Price and quantity adjustment in a dynamic closed model: The dual stability theorem

Filippini, Luigi

doi:10.1016/0164-0704(83)90091-5

Cited by 7 publications

(3 citation statements)

References 20 publications

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“…No analysis is possible of commodity prices since these prices depend on prices and outputs in other sectors,as well as on incomes distributed elsewhere -a rate of profit is a function of numerous other prices which cannot be assumed to be constant. (l) Egidi : 1975, Nikaido : 1977, Benetti : 1981, Carte lier : 1981, Steedman : 1982, Flaschel: 1983, Franke : 1983-, 1984, Filippini : 1983 This requirement is clearly violated by the famous Walrasian tatonnement. In the tatonnement process the aucti-0neer presents a vector of prices and agents respond by announcing what transactions they plan to perform.…”

Section: A Modez Of Corrrpetition Must Be Generalmentioning

confidence: 99%

The dynamics of competition: a restoration of the classical analysis

Duménil

Lévy

1987

Cambridge Journal of Economics

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Section: A Modez Of Corrrpetition Must Be Generalmentioning

confidence: 99%

The dynamics of competition: a restoration of the classical analysis

Duménil

Lévy

1987

Cambridge Journal of Economics

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“…Un certain nombre de modeles ont maintenant ete mis au point: Arena, Froeschle, Torre [1984], Boggio [1984Boggio [ ] et [1985, Catz, Laganier [1984], Filippini [1983, Flaschel, Semmler [1984], Franke [1985], Hosoda [1985], Krause [1984]. Plus precisement, on peut affirmer que leur comportement est determine par l'observation du desequilibre: ils sont informes des differences de profitabilite et reagissent a cette information.…”

Section: Un Modele Dynamique Classiqueunclassified

Équilibre de long terme, déséquilibre stationnaire et crise

Duménil¹,

Lévy²

1987

Revue économique

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“…Composite adjustment processes, built on both classical and Keynesian notions, have evinced the possibility of stability (see Fillipini, 1983;Boggio, 1990). The main intuition behind such stability is the weaker e¡ect of demand on prices and on pro¢tability.…”

Section: Introductionmentioning

confidence: 99%

Differential Profit Rates and Convergence to the Natural State

Gangopadhyay

1997

The Manchester School

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In establishing convergence to the``natural state'', we examine the allocation of capital by the``captains of industry'' who respond to pro¢t-rate di¡erentials. Such allocations unleash the equilibration forces of competition. It is constructively shown that the problem of capital allocation engenders a self-referential system whereby the ex post pro¢t rates depend on the dynamics of ex ante pro¢t rates while the latter depend on the dynamics of ex post pro¢t rates. We establish the existence of, and the convergence to, the``natural state'' in the light of this self-referential system. I IntroductionClassical economic theory propounded that an economic system`g ravitates'' towards the``natural state'' or long-run equilibrium. This convergence to the long-run equilibrium was part of the axiomatic and did not have a theoretical underpinning. However, recently there has been a spurt of interest, starting with the pioneering work of Nikaido (1978), to analyse this classical thesis critically. The outcomes are mixed. Nikaido (1978) highlighted the invalidity of such a global convergence in a limited model by formulating the quantity dynamics in the Jorgenson (1960) type dual-stability model and demonstrated the quantity instability. This, however, is a characteristic feature of the Jorgenson model whose quantity instability has spillover e¡ects on prices and pro¢t rates which clog the equilibrating forces of competition. Subsequently, Nikaido (1983) introduced a price adjustment mechanism into his rudimentary model and con¢rmed his earlier result. A close examination, however, reveals that the proposed price dynamics (his equations (50), (53) and (54)) di¡er from

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Price and quantity adjustment in a dynamic closed model: The dual stability theorem

Cited by 7 publications

References 20 publications

The dynamics of competition: a restoration of the classical analysis

The dynamics of competition: a restoration of the classical analysis

Équilibre de long terme, déséquilibre stationnaire et crise

Differential Profit Rates and Convergence to the Natural State

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