David Ellerman's Home Page:

Selected Current and Past Writings in

Political Economy, Legal Theory, Philosophy, and Mathematics

Overview

The purpose of this website is to present for comment and discussion a selection of my published and draft papers and essays on topics in political economy (including economics) and legal theory, philosophy, and mathematics. Most of the writings in political economy and legal theory are related to:

Some of the papers discuss the particular institutional problems of the economic transition in the post-socialist countries--and more general questions of economic development.

Papers in Political Economy and Legal Theory

The Human-Capital-ist Firm: An Approach from Property Theory and Democratic Theory.
"Economic" theories of the firm base the design of firms on cost minimization. Yet the scope of cost minimization is restricted to a constraint set of "permitted" institutional forms which would rule out certain possibilities such as the voluntary sale of human capital (the self-sale contract). This paper presents an array of rights-based arguments that the constraint set should be further restricted to exclude the self-rental or employment contract. The rights arguments come from two general sources: the standard principle of responsibility in jurisprudence ("Assign legal responsibility in accordance with de facto responsibility") and democratic theory ("People should be democratically self-determining in all spheres of human life--not just the 'public' sphere"). These theories descend from the Reformation and Enlightenment, and the theories include an inalienable rights argument to defeat voluntary contractual violations of the principles such as the self-sale contract and the Hobbesian pact of subjugation. The key intuition of the inalienable rights theory is that one cannot in fact voluntarily "transfer" responsibility for one's actions to another person (i.e., can only voluntarily co-operate with another person) and cannot voluntarily "transfer" decision-making to another (i.e., can only voluntarily make one's decision in accordance with the decision of another). Yet this old critique of the self-sale contract and Hobbesian pact also applies to the short-term self-rental contract and the Hobbesian pact in the workplace, the employment contract. If the constraint set is reduced by eliminating the employment contract then the range of feasible designs for the firm would all involve labor hiring capital with the human capitalists being the residual claimants, i.e., they would all be various forms of the human-capital-ist firm.

Insider Sovereignty and Corporate Governance in the Japanese Company.
This paper presents the developing theory of the large Japanese company (J-firm) as essentially a labor-managed firm. Throughout the contrast is drawn between the J-firm and the "standard model" of the shareholder-oriented "Anglo-American" joint stock company (AA-firm). Both models are presented in a simplified and idealized form in order to sharpen and clarify the contrast.

Papers in Philosophy

The Kantian Personality Principle in Political Economy.
Ethical theories can be broadly grouped into utilitarian theories and rights-based theories. Modern economics is so thoroughly utilitarian that most economists would be hard-pressed to cite the application of a rights-based argument to economic institutions. Yet the normative principles embodied the labor theory of property and the de facto theory of inalienability are squarely within the rights-based tradition. The democratic principle of self-determination is also a closely allied rights-based theory. Immanual Kant occupied the pinnacle of the philosophical tradition of rights-based theorists. His categorical imperative, particularly in the form of the "personality principle" always to treat human beings as persons rather than as things, seems to be quite fruitful when coupled with institutional analysis of property rights and governance rights. The purpose of this essay is to show how the labor theory of property, the de facto theory of inalienability, and the democratic principle coherently fit into a Kantian framework (in the sense of the personality principle).

Papers in Mathematics

Parallel Addition, Series-Parallel Duality, and Financial Mathematics.

This essay develops the notion of parallel addition that is dual to ordinary (series) addition. These operations are represented by the parallel or series addition of resistors in electrical circuits. A number of applications of series-parallel duality are developed outside of electrical circuit theory. The most interesting new application is financial arithmetic where each equation has a dual equation. Series-parallel duality is shown to be related to convex duality as a derivative of a function is related to the original function.

Books

Property and Contract in Economics: The Case for Economic Democracy.
This book re-examines the basic principles of private property and contract to obtain results at odds with the employer-employee relation in favor of universal self-employment or economic democracy. Joint self-employment in the firm is the economic version of joint self-determination or political democracy in the society. Private property should be based on people getting the (net) fruits of their labor, but that only happens under joint self-employment. Market contracts should only apply to what can in fact be transferred, but a person's labor in not really transferable (as we easily recognize for hired criminals). This book traces these ideas�the labor theory of property and the notion of inalienable rights�from the ancient Stoics through the Reformation and Enlightenment, and restates the ideas in modern terms with critical applications to economic theory.

Intellectual Trespassing as a Way of Life: Essays in Philosophy, Economics, and Mathematics.

Dramatic changes or revolutions in a field of science are often made by outsiders or "trespassers" who are not beholden to the established habits of thought in the field. Each essay in this diverse collection shows the fruits of intellectual trespassing and poaching between fields such as theory of property, Kantian ethics, history of slavery thought, marginal productivity theory, double-entry bookkeeping, philosophy of mind and machines, category theory, concrete universals, proportional representation, arbitrage, algebraic logic, and series-parallel duality in finance.