IDEAS home Printed from https://ideas.repec.org/a/wly/soecon/v64y1997i2p517-530.html
   My bibliography  Save this article

Scissors or Horizon: Neoclassical Debates about Returns to Scale, Costs, and Long‐Run Supply, 1926‐1942

Author

Listed:
  • Nahid Aslanbeigui
  • Michele I. Naples

Abstract

Modern treatment of long‐run (U‐shaped) cost curves developed from reactions to Sraffa's criticisms of Marshall. He argued that internal (dis)economies were incompatible with partial‐equilibrium analysis under perfect competition. Pigou concurred and drew L‐shaped cost curves; Viner realized that this made firm size indeterminate and industry output volatile. Using Austin and Joan Robinson's analyses, Stigler justified rising costs/supply, determinacy, and stability by irrational entrepreneurs enduring coordination failure and by factor price changes. We conclude that consistency requires constant costs but firm employment, output, and factor incomes remain theoretically indeterminate. It becomes likely that large firms will undermine perfect competition.

Suggested Citation

  • Nahid Aslanbeigui & Michele I. Naples, 1997. "Scissors or Horizon: Neoclassical Debates about Returns to Scale, Costs, and Long‐Run Supply, 1926‐1942," Southern Economic Journal, John Wiley & Sons, vol. 64(2), pages 517-530, October.
    • Handle: RePEc:wly:soecon:v:64:y:1997:i:2:p:517-530
    DOI: 10.1002/j.2325-8012.1997.tb00070.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/j.2325-8012.1997.tb00070.x
    Download Restriction: no
    File URL: https://libkey.io/10.1002/j.2325-8012.1997.tb00070.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Frederic S. Lee, 1984. "The Marginalist Controversy and the Demise of Full Cost Pricing," Journal of Economic Issues, Taylor & Francis Journals, vol. 18(4), pages 1107-1132, December.
    2. Shackle,G. L. S., 1983. "The Years of High Theory," Cambridge Books, Cambridge University Press, number 9780521274784.
    3. Moss, Scott, 1984. "The History of the Theory of the Firm from Marshall to Robinson and Chamberlin: The," Economica, London School of Economics and Political Science, vol. 51(23), pages 307-318, August.
    4. Wesley J. Yordon, 1992. "Stigler's Adaptable and Indivisible Plant and the Micro/Macro Schism," History of Political Economy, Duke University Press, vol. 24(2), pages 455-470, Summer.
    5. Sardoni, Claudio, 1994. "The General Theory and the Critique of Decreasing Returns," Journal of the History of Economic Thought, Cambridge University Press, vol. 16(1), pages 61-85, April.
    6. Marcuzzo, Maria Cristina, 1994. "R. F. Kahn and Imperfect Competition," Cambridge Journal of Economics, Oxford University Press, vol. 18(1), pages 25-39, February.
    7. Allyn A. Young, 1913. "Pigou's Wealth and Welfare," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 27(4), pages 672-686.
    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. Claudio Sardoni, 2011. "Unemployment, Recession and Effective Demand," Books, Edward Elgar Publishing, number 13837.
    2. Mehrdad Vahabi, 1998. "The Relevance of the Marshallian Concept of Normality in Interior and in Inertial Dynamics as Revisited by G. SHACKLE and J. KORNAI," Post-Print hal-00629181, HAL.
    3. Arena, Richard, 1992. "Une synthèse entre post-keynésiens et néo-ricardiens est-elle encore possible?," L'Actualité Economique, Société Canadienne de Science Economique, vol. 68(4), pages 587-606, décembre.
    4. Tae-Hee Jo, 2021. "A Veblenian Critique of Nelson and Winter’s Evolutionary Theory," Journal of Economic Issues, Taylor & Francis Journals, vol. 55(4), pages 1101-1117, October.
    5. Keuzenkamp, H.A., 1989. "The prehistory of rational expectations," Other publications TiSEM 2dbf33bd-00ce-4b2e-baa5-3, Tilburg University, School of Economics and Management.
    6. Timoteo Carletti & Simone Righi & Duccio Fanelli, 2011. "Emerging Structures In Social Networks Guided By Opinions' Exchanges," Advances in Complex Systems (ACS), World Scientific Publishing Co. Pte. Ltd., vol. 14(01), pages 13-30.
    7. Daniele Besomi, 1997. "Roy Harrod and traditional theory," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 4(1), pages 92-115.
    8. Roger J. Sandilands, 2009. "Solovian and New Growth Theory from the Perspective of Allyn Young on Macroeconomic Increasing Returns," History of Political Economy, Duke University Press, vol. 41(5), pages 285-303, Supplemen.
    9. Keuzenkamp, H.A., 1989. "The prehistory of rational expectations," Discussion Paper 1989-31, Tilburg University, Center for Economic Research.
    10. Carlo Cristiano, 2010. "Marshall at Cambridge," Chapters, in: Tiziano Raffaelli & Giacomo Becattini & Katia Caldari & Marco Dardi (ed.), The Impact of Alfred Marshall’s Ideas, chapter 3, Edward Elgar Publishing.
    11. Alex Coad & Werner Hölzl, 2012. "Firm Growth: Empirical Analysis," Chapters, in: Michael Dietrich & Jackie Krafft (ed.), Handbook on the Economics and Theory of the Firm, chapter 24, Edward Elgar Publishing.
    12. Ferlito, Carmelo, 2013. "Bruno Leoni and the Socialist Economic Calculation Debate," MPRA Paper 67745, University Library of Munich, Germany.
    13. Ramesh Chandra, 2006. "Currie's 'leading sector' strategy of growth: an appraisal," Journal of Development Studies, Taylor & Francis Journals, vol. 42(3), pages 490-508.
    14. Denis Claude & Mabel Tidball, 2022. "Taking firms’ margin targets seriously in a model of competition in supply functions," CEE-M Working Papers hal-03548797, CEE-M, Universtiy of Montpellier, CNRS, INRA, Montpellier SupAgro.
    15. Nicolai J. Foss & Giampaolo Garzarelli, 2007. "Institutions as knowledge capital: Ludwig M. Lachmann's interpretative institutionalism," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 31(5), pages 789-804, September.
    16. František Slanina & Zdeněk Konopásek, 2010. "Eigenvector Localization As A Tool To Study Small Communities In Online Social Networks," Advances in Complex Systems (ACS), World Scientific Publishing Co. Pte. Ltd., vol. 13(06), pages 699-723.
    17. Franck Bailly, 2022. "When mainstream economics does human resource management: a critique of personnel economics’ prescriptive ambition," Post-Print hal-03711945, HAL.
    18. Brian Loasby, 2002. "Content and method: an epistemic perspective on some historical episodes," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 9(1), pages 72-95.
    19. M. June Flanders, 2015. "It's Not a Minsky Moment, It's a Minsky Era, Or: Inevitable Instability," Econ Journal Watch, Econ Journal Watch, vol. 12(1), pages 84-105, January.
    20. Maria Cristina Marcuzzo, 2003. "Joan Robinson and the three cambridge revolutions," Review of Political Economy, Taylor & Francis Journals, vol. 15(4), pages 545-560.

    More about this item

    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:wly:soecon:v:64:y:1997:i:2:p:517-530. 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: Wiley Content Delivery (email available below). General contact details of provider: https://doi.org/10.1002/(ISSN)2325-8012 .

    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.