The Intrinsic Limits of Modern Economic Theory: The Emperor Has No Clothes
Assumptions of the uniqueness and stability of general equilibrium in a Walrasian framework have no theoretical justification. This paper argues that the key reason for this is that the Walrasian model treats people as acting independently of one another, especially in their demand behavior. This independence plays an essential role in constructing economies with arbitrary excess demand functions. Thus, making individual behavior dependent or similar may open the way to obtaining meaningful restrictions on aggregate excess demand functions. Copyright 1989 by Royal Economic Society.
Volume (Year): 99 (1989)
Issue (Month): 395 (Supplement)
|Contact details of provider:|| Postal: 2 Dean Trench Street, Westminster, SW1P 3HE|
Phone: +44 20 3137 6301
Web page: http://www.res.org.uk/
More information through EDIRC
|Order Information:||Web: http://www.blackwellpublishers.co.uk/asp/journal.asp?ref=0013-0133|
When requesting a correction, please mention this item's handle: RePEc:ecj:econjl:v:99:y:1989:i:395:p:126-39. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.