William D. Ferguson

William D. Ferguson
Grinnell College · Department of Economics

Ph.D., Economics

About

45
Publications
2,363
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78
Citations
Introduction
William D. Ferguson is the Gertrude B. Austin Professor of Economics, Grinnell College, Iowa, USA. Recent work focuses on institutional political economy game-theoretic approach. His second book is The Political Economy of Collective Action, Inequality and Development, Stanford University Press 2020 follows his 2013 (SUP) book, Collective Action and Exchange: A Game-Theoretic Approach to Contemporary Political Economy. Earlier work concerned implicit bargaining power in labor markets.

Publications

Publications (45)
Article
Full-text available
Undergraduate economics lags behind cutting-edge economic theory. The author briefly reviews six related advances that profoundly extend and deepen economic analysis: game-theoretic modeling, collective-action problems, information economics and contracting, social preference theory, conceptualizing rationality, and institutional theory. He offers...
Book
Full-text available
Collective Action and Exchange: A Game-Theoretic Approach to Contemporary Political Economy, William D. Ferguson, Stanford University Press, 2013 This book asserts that successful economic development relies on innumerable exchanges whose presence requires resolution of collective-action problems (CAPs). CAPs, sometimes called social dilemmas, ari...
Chapter
In the past, political settlements analysis (PSA) has suffered from a lack of conceptual clarity. In this chapter we provide an extended conceptual discussion, ultimately defining a political settlement as an ongoing agreement among a society’s most powerful groups over a set of political and economic institutions expected to generate for them a mi...
Chapter
This chapter provides an extended illustration of the authors’ new approach by applying it to South Africa, a country that, since 1960, has experienced all four types of settlement. The emphasis is on showing how empirical developments in that country are reflected in the country codings, and also how the concepts provide a helpful language for exp...
Chapter
This chapter takes a further step towards enhancing political settlement analysis’s formal rigour. It offers a framework that permits systematic inquiry into relationships between distributions of power, institutional evolution, and prospects for resolving a series of context-specific collective-action problems that often hinder inclusive developme...
Chapter
Few concepts have captured the imagination of the conflict and development community in recent years as powerfully as the idea of a ‘political settlement’. At its most ambitious, ‘political settlements analysis’ (PSA) promises to explain why conflicts occur and states collapse, the conditions for their successful rehabilitation, different developme...
Book
Full-text available
Few concepts have captured the imagination of the conflict and development communities in recent years as powerfully as the idea of a ‘political settlement’. At its most ambitious, ‘political settlements analysis’ (PSA) promises to explain why conflicts occur and states collapse, the conditions for their successful rehabilitation, different develop...
Chapter
This chapter concludes, summarizing the argument, the main findings, and considering the implications. The advice given should be treated as a set of ‘first bets’, or ‘compass bearings’ for policymakers, especially development partners, who are seeking to advance the cause of inclusive development. The findings might also be of interest for other i...
Chapter
This chapter shows how the approach can be used to analyse the comparative politics of development. Specifically, four countries are selected that over the past two decades provide good representations of the different quadrants of the authors’ typology, and the links between their typological variables and economic and social development are trace...
Chapter
This chapter bolsters the external validity of the authors’ findings by subjecting them to large- N analysis, using the 2,718 country-years in their forty-two-country dataset, helping to address some of the challenges to PSA outlined in Chapter 1, and placing political settlements analysis more squarely within the social scientific mainstream. Afte...
Chapter
Chapter 4 moves to measurement and testing. A lack of clear guidelines for measurement has bedevilled political settlements analysis (PSA) and limited its acceptance by the social scientific mainstream. Here, the authors discuss how to identify evolutions or changes in political settlements, how to measure and code in a rigorous way some of their k...
Presentation
Full-text available
This paper develops applies a typology of political settlements (mutual understandings held among powerful parties to resolve disputes via politics rather than organized violence). It offers a conceptual lens for analyzing how contours of social context influence developmental prospects by shaping underlying collective-action problems that often im...
Data
Brian Levy's Review of Political Economy of Collective Action, Inequality, and Development
Presentation
Full-text available
Faced with the Covid-19 pandemic, societies must simultaneously address disease transmission and treatment, the loss of production and income, rising poverty, and increasing inequality—and they must often do so in political environments conditioned by declining trust in leadership and institutions. This talk will use the concept of collective-actio...
Data
David Booth's review for the Journal of Development Studies of my 2020 Stanford University Press book, The Political Economy of Collective Action, Inequality, and Development.
Presentation
Full-text available
This talk focuses on Chapter 8 of my new book, The Political Economy of Collective Action, Inequality, and Development (Stanford Univ. Press, 2020). Political settlements underlie institutional construction and thus a society’s prospects for development. Without some mutually understood method for settling major disputes though politics rather than...
Book
Full-text available
This book examines how a society that is trapped in stagnation might initiate and sustain economic and political development. In this context, progress requires the reform of existing arrangements, along with the complementary evolution of informal institutions. It involves enhancing state capacity, balancing broad avenues for political input, and...
Article
Full-text available
This paper presents a theoretical argument focused on how social norms and formal institutions operate as cognitive coping mechanisms among groupings of boundedly rational actors who face fundamental uncertainty concerning their political and economic environments. Broadly speaking, informal and formal institutions facilitate strategic decision mak...
Research
Social networks underlie social capital; they are the grid upon or through which all manners of social, economic, and political exchanges occur. We may even think of institutions as networks of information flows and shared understandings, or as complex conduits of cognition, information, and motivation. Networks thus constitute the social foundatio...
Article
Full-text available
Radical reform displaces social equilibria. It reorients key institutions and underlying mechanisms of coordination and enforcement. This paper presents a broad framework for analyzing radical reform in terms of a large set of collective-action problems faced by potential reformers. It merges concepts that often appear separately in the literature,...
Presentation
Full-text available
Radical reform displaces social equilibria. It reorients key institutions and underlying mechanisms of coordination and enforcement. This paper presents a broad framework for analyzing radical reform in terms of a large set of collective-action problems faced by potential reformers. It merges concepts that often appear separately in the literature,...
Conference Paper
This paper uses game-theoretic reasoning to formalize a concept of power and relate power to exchange and other economic activity. With reference to the literature, the paper offers a precise definition of power, followed by discussion of basic sources of power-access to resources, institutionally designated positions, and an ability to resolve org...
Data
Full-text available
2015 Stanford U Press Flyer on the book.
Conference Paper
Full-text available
This paper presents a theoretical argument focused on how social norms and formal institutions operate as cognitive coping mechanisms among groupings of boundedly rational actors who face fundamental uncertainty concerning their political and economic environments. Broadly speaking, informal and formal institutions facilitate strategic decision mak...
Article
Full-text available
We provide a theoretical foundation for analyzing how social stigma and adopted behavioral traits affect the transmission of HIV across a population. We combine an evolutionary game-theoretic model—based on a relationship signaling stage game—with the SIR (susceptible-infected-recovered) model of disease transmission. Our evolutionary model specifi...
Article
Full-text available
Game theory offers a rigorous set of concepts, relationships, and models that invite myriad applications to problems of political economy. Indeed, game theory can serve as a fundamental modeling technique that can bridge microfoundations of political and economic exchanges, with developmental processes and macro implications related to growth and d...
Data
Endorsements for Collective Action and Exchange: A Game-Theoretic Approach to Contemporary Political Economy
Conference Paper
Full-text available
This paper develops a bounded-rationality model of Minsky's financial instability hypothesis along with related ideas from Keynes and others. It proceeds to link financial instability to game-theoretic representations of collective-action problems. Minsky argues that three types of finance regimes can exist in an economy: 1) hedge finance, whereby...
Article
Undergraduate economics lags behind cutting-edge economic theory. This paper briefly reviews seven related advances: game theory modeling, information economics, social preference, conceptualizing rationality, contracting/enforcement, collective-action problems, and social mechanisms/institutions. These developments profoundly extend and deepen eco...
Article
Full-text available
This paper addresses implicit bargaining power within employment relationships using a versatile model of labor market segmentation that combines labor discipline, performance pay, insider power, and fair wage principles. In the primary sector, fair wage comparisons, firm-specific human capital, and less perfect monitoring engender bilateral bargai...
Article
Full-text available
This paper develops a widely applicable model of bilateral market power in employment relationships along with some of its implications. The model combines concepts from two strands of the efficiency wage literature—labor discipline and labor turnover models—with concepts from insider power models. It indicates that systematic differences in the co...
Article
Full-text available
This paper investigates bilateral market power in labor markets by merging an effort or labor discipline model with a turnover cost model. The effort model indicates unilateral employer power over workers; adding costly turnover allows for bilateral power in employment relationships. Systematic differences in exogenous determinates of the cost of j...
Article
Full-text available
This paper investigates causes of the dramatic increase in the wage-productivity gap - the divergence between the growth rates of aggregate productivity and real wages - in the post-1981 period. Using a two-step estimation procedure which incorporates three-digit industry wage regression coefficients into an aggregate wage growth identity equation,...
Article
Full-text available
This paper merges a cost-based model of union bargaining power, in which bargaining power reflects relative costs of agreement and disagreement facing unions and management, with an efficiency-wage model, in which effort per hour responds positively to the real wage. Union bargaining alters the effort/wage relationship to increase the wage for a gi...
Article
Full-text available
Economic events of the 1980s reveal declining real wages for non-supervisory workers in goods sector industries accompanied by lesser declines in service sector industries. A simple two-sector effort-regulation model—which assumes that the cost of job loss responds to labor’s bargaining power and which acknowledges influences of institutional chang...

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Projects

Projects (3)
Project
My recent book (Stanford University Press) develops a conceptual framework that relates specific political-economic contexts--notably power relations and institutional configurations--to specific sets of collective-action problems that often interfere with economic and political development. It merges several developmental hypotheses and constructs several typologies of social orders and political settlements. This approach offers a platform for a platform for policy analysis, more specific models, and multiple hypotheses.
Archived project
Develop a set of models that illustrate determinates of implicit bargaining power in employment relationships. Implicit bargaining power exists independently of formal organization (e.g., unions); it emerges from underlying employment conditions and affects the distribution of labor income.
Project
This book and related papers endeavor to bring the political economy of collective action to the forefront of economic and social scientific debates, curriculum, and policy analysis. The book merges recent developments in political economy that rarely appear together. Its discussion combines rational-actor theory, information economics, behavioral economics, institutional theory, and social network theory. It incorporates concepts of moral hazard, social preference, social norms, formal institutions, bounded rationality, policy process, and power. Using these concepts, it asserts that resolving the nexus of CAPs that underlie complex exchange requires both motivation and shared understandings; these arise from mixtures of reciprocal behavior, social norms, and formal rules. Moreover, processes of resolving CAPs inextricably link power, distribution, and growth. To illustrate these points, this book employs a game-theoretic methodology that can represent interactions ranging from two-person exchanges to crowd behavior, or exchanges among nations.