Walras’s law of markets as special case of the general Triangle Theorem: a laconic proof
From the set of the first three structural axioms follows the - economic - triangle theorem. It asserts that the product of the three key ratios, which characterize the firm, the market outcome, and the income distribution, is always equal to unity. The theorem contains only unit-free variables, is testable in principle, and involves no behavioral assumptions. The differentiated triangle theorem applies to an arbitrary number of firms. Therefrom Walras’s Law can be derived without recourse to demand and supply functions or the notion of equilibrium.
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- Kakarot-Handtke, Egmont, 2011. "The pure logic of value, profit, interest," MPRA Paper 30853, University Library of Munich, Germany.
- Egmont Kakarot-Handtke, 2012. "Primary and Secondary Markets," Economics Working Paper Archive wp_741, Levy Economics Institute.
- Kakarot-Handtke, Egmont, 2011. "Primary and secondary markets," MPRA Paper 32996, University Library of Munich, Germany.
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- Kakarot-Handtke, Egmont, 2013. "Confused confusers. How to stop thinking like an economist and start thinking like a scientist," MPRA Paper 44046, University Library of Munich, Germany.
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