and Plosser: “Real Business Cycles” (JPE 1983)
Plosser: “Understanding real business cycles” (JEP 1989)
Mankiw: “Real business cycles: a new Keynesian perspective” (JEP 1989)
Mankiw “A Quick Refresher Course in Macroeconomics”, JEL 28, Dec 1990
Blinder and Stiglitz: “Money, credit constraints, and economic activity” (AER 1983)
Bernanke: “Nonmonetary effects of the financial collapse in the propagation of the Great
Depression” (AER 1983)
Stiglitz and Weiss: “Credit rationing in markets with imperfect information” (AER 1981)
Greenwald and Stiglitz: Keynesian, new Keynesian and New Classical Economics,
Oxford Economic Papers 39, 1987.
Greenwald, Stiglitz, and Weiss: Informational imperfections in the capital market and
macroeconomic fluctuations, AEA papers and proceedings, may 1984.
Calomiris, Hubbard, and Stock: “The farm debt crisis and public policy” (Brookings
Papers 1986)
Caskey and Fazzari: “Macroeconomics and Credit Markets” (JEI 1986)
Gordon: “What is New-Keynesian Economics?” (JEL 1990)
Gray: “Wage indexation: a macroeconomic approach” (JME 1976)
Fischer: “Long-term contracts, rational expectations, and the optimal money supply rule”
(JPE 1977)
CRITIQUE OF ORTHODOXY
Chick: “Keynesians, Monetarists and Keynes: the end of the debate—or a beginning?”
(in Post Keynesian Economic Theory, ed. by Arestis and Skouras)
Harcourt: “Post-Keynesianism: quite wrong and/or nothing new?” (in Post Keynesian
Economic Theory, ed. by Arestis and Skouras), “Some Cambridge controversies in the
theory of capital” (JEL 1969)
Davidson: “A Keynesian view of Friedman’s theoretical framework for monetary
analysis” (in Milton Friedman’s Monetary Framework, ed. by Gordon, 1970)
Kregel: The Reconstruction of Political Economy (1973)
Eichner and Kregel: “An essay on Post-Keynesian theory: a new paradigm in economics” (JEL 1975)
Arestis: “Post-Keynesian economics: towards coherence” (CJE 1996)
Ormerod, “The Death of Economics Revisited”, manuscript, June 2000
Galbraith, “How the Economists got it Wrong”, www.prospect.org/archives/V117/galbraith-j.html
36
MONETARY THEORY OF PRODUCTION; ESSENTIAL PROPERTIES OF
MONEY
Keynes: “The process of capital formation” (EJ 1939); “A monetary theory of
production” (CW xiii)
Dillard: “A monetary theory of production: Keynes and the Institutionalists” (JEI 1980),
the Economics of John Maynard Keynes: the theory of a monetary economy (1948)
Wray: “The monetary macroeconomics of Dudley Dillard” (JEI 1993); “Saving, profits
and speculation in capitalist economies (JEI 1991); “Monetary theory and policy for the
twenty-first century” (in Political Economy for the 21st Century (ed by Whalen 1996),
Wray “Money and Inflation”, manuscript
Peterson: “Macroeconomics and the theory of a monetary economy” (in Political
Economy for the 21st Century (ed by Whalen 1996)
Fan-Hung: “Keynes and Marx on the theory of capital accumulation, money and interest”
(RESTUD 1939)
Cramp: “Two Views on Money” (Lloyd’s Bank Review 1962)
Davidson: Money and the Real World (1978), Post Keynesian Macroeconomic Theory
(1994); “Money and the Real World” (EJ 1972)
THE THEORY OF THE MONETARY CIRCUIT
Schumpeter: The theory of economic development (1949)
Minsky: “Schumpeter: Finance and Evolution” (in Markets and institutions in economic
development, ed. by Heertje and Perlman, 1990)
Bellofiore: “Money and development in Schumpeter” (RRPE 1985)
Graziani: “The theory of the monetary circuit” (Economies et Societes 1990)
Wray: “Government deficits, liquidity preference and Schumpeterian innovation”
(Economies et Societes 1994); “Money, interest rates, and monetarist policy” (JPKE
1993)
Lavoie: “Credit and money: the dynamic circuit, overdraft economics, and Post
Keynesian economics” (in Money and Macro Policy, ed. by Jarsulic 1985); “The
endogenous flow of credit and the Post Keynesian theory of money” (JEI 1984)
Rousseas: “The spheres of industrial and financial circulation revisited” (Economies et
Societes 1994)
CAMBRIDGE ECONOMICS, LONG RUN VS SHORT RUN, MODERN
MONEY
Garegnani: “Notes on consumption, investment and effective demand” (CJE 1978), “On
a change in the notion of equilibrium in recent work on value and distribution” (in
Keynes’s Economics and the theory of value and distribution, ed. by Eatwell and Milgate,
1983)
Eatwell: “Theories of value, output and employment” (in Keynes’s Economics and the
theory of value and distribution, ed. by Eatwell and Milgate, 1983)
37
Kregel: “Hamlet without the prince: Cambridge macroeconomics without money” (AER
1985)
Moore: “The endogenous money stock” (JPKE 1979); “Contemporaneous reserve
accounting: can reserves be quantity constrainted?” (JPKE 1984); “Wages, bank lending,
and the endogeneity of money" (in Money and Macro Policy, ed. by Jarsulic); “The
endogenous money supply” (JPKE 1988); and “Money supply endogeneity” (JPKE 1991)
Pollin: “Two theories of money supply endogeneity” (JPKE 1991)
Cottrell: “Post-keynesian monetary economics” (CJE 1994)
Wray: Understanding Modern Money (1998); “Modern Money”, in What is Money,
edited by John Smithin
Hudson: Public-sector vs. Individualist (and debt vs barter) theories of the origins of
money, manuscript
Ingham, “Babylonian madness: on the historical and sociological origins of money” in
What is Money, edited by John Smithin
FISCAL POLICY, FUNCTIONAL FINANCE, CROWDING-OUT,
GOVERNMENT DEBT
Lerner: “Functional finance and the federal debt” (Social Research, 1943)
Lerner “Money as a Creature of the State”, AER, 37(2) May 1947
Goodhart: “The two concepts of money: implications for the analysis of optimal currency
areas” (European jnl of Political Economy 1998)
Wray: Understanding Modern Money (1998)
Bell: "Functional Finance: What, Why, and How?" (Levy Working Paper 287, 1999);
"The Hierarchy of Money," (Levy Working Paper April 1998)
Innes: “What is money?” (Banking Law Jnl 1913)
Knapp: The State Theory of Money 1924
INTEREST RATES, MONETARY POLICY, LOANABLE FUNDS,
LIQUIDITY PREFERENCE
Keynes: “Alternative Theories of the rate of interest” (EJ 1937)
Townshend: “Liquidity premium and the theory of value” (EJ 1937)
Tsiang: “Liquidity preference and loanable funds theories, multiplier and velocity
analysis: a synthesis” (AER 1956)
Foley: “On two specifications of asset equilibrium in macroeconomic models” (JPE
1975)
Friedman, B.: “Crowding out or crowding in? Economic consequences of financing
government deficits” (Brookings Papers 1978)
Meyer: “The balance sheet identity, the government financing constraint, and the
crowding-out effect” (JME 1975)
Wray: “Government Deficits, Investment, saving and growth” (JEI 1989); “Alternative
theories of the rate of interest” (CJE 1992)
Bell: "Can Taxes and Bonds Finance Government Spending?" (Levy Working Paper 244
1998)
38
“Symposium on Central Banking Policy,” Journal of Post Keynesian Economics, 28.3
(Spring, 2006), articles by Arestis and Chortareas, Galbraith, Fontana, Sardoni and Wray,
Davidson, and Fullwiler
INFLATION, UNEMPLOYMENT, NAIRU
Appelbaum “The Labor Market”, (in Eichner A Guide to Post-Keynesian Economics
1979)
Galbraith “Dangerous Metaphor: the fiction of the labor market”, (Levy Public Policy
Brief 36, October 1997)
Sawyer “The political economy of the Phillips curve”, (Thames Papers in Political
Economy Summer 1987)
Davidson: “The demand and supply of labour” (in Post Keynesian Macroeconomic
Theory 1994)
Wray: “Money and Inflation” (manuscript); “Deficits, Inflation and monetary policy”
(JPKE 1997)
Kenyon: “Pricing” (in A guide to Post-Keynesian Economics, ed. by Eichner 1979)
Milgate and Eatwell: “Unemployment and the market mechanism” (in Keynes’s
Economics and the theory of value and distribution, ed. by Eatwell and Milgate, 1983)
Instability, Stabilization Policy
Minsky: Stabilizing an Unstable Economy (1986); “The financial instability hypothesis: a
restatement”, in Arestis and Skouras, Post Keynesian Economic Theory, 1985
Papadimitriou and Wray: “The economic contributions of Hyman Minsky: varieties of
capitalism and institutional reform” Review of Political Economy 10(2) 1998
Davidson: “Reforming the World’s Money” (JPKE 15(2) Winter 1992-3)
Wolfson: Financial Crises (1994)
Wojnilower: “The central role of credit crunches in recent financial history” (Brookings
Papers 1980)
Sherman: The Business Cycle (1991)
Gillman: Prosperity in Crisis (1965)
Kenway: “Marx, Keynes and the possibility of crisis” (in Keynes’s Economics and the
theory of value and distribution, ed. by Eatwell and Milgate, 1983)
Wray “Can the Expansion be Sustained: a Minskian view” Policy Note 2000/5
Godley and Izurieta “As the implosion begins”, Policy Note, Aug 2001.
INTERNATIONAL
Mundell, “A Theory of Optimum Currency Areas”, International Economics, 1968.
Royal Swedish Academy of Sciences, announcement of Nobel to Mundell, 1999
Davidson: “Reform of the International Financial System”
Goodhart: “The two concepts of money: implications for the analysis of optimal currency
areas” (European Journal of Political Economy 1998)
Thurow: Comparative advantage, factor-price equalization… in Whalen, Political
Economy for the 21st Century, Sharpe 1996
39
Amsden: Late industrialization, in Whalen, Political Economy for the 21st Century,
Sharpe 1996
McClintock, International trade and the governance of global markets, in Whalen,
Political Economy for the 21st Century, Sharpe 1996
40
APPENDIX
UNIVERSITY OF MISSOURI-KANSAS CITY
SCHOOL OF GRADUATE STUDIES
PREPARING FOR AND TAKING
DOCTORAL COMPREHENSIVE EXAMINATIONS
I.
PURPOSE OF COMPREHENSIVE EXAMINATIONS
II.
STRATEGIES TO PREPARE FOR THE EXAMS
III. STRATEGIES FOR TAKING THE EXAMS
IV. PERSONAL SELF-HELP STRATEGIES
V.
LIFE AFTER COMPS
PREPARED BY:
DR. LORA LACEY-HAUN
ASSOCIATE DEAN
SCHOOL OF GRADATE STUDIES
OCTOBER 2002
41
PURPOSE OF COMPREHENSIVE EXAMINATIONS
Comprehensive examinations are a traditional and important culminating and
synthesizing component of doctoral education. The concept of the comprehensive exam
has been used since the Middle Ages. Early in the 1900’s, comprehensive exams were
used in undergraduate programs and slowly they migrated to being a major component of
doctoral and many masters’ programs. The stated purposes of the comprehensive may
vary faculty to faculty and discipline to discipline. Primarily, they are designed to assess
the student’s competence and proficiency of a specified field of study and the methods of
inquiry in that field. It is a synthesizing experience that allows students to demonstrate
strengths in their areas of knowledge by applying that knowledge to situations of a broad
and conceptual nature. Various formats and structures are used to evaluate the student’s
mastery of knowledge within the field of study including, written and oral exams in
supervised settings, take home exams with an oral exam, written paper or proposal with
an oral defense. Of these formats, the ones most commonly used are written
examinations with an oral defense. The questions are designed to evaluate the depth and
breadth of the student’s ability to identify and analyze concepts, theories and arguments
within the field. The comprehensive exams may be the first opportunity for you to
demonstrate that you are a scholar in your field.
STRATEGIES TO PREPARE FOR THE EXAMS
There are several general strategies you need to consider when beginning to
prepare for your comprehensive examinations; faculty guidance, studying plans, and
organizing plans. The emphasis you may place on any one of these strategic areas will
depend on your discipline, your faculty, and your personal strengths and weaknesses. No
two sets of exams will be exact, and the approaches and testing formats used by the
disciplines will vary. Therefore, these strategies are offered as general guidelines and
approaches and not intended to replace the guidance and instructions received from you
discipline(s) and/or your faculty.
Faculty Guidance:
As a student you have the responsibility to contact your faculty or graduate
advisor to gather information that will give you direction in preparing for comprehensive
examinations. In order to grasp the scope of the exams you should request to meet with
the faculty responsible for writing and scoring your exams. You should make sure you
clearly understand what the examining committee expects from you in a comprehensive
exam.
 Begin preparing for the exams at least 6 – 9 months before the expected exam date
 What are the department’s requirements for registering, taking and reporting the
results of the exam
 What is the schedule for when the exams are offered
 How should you prepare
 Is there a recommended reading list
 Should the content be outlined in any logical way, or will the exam cover specific
areas of content within the discipline
42





What does each faculty consider the main elements you should be competent in
discussing (current discipline issues, theories, concepts, etc.)
When a faculty grades a comprehensive exam what type of responses are they
expecting
Are sample questions and answers available for review
Can you review answers that are well written as well as answers that are not
Should you take a directed readings course with a faculty to begin preparing for the
exams
Studying Goals & Plans:
The following strategies are offered as a way to think about how to put your arms around
the scope of this daunting activity.

Take command of the literature in you discipline
 Know the arguments/issues of the major writers in your discipline
 Read the past 3-5 years of literature in the disciplines top journals, unless
otherwise directed by your faculty
 Know the seminal work in your field and the relationship of that work to current
studies and thoughts

Organizing the literature
 Take notes on all readings – summarizing into 2 –3 paragraphs using note cards or
electronic resources such as EndNotes
 Create thematic categories from your readings –
 Compare and contrast major issues within the field
 Identify the major arguments in the field and know your position and why
 Develop a system to learn (not memorize) major authors and year of publication
 If allowed, prepare you citations for the exam – they should be typed, proofed,
spell-checked and ready to attach to your written exam.
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Studying
 Take practice comps with one or more committee members if possible
 Organize study groups – not to help you study but to help keep you focused – no
one can study for you – however, in a study group other issues may be identified
you overlooked or others may offer explanations to help clarify concepts, etc.
 Study for broad perspectives not for tiny details. The questions are broad and
there is not “right” or “wrong” answer. You need to rationally, logically, and
clearly articulate your position and justify that position with literature.
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Organizing your study materials and Study Plans
 Develop a notebook with the suggested following components
 Task list with Timetable –be sure and estimate the amount of time needed for
each task as well as the deadline for completing the task
 CompExam Guidelines
 Rules and regulations from the School of Graduate Studies and from your
discipline(s)
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Copy of completed/submitted form requesting to take exams
 Notes from meetings with faculty and graduate advisor
 Names and contact information of study partners
Major literature sources checklist. While you may have the literature sources
filed electronically, place in your notebook the reading list provided by faculty
and other bibliographical sources you need. If you develop this list as a multicolumn table you can mark that you have obtained the source, mark that you have
reviewed that source and maybe even document very briefly you disposition of
that source (in which category did you file the source.)
Materials needed to take to exams – in this section, again, develop a check sheet
of all materials you need to take with you on the day of your exam. You may be
required to take blue books, a calculator, etc. About 1 week before your
scheduled date, be sure you collect all items needed. If you have the opportunity
to take in pre-formatted answer sheets or a bibliography list get them prepared at
least one week in advance to reduce the psychological stress of preparing for the
exams.
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STRATEGIES TO TAKING FOR THE WRITTEN EXAMS
There are several things to attend to when you arrive to take your exams. First, be
sure you know the rules for taking breaks during the exam.
 Pre-writing Task: Once you are in the room ready to take the exam there are several
tasks you need to complete prior to even reading the first question.
 If you have not been allowed to bring in any materials (reference lists, preformatted disc, etc.) you want to take the first few minutes and list the major
reference you know you will want to cite during the exams. Also, take this time
to format the outline for your answers. This will help to reduce the anxiety as well
as get you organized so when you do begin answering the questions.
 Read the questions. Once you have read the questions, determined the ones that
you will answer, set a time limit for your self for each question. Follow this time
limit and pace yourself when writing the various sections that will answer your
questions. For example, if you have given yourself 90 minutes to answer one
question determine how much time you need to write the introduction and then be
sure you devote the majority of the time to answering the question. It is easy to
spend more time than needed on the “easy” parts of the answer. In fact, some
suggest that you write the introduction last so that you are sure you “introduce”
what you have chosen to address in the answer. Also, be sure and give yourself
time to review your answer so you can clarify any points that may not be as well
articulated as you would want.
 Tips for answering the question
 Re-read the question in its entirety to make sure you understand what is being
asked. Identify how many components are in the question that will need to be
addressed in the answer.
 Make an outline for how you will answer the question – if an outline doesn’t
work for your style write a brief abstract identifying the specific points to your
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answer then go and elaborate on those points. (KNOW WHAT WILL
WORK FOR YOU!!)
Answer the question – the nature of these questions requires that you write
extensive answers. How you organize, prioritize, and document you answers
will become the overarching activity that will facilitate you providing quality
responses. Provide a brief introduction, your main essay with supporting
documentation, have a point of view and defend it, write a conclusion and a
summary of what you included in your answer
Support your answer with literature
Use a clear format
Use empirical data whenever possible
FOLLOW DIRECTIONS - ANSWER THE QUESTION!!!
STRATEGIES TO TAKING FOR THE ORAL EXAMS
The oral component of the comprehensive provides you the opportunity to
demonstrate your ability to respond quickly to questions and to clarify and justify
answers you provided in your written exams. It also affords you the opportunity to
engage in an intellectual discussion with your examining committee such that you
demonstrate an understanding of the interrelationship of concepts, theories, etc. within
your discipline(s). You need to prepare psychologically for the oral exams just as you
did for the written exams. RELAX the day before and come into the exams mentally
rested and prepared.
 Review your written exams prior to the oral exams
 Contact faculty after they have had time to read your written responses and ask if
there are any particular areas from the written exam that you will specifically need to
clarify during the oral exams
 Beyond clarification of the written exams, ask what will be the focus of the oral exam
and what types of questions should you expect.
PERSONAL SELF-HELP STRATEGIES
 Have a positive attitude – comps are the opportunity for you to pull together all the
volumes of literature you have studied over the past 3 – 4 years. You are not doing
this merely as a task or hoop to get through the program – you are preparing yourself
for upcoming interviews you will have when seeking a new position.
 Do not take the exams if you are experiencing a major life crisis!
 Stop studying at least 24 hours before you schedule testing date. Relax, do something
special for yourself – get a massage, take a long walk, etc. Prepare yourself
psychologically!
 The day before the exam, be sure everything you need to take to the exam is gathered
and ready for you to take with you. The morning of the exam you want to minimize
the task you must do before you leave to take the exams.
 Don’t talk with you study partners or other students the day before the exam. This
will only lead to increasing your stress, as you will inevitably discuss issues,
arguments, etc.
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Get plenty of rest the week before your exam. Remember, it has been suggested that
it takes at least 2 hours of sleep to make up for 1 hour of lost sleep. If you are not at
your best mentally you will not perform your best regardless of what you know!
Eat a good meal the morning of your exams. You will need all the energy you can
store.
Arrive 15 – 30 minutes early for your exams. Do not push yourself to the last minute
arriving for the exams – you will only create unnecessary stress
LIFE AFTER COMPS!!!
Yes there is life after completing comps, but don’t get excited. It lasts only a short while.
Take at least 3 – 4 days off from your doctoral studies after completing the exams. But
don’t allow yourself to fall prey to the false sense of relief and completion. You need to
keep moving forward in preparing your proposal and implementing your dissertation. To
this point, you have had others set deadlines for you. Now, you are on your on. There is
no beginning and ending date for the different phases of your dissertation like when you
were enrolled in course work and knew the beginning date and ending date of each
semester.
Reward yourself after your completing your comps.
Reward yourself after finding out you passed your comps.
Celebrate each milestone of your doctoral education.
CONGRATULATIONS!
Resources:
Suggestions for Preparing for Comprehensive Examinations – The Notebook Method,
Brian L. Withrow. http://shus.edu/cjcenter/college/compstudyplan.htm
A Guide to Preparing for and Taking Comprehensive Examinations – University of
Oregon Department of Political Science.
Http://darkwing.uoregon.edu/~rmitchel/gradprogram/tip_comp.htm
Comprehensive Exam Advice. Http://www.unomaha.edu/~wwwpa/advice.html
Statement of Requirements – University of Pittsburgh.
Http://www.sis.pitt.edu/~dist/PhDGuide/phd9.html
Tips for Taking (and Passing) a comprehensive Examination – UWC Graduate Gateway.
http://reah.ucf.edu/~uwc/Grad%20Gateway/grad_level_writing/tips_comps.htm