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Classical Economists, Marx and Marshall on Dominant Technique

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  • Persefoni Tsaliki
  • Lefteris Tsoulfidis

Abstract

The focal point of this paper is the notion of the dominant technique and its treatment in the theories of value and distribution. Our argument is that neither the average nor the minimum cost production are necessarily identified with the dominant technique in an industry. The dominant technique is in fact approximated with the types of capital, where expansion or contraction of accumulation actually takes place, and in this sense, the dominant is perceived as marginal technique used by firms entering (or leaving), and, therefore, expanding (or contracting) industry’s supply. Such a concept is absolutely consistent with the classical theory of value and is at odds with the neoclassical (not necessarily Marshall’s) theory despite of the adoption of marginal analysis.

Suggested Citation

  • Persefoni Tsaliki & Lefteris Tsoulfidis, 2015. "Classical Economists, Marx and Marshall on Dominant Technique," HISTORY OF ECONOMIC THOUGHT AND POLICY, FrancoAngeli Editore, vol. 2015(2), pages 21-36.
  • Handle: RePEc:fan:spespe:v:html10.3280/spe2015-002002
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    References listed on IDEAS

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    1. Tsoulfidis, Lefteris & Tsaliki, Persefoni, 2011. "Classical competition and regulating capital: theory and empirical evidence," MPRA Paper 51334, University Library of Munich, Germany, revised 2013.
    2. Prendergast, Renee, 1992. "Increasing Returns and Competitive Equilibrium--The Content and Development of Marshall's Theory," Cambridge Journal of Economics, Oxford University Press, vol. 16(4), pages 447-462, December.
    3. Shaikh, Anwar, 2016. "Capitalism: Competition, Conflict, Crises," OUP Catalogue, Oxford University Press, number 9780199390632.
    4. Schohl, Frank, 1999. "The Paradoxical Fate of the Representative Firm," Journal of the History of Economic Thought, Cambridge University Press, vol. 21(01), pages 65-80, March.
    5. Garegnani, Pierangelo, 1983. "The Classical Theory of Wages and the Role of Demand Schedules in the Determination of Relative Prices," American Economic Review, American Economic Association, vol. 73(2), pages 309-313, May.
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    More about this item

    JEL classification:

    • B10 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - General
    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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