''The Other Canon Foundation'' is a center and network for research of

heterodox economics Heterodox economics is a broad, relative term referring to schools of economic thought which are not commonly perceived as belonging to mainstream economics. There is no absolute definition of what constitutes heterodox economic thought, as it i ...

founded by

Erik Reinert Erik Steenfeldt Reinert (born 15 February 1949) is a Norwegian economist, with development economics, economic history and history of economic policy as his specialties. Biography Reinert was born in Oslo, attended the University of St. Gallen ...

. The name refers to the founders' message of there being another economic canon, alternative to the ruling

neoclassical economics Neoclassical economics is an approach to economics in which the production, consumption, and valuation (pricing) of goods and services are observed as driven by the supply and demand model. According to this line of thought, the value of a go ...

. Their suggestions, they claim, are valid for and can be applicated in the first, second and third world.

History

The Other Canon was founded in 2000 by Erik Reinert and 10 co-founders with different backgrounds in economics and social sciences. The founders also have distinct backgrounds coming from North America, Latin America, Asia, Eastern and Western Europe. Notable names among them are

Wolfgang Drechsler Wolfgang Drechsler (born June 6, 1963 in Marburg, West Germany) is a Public Administration and Management, Innovation Policy and Political Philosophy scholar. He is Professor of Governance, and one of the founders and directors of the Technology G ...

Carlota Perez Carlota Perez (; born September 20, 1939, in Caracas) is a British-Venezuelan scholar specialized in technology and socio-economic development. She researches the concept of Techno-Economic Paradigm Shifts and the theory of great surges, a furthe ...

and

Geoffrey Hodgson Geoffrey Martin Hodgson (born 28 July 1946, Watford) is Emeritus Professor in Management at the London campus of Loughborough University, and also an editor of the ''Journal of Institutional Economics.'' Hodgson is recognised as one of the le ...

. In addition to the executive chairman Erik Reinert and the earlier mentioned Drechsler, the current executive board also employs Rainer Kattel.

Theories and influences

The ideological foundation of The Other Canon is not defined in a left-right perspective, claiming both sides have fallen into the same traps failing to explain and develop valid theories for today's economics. Central to the group is the Theory of Uneven Development, which aims to explain how and why the international economic landscape (of rich and poor nations) is as it is today. History of Economic Policy is used as an important tool in this process. The Other Canon is highly eclectic and gathers ideas from many authors of various epochs.

Joseph Schumpeter Joseph Alois Schumpeter (; February 8, 1883 – January 8, 1950) was an Austrian political economist. He served briefly as Finance Minister of Austria in 1919. In 1932, he emigrated to the United States to become a professor at Harvard Unive ...

John Maynard Keynes John Maynard Keynes, 1st Baron Keynes ( ; 5 June 1883 – 21 April 1946), was an English economist and philosopher whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments. Originall ...

Karl Marx Karl Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, political theorist, economist, journalist, and revolutionary socialist. He is best-known for the 1848 pamphlet '' The Communist Manifesto'' (written with Friedrich Engels) ...

Gunnar Myrdal Karl Gunnar Myrdal ( ; ; 6 December 1898 – 17 May 1987) was a Swedish economist and sociologist. In 1974, he received the Nobel Memorial Prize in Economic Sciences along with Friedrich Hayek for "their pioneering work in the theory of money an ...

Gustav von Schmoller } Gustav Friedrich (after 1908: von) Schmoller (; 24 June 1838 – 27 June 1917) was the leader of the "younger" German historical school of economics. He was a leading ''Sozialpolitiker'' (more derisively, ''Kathedersozialist'', "Socialist of ...

Werner Sombart Werner may refer to: People * Werner (name), origin of the name and people with this name as surname and given name Fictional characters * Werner (comics), a German comic book character * Werner Von Croy, a fictional character in the ''Tomb Rai ...

Nicholas Kaldor Nicholas Kaldor, Baron Kaldor (12 May 1908 – 30 September 1986), born Káldor Miklós, was a Hungarian-born British economist. He developed the "compensation" criteria called Kaldor–Hicks efficiency for welfare spending, welfare comparisons ...

Max Weber Maximilian Carl Emil Weber (; ; 21 April 186414 June 1920) was a German Sociology, sociologist, historian, jurist, and political economy, political economist who was one of the central figures in the development of sociology and the social sc ...

and

Adam Smith Adam Smith (baptised 1723 – 17 July 1790) was a Scottish economist and philosopher who was a pioneer in the field of political economy and key figure during the Scottish Enlightenment. Seen by some as the "father of economics"——— or ...

(for considerations of the primary sector) are among the theorists to have influenced The Other Canon. In accordance with Schumpeter, The Other Canon emphasizes the role of "man the producer" over "man the consumer" and intends to seek the reasons for growth and innovation rather than seeing it as something innate to capital and a simple result of adding it to human labour. They argue that the state is needed to stimulate entrepreneurship to maximise growth. The importance of role of the state is also underlined in development economics. In his book
How Rich Countries Got Rich ... and Why Poor Countries Stay Poor
' (2007), Reinert criticises liberal economists for ignoring empirical evidence when they promote free-trade as the solution to third world countries. He claims poor countries should, and should be allowed to, use protectionism to build up their own industries until they can compete internationally and that the state should be involved in this process.

Differences to and criticism of the mainstream economics

Much of The Others Canon's criticism of the mainstream economics regards the focus on equilibrium and the static, as well as what the neoclassical models takes as given (perfect information, perfect foresight, constant

returns to scale In economics, the concept of returns to scale arises in the context of a firm's production function. It explains the long-run linkage of increase in output (production) relative to associated increases in the inputs (factors of production). In th ...

and no diversity/likeness of economic activity). Conforming with Schumpeterian theory The Other Canon emphasises the constant change in the economy and that entrepreneurs and capitalists all the time create temporary monopolies based on advantages of knowledge and/or uncertain assumptions about the future. The fact that mainstream economics sees innovation and novelty, and hence growth (of which capitalism is absolutely dependent), as exogenous phenomena does not fall lightly with The Other Canon who sees these factors as pivotal to the economy and something that is maximised through stimulation in the form of state policy. The Other Canon claims reintroducing increasing and diminishing (decreasing) returns to scale can help us understand the economic development and why neo-classical economy has failed to explain the uneven development of nations. Reinerts claims poor country's concentrating their production on industries with diminishing returns to scale will lead them to become more inefficient the more they invest while the opposite thing will happen to the rich countries with their primarily increasing returns to scale industries. This, he argues, is why following

Ricardian Economics Ricardian economics are the economic theories of David Ricardo, an English political economist born in 1772 who made a fortune as a stockbroker and loan broker.Henderson 826Fusfeld 325 At the age of 27, he read '' An Inquiry into the Nature an ...

, mainly his theory of

comparative advantage Comparative advantage in an economic model is the advantage over others in producing a particular Goods (economics), good. A good can be produced at a lower relative opportunity cost or autarky price, i.e. at a lower relative marginal cost prior t ...

, will, instead of leading to the factor price equalisation neo-liberals profess, in fact usher poor countries into "specialising in being poor and inefficient".

Paul Krugman Paul Robin Krugman ( ; born February 28, 1953) is an American New Keynesian economics, New Keynesian economist who is the Distinguished Professor of Economics at the CUNY Graduate Center, Graduate Center of the City University of New York. He ...

, however, takes use of increasing returns to scale in his New Trade Theory to explain the success of the industrialised countries, but leaves out diminishing returns to scale explaining the misery of the

Third World The term Third World arose during the Cold War to define countries that remained non-aligned with either NATO or the Warsaw Pact. The United States, Canada, Taiwan, Japan, South Korea, the Southern Cone, NATO, Western European countries and oth ...

. The view of the economy as largely independent from society and the financial sector not being distinct from the real economy are also disputed by The Other Canon claiming that the economy is indeed embedded into society and that conflicts between the financial sector are normal and hence must be regulated.

Publishing

Since 2009, The Other Canon has its own book publishing series with Anthem Press in London, called TAOCS - The Anthem Other Canon Series. So far, publications include *a new biography of

Joseph Alois Schumpeter Joseph Alois Schumpeter (; February 8, 1883 – January 8, 1950) was an Austrian political economist. He served briefly as Finance Minister of Austria in 1919. In 1932, he emigrated to the United States to become a professor at Harvard Univer ...

by Schumpeter Society chairman

Esben Sloth Andersen Esben Sloth Andersen is an emeritus professor in economics at Aalborg University. Esben Sloth Andersen's research revolves around evolutionary economics with emphasis on innovation and its role in economic growth. Furthermore, he has worked with c ...

Festschrift In academia, a ''Festschrift'' (; plural, ''Festschriften'' ) is a book honoring a respected person, especially an academic, and presented during their lifetime. It generally takes the form of an edited volume, containing contributions from the h ...

for

, on ''Techno-Economic Paradigms'', edited by

and others *a re-edition of the complete English works of

Ragnar Nurkse Ragnar Wilhelm Nurkse (5 October 1907, Käru, Estonia – 6 May 1959, Le Mont-Pèlerin, Switzerland) was an Estonian-American economist and policy maker mainly in the fields of international finance and economic development. He is considered th ...

and a volume on Nurkse edited by Rainer Kattel and others *a new edition of

Bengt-Åke Lundvall Bengt-Åke Lundvall (born 1941, Sweden) is an emeritus professor in economics at the Department of Business and Management at Aalborg University. Biography Lundvall obtained his MA in economics at the University of Gothenburg in 1967. * Lundv ...

's work on National Innovation Systems and others.

References

External links

Official home page

Working papers of ''The Other Canon Foundation'' and the ''Tallinn University of Technology''.
{{DEFAULTSORT:Other Canon Foundation Economic research institutes Schools of economic thought