[go: up one dir, main page]
More Web Proxy on the site http://driver.im/
IDEAS home Printed from https://ideas.repec.org/p/mil/wpdepa/2009-47.html
   My bibliography  Save this paper

Edgeworth vs. Walras on equilibrium and disequilibrium

Author

Listed:
  • Franco DONZELLI
Abstract
In a brief review of the second edition of Walras’s Eléments, published in 1889, Edgeworth criticizes Walras’s theory of tâtonnement, viewed as a misplaced and misleading attempt at explaining the equilibration process in a multi-market economy. Edgeworth’s attack sets off a controversy, raging over the 1889-1891 period, and then smouldering over the entire lives of both economists. The chief aim of this paper is to analyze the joint evolution of Edgeworth’s and Walras’s ideas on equilibrium and equilibration from the 1889-1891 controversy onwards. Even if Edgeworth’s original critique concerns Walras’s tâtonnement only, it will be proved that the fundamental divide between the two authors involves not only the dynamic, but also the static part of their respective theoretical systems. The Edgeworth-Walras controversy will be shown to produce major effects on both Walras and Edgeworth: both of them will partially revise their ideas on statics and dynamics; further, either one will take in some hints originating from the other. Yet, in spite of their reciprocal influences, their mutual communication will turn out to be quite limited. For Edgeworth will prove unable to understand the central, and unsolvable, problem of tâtonnement from Walras’s own standpoint: how to preserve a “realistic” and comprehensive picture of an observable disequilibrium process in “real” time, without disrupting the assumption of data invariance during the equilibration process. At the same time Walras will prove unable to grasp the essence of Edgeworth’s critique: that bargaining is more “fundamental” than price-taking behavior, so that the core is a broader solution concept than competitive equilibrium and recontracting a more general equilibration process than tâtonnement.

Suggested Citation

  • Franco DONZELLI, 2009. "Edgeworth vs. Walras on equilibrium and disequilibrium," Departmental Working Papers 2009-47, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    • Handle: RePEc:mil:wpdepa:2009-47
    as

    Download full text from publisher

    File URL: http://wp.demm.unimi.it/files/wp/2009/DEMM-2009_047wp.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Franco Donzelli, 2007. "Equilibrium and Tâtonnement in Walras's Eléments," History of Economic Ideas, Fabrizio Serra Editore, Pisa - Roma, vol. 15(3), pages 85-138.
    2. Whitaker,John K. (ed.), 1990. "Centenary Essays on Alfred Marshall," Cambridge Books, Cambridge University Press, number 9780521381338, September.
    3. Roberto Marchionatti, 2007. "On the application of mathematics to political economy'. The Edgeworth--Walras--Bortkievicz controversy, 1889--1891," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 31(2), pages 291-307, March.
    4. Walker, Donald A, 1973. "Edgeworth's Theory of Recontract," Economic Journal, Royal Economic Society, vol. 83(329), pages 138-149, March.
    5. Gerard Debreu, 1963. "On a Theorem of Scarf," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 30(3), pages 177-180.
    6. Nicholas Kaldor, 1934. "A Classificatory Note on the Determinateness of Equilibrium," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 1(2), pages 122-136.
    7. Creedy, John, 1979. "Edgeworth's Contribution to the Theory of Exchange," Scottish Journal of Political Economy, Scottish Economic Society, vol. 26(2), pages 163-181, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Franco DONZELLI, 2011. "The law of indifference, equilibrium, and equilibration in Jevons, Walras, Edgeworth, and Negishi," Departmental Working Papers 2011-11, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    2. Franco DONZELLI, 2011. "Negishi on Edgeworth on Jevons’s law of indifference, Walras’s equilibrium, and the role of large numbers: a critical assessment," Departmental Working Papers 2011-23, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    3. Franco DONZELLI, 2010. "Hicks on Walrasian equilibrium in the 1930s and beyond," Departmental Working Papers 2010-39, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    4. Juli Radev, 2011. "Static and dynamic market disequilibrium," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 2, pages 36-63.
    5. van der Laan, Gerard & Withagen, Cees, 2003. "Quasi-equilibrium in economies with infinite dimensional commodity spaces: a truncation approach," Journal of Economic Dynamics and Control, Elsevier, vol. 27(3), pages 423-444, January.
    6. Martin Shubik, 1984. "The Cooperative Form, the Value and the Allocation of Joint Costs and Benefits," Cowles Foundation Discussion Papers 706, Cowles Foundation for Research in Economics, Yale University.
    7. Parkash Chandler & Henry Tulkens & Jean-Pascal Ypersele & Stephane Willems, 2006. "The Kyoto Protocol: An Economic and Game Theoretic Interpretation," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 195-215, Springer.
    8. Fausto, Cavalli, 2016. "A cobweb model with alternating demand and supply functions," Working Papers 325, University of Milano-Bicocca, Department of Economics, revised 07 Feb 2016.
    9. Lester G. Telser, 1994. "The Usefulness of Core Theory in Economics," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 151-164, Spring.
    10. Wei He & Nicholas C. Yannelis, 2013. "A New Perspective on Rational Expectations," Economics Discussion Paper Series 1317, Economics, The University of Manchester.
    11. Konovalov, A., 1998. "Core Equivalence in Economies With Satiation," Other publications TiSEM bde29dd4-b328-48b4-8fb4-6, Tilburg University, School of Economics and Management.
    12. Élodie Bertrand, 2006. "La thèse d'efficience du « théorème de Coase ». Quelle critique de la microéconomie ?," Revue économique, Presses de Sciences-Po, vol. 57(5), pages 983-1007.
    13. Jean Gabszewicz & Giulio Codognato, 1991. "Équilibres de Cournot-Walras dans une économie d'échange," Revue Économique, Programme National Persée, vol. 42(6), pages 1013-1026.
    14. Aliprantis, Charalambos D. & Florenzano, Monique & Tourky, Rabee, 2005. "Linear and non-linear price decentralization," Journal of Economic Theory, Elsevier, vol. 121(1), pages 51-74, March.
    15. He, Wei & Yannelis, Nicholas C., 2015. "Equilibrium theory under ambiguity," Journal of Mathematical Economics, Elsevier, vol. 61(C), pages 86-95.
    16. Ichiishi, Tatsuro, 1985. "Management versus ownership, II," European Economic Review, Elsevier, vol. 27(2), pages 115-138, March.
    17. Sun, Ning & Trockel, Walter & Yang, Zaifu, 2008. "Competitive outcomes and endogenous coalition formation in an n-person game," Journal of Mathematical Economics, Elsevier, vol. 44(7-8), pages 853-860, July.
    18. Bhowmik, Anuj & Saha, Sandipan, 2022. "On blocking mechanisms in economies with club goods," MPRA Paper 114928, University Library of Munich, Germany.
    19. Nir Dagan, 1995. "Consistent Solutions in Exchange Economies: a Characterization of the Price Mechanism," Economic theory and game theory 011, Nir Dagan.
    20. Yusuke Kamishiro & Roberto Serrano & Myrna Wooders, 2021. "Monopolists of scarce information and small group effectiveness in large quasilinear economies," International Journal of Game Theory, Springer;Game Theory Society, vol. 50(4), pages 801-827, December.

    More about this item

    Keywords

    Edgeworth; Walras; equilibrium; disequilibrium; statics; dynamics;
    All these keywords.

    JEL classification:

    • B13 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Neoclassical through 1925 (Austrian, Marshallian, Walrasian, Wicksellian)
    • B16 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Quantitative and Mathematical
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mil:wpdepa:2009-47. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: DEMM Working Papers (email available below). General contact details of provider: https://edirc.repec.org/data/damilit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.