Microeconomic Foundations of Reproductive Behaviour

Microeconomic Foundations of Clustering Behaviour in the New Economy

This paper presents a theoretical model explaining the clustering behaviour of firms in the New Economy (NE). A review of I-O literature reveals two views of clustering in the NE. While one view suggests clustering behaviour is more prevalent in the NE, largely because the generation and dissemination of knowledge is more conducive to firms in clusters, another view argues clustering may be les...

Does Macroeconomics Need Microeconomic Foundations?

I argue that it is microeconomics that needs foundations, not macroeconomics. Preferences need to be built on biology, and, in particular, on neuroscience. In contrast, macroeconomics could benefit from rationalizations of aggregate economic phenomena by non-equilibrium statistical physics. Special issue Reconstructing Macroeconomics JEL: B22, B41, C82, D87

Macroeconomic Evidence and Microeconomic Foundations

Microeconomic Foundations of the Demographic Dividend

The potential economic returns to the demographic transition are high. As countries move from a steady state with high mortality and high fertility to an equilibrium with low mortality and fewer children, lower dependency ratios, higher investment in human and physical capital as well as increased female labor force participation contribute to economic growth. In this paper, we analyze the demo...

Microeconomic foundations of representative agent models by means of ultraproducts

This paper builds on a recent proposal for microeconomic foundations for “representative agents”. Herzberg [12] constructed a representative utility function for finite-dimensional social decision problems and since the decision problems of macroeconomic theory are typically infinite-dimensional, Herzberg’s original result is insufficient for many applications. We therefore generalise his resul...