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Philosophy of Economic Theory

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Philosophy of Economic Theory

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Contact information: MelanieSwan.com/contact.html.


Philosophy of Economic Theory (DRAFT 12/19/17) download as PDF

PHIL 3xx

Fall 2019 (Semester dates: Mon Aug 19 – Sat Dec 7)

Purdue University


Course Instructor: Melanie Swan 

Office: REC 411 

Office Hours: TTh, 2:00pm-3:30pm, and by appointment


Course Time and Location

TTh 12:00-1:15pm, [BRNG 1248]


Description of Course

The philosophy of economic theory investigates how the notions of economic systems and concepts (such as money, debt, and credit) have changed over time. Economics is concerned with the production, distribution, and consumption of goods and services, and how individuals and groups make choices about these goods and services. In economics, the general form of the problem is that wants are bigger than resources, and thus action-taking requires a means of making decisions. Even if two choices are free, there are consequences and opportunity costs of deploying resources in one area and not the other. This course traces the structure of decision-making in a progression of economic domains, from classical discussions of economic theory to modern discussions to contemporary digital network discussions. No prerequisites.


Texts (readings from these texts and as noted, provided on Blackboard)

Hausman, Daniel, Ed. 2007. The Philosophy of Economics: An Anthology. Cambridge UK: Cambridge University Press. ISBN 978-0521709842.

McAfee, Andrew and Erik Brynjolfsson. 2017. Machine, Platform, Crowd: Harnessing Our Digital Future. London UK: W.W. Norton & Co. ISBN 978-0393254297.


Course Requirements

1.  Weekly written questions. (20%). Each Tuesday, before the start of class, you are required to email or hand in a printed copy of three questions regarding the texts for the week (one page max, shorter preferred).

2.  One presentation (30%): You will be expected to give one short presentation (5-10 min max) in front of the class concerning a topic of your choice related to the class, made in consultation with instructor.

3. Two papers (50%). You are required to write two short papers (each paper 8 pages max, double-spaced, 12-point font) on any topic of your choice pertaining to the class material.


Tentative Course Outline

This is a tentative schedule of topics and readings, which may be altered during the course of the semester.



Week 1:

Aug 20: Introduction to Economic Theory

Reading: None


Aug 22: Historical Theories of Economics

Reading: Davies, Glyn. 2002. A History of Money: From Ancient Times to the Present Day. Univ of Wales Press. From Primitive Money to the Invention of Coinage: 34-65.

Week 2:

Aug 27: Contemporary Theories of Money

Reading: Orrell, David. 2016. A Quantum Theory of Money and Value. Economic Thought. 5(2): 19-28.


Aug 29: Ancient Greece: Mind and Money

Reading: Seaford, Richard. 2004. Money and the Early Greek Mind: Homer, Philosophy, Tragedy. Cambridge University Press: 1-22.



Week 3:

Sep 3: Political Economy

Reading: Mill, John Stuart. On the Definition and Method of Political Economy. (Hausman Ch 1: 41-58).


Sep 5: The Labor Economy

Reading: Marx, Karl. Selected Texts on Economics, History, and Social Science (Hausman Ch 5: 108-128).

Week 4:

Sep 10: Cost of Capital, Interest Rates, Usury

Reading: Homer, Sidney and Richard Sylla. 2005. A History of Interest Rates. Wiley. 4th Ed. Ch 6: Usury Doctrines & effect on European Credit Forms and Interest: 67-79.


Sep 12: Creative Destruction and Technology Innovation

Reading: Schumpeter, Joseph. Science and Ideology. (Hausman Ch 11: 207-221).

Week 5:

Sep 17: Competitive Advantage

Reading: Ruffin, Roy J. 2002. David Ricardo’s Discovery of Comparative Advantage. History of Political Economy. 34(4): 727-748.




Sep 19: Modern Philosophy of Economics

Reading: Friedman, Milton. The Methodology of Positive Economics (Hausman Ch 7: 145-178).

Week 6:

Sep 24: Competitive Currencies

Reading: Hayek, Friedrich. 1976. The Denationalization of Money: The Argument Refined. London: Institute of Economic Affairs. Ch 9: Competition between Banks Issuing Different Currencies: 51-68.


Sep 26: The Right Size of the Firm

Reading: Coase, R.H. 1937. The Nature of the Firm: 1-17.

Week 7:

Oct 1: Trade and Innovation have similar Economic Effects

Reading: World Economic Forum. 2015. Trade and Innovation.


Oct 3: NO CLASS (Paper #1 due via email to instructor by 6 pm)

Week 8:

Oct 8: NO CLASS (October Break)




Oct 10: How Wealth is Created

Reading: Beinhocker, Eric D. 2006. Origin of Wealth: Evolution, Complexity, and the Radical Remaking of Economics. Ch 1: How is Wealth Created:  3-20.

Week 9:

Oct 15: Economy as Morin’s General Complexity

Readings: Human, Oliver, and Paul Cilliers. 2013. Towards an Economy of Complexity: Derrida, Morin and Bataille. Theory, Culture & Society. 30(5):24-44.

Morin, Edgar. 2005. “Restricted Complexity, General Complexity.”


Oct 17: Excess not Scarcity

Reading: Bataille, Georges. 1991. The Accursed Share: an Essay on General Economy, Vol. 1: Consumption. New York: Zone Books.



Week 10: 

Oct 22: Structure and Theory of Debt

Reading: Wagner, Richard E. Debt, Money, and Public Finance. In Handbook of Public Finance. Eds. Jürgen G. Backhaus & Richard E Wagner: 195-215.


Oct 24: Income Distribution

Reading: Piketty, Thomas. 2014. Capital in the Twenty-First Century. Cambridge MA: Belknap Press. Income and Output Ch 1: 39-71.

Week 11: 

Oct 29: Income Inequality

Reading: Wilkinson, Richard and Kate Pickett. 2011. The Spirit Level: Why Greater Equality Makes Societies Stronger. Bloomsbury Press. The Costs of Inequality: 197-216.


Oct 31: Enabling Human Capability as an Economic Goal

Reading: Sen, Amartya. Capability and Well-Being (Hausman Ch 15: 270-294).



Week 12:

Nov 5: Two-way Network Effects

Reading: McAfee & Brynjolfsson. Machine, Platform, Crowd. Triple Revolution: 1-30.


Nov 7: Network Theory

Reading: Jackson, Matthew O. 2008. Social and Economic Networks. Princeton University Press. Ch 1: Introduction: Model Networks: 17-38.

Week 13:

Nov 12: Accounting Theory

Reading: Gaffikin, Michael J. R. 2016. A Brief Historical Appreciation of Accounting Theory? In Pioneers of Critical Accounting A Celebration of the Life of Tony Lowe. Eds. Jim Haslam & Prem Sikka. London: Palgrave Macmillan: 109-142.


Nov 14: Triple-Entry Bookkeeping

Reading: Ijiri, Yuji. 1986. A Framework for Triple-Entry Bookkeeping. The Accounting Review. Vol. LXI(4): 745-59.

Week 14:

Nov 19: Game Theory

Reading: Argoneto et al. 2008. Game Theory: an Overview. In Production Planning in Production Networks. Springer: 13-24.


Nov 21: Bitcoin: Solving Digital Currency’s Double-spending Problem

Reading: Nakamoto, Satoshi. 2008. Bitcoin: A Peer-to-Peer Electronic Cash System.


Week 15:

Nov 26: Digital Currencies

Reading: Tasca, Paolo. 2015. Digital Currencies: Principles, Trends, Opportunities, and Risks. Bundesbank and ECUREX Technical Report.


Nov 28: NO CLASS (Thanksgiving Break, Nov 27-30)

Week 16:

Dec 3: Course Summary

Reading: None

Dec 5: NO CLASS (Paper #2 due via email to instructor by 6 pm)


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