Skip to main content
SpringerLink
Log in

Developments in the theory of general equilibrium

  • Published:
De Economist Aims and scope Submit manuscript

Summary

In this article the development of the theory of general equilibrium during the last twenty-five years or so is discussed. The Arrow-Debreu model with futures markets is considered and it is shown that careful analysis of this model gave rise to temporary equilibrium models. The study of these models and of the stability of price adjustments resulted in turn in the formulation of fixed price equilibrium models. Much attention is paid to the simple fixed price equilibrium model as it was defined by Barro and Grossman and Malinvaud. The different types of equilibrium in this model are discussed. The problems arising when the model is extended with investment are analysed and some special cases are considered.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Arrow, K.J.,Essays in the Theory of Risk-bearing, Amsterdam, 1971.

  • Arrow, K.J., H.D. Block and L. Hurwicz, ‘On the Stability of the Competitive equilibrium II,’Econometrica, 27 (1959), pp. 82–109.

    Google Scholar 

  • Arrow, K.J. and G. Debreu, ‘Existence of an Equilibrium for a Competitive Economy,’Econometrica, 22 (1954), pp. 265–290.

    Google Scholar 

  • Arrow, K.J. and F.H. Hahn,General Competitive Analysis, San Francisco, 1971.

  • Arrow, K.J. and L. Hurwicz, ‘On the Stability of the Competitive Equilibrium I,’Econometrica, 26 (1958), pp. 522–552.

    Google Scholar 

  • Arrow, K.J. and M. Intriligator (eds.),Handbook of Mathematical Economics, Amsterdam, 1982.

  • Barro, R.J. and H.I. Grossman, ‘A General Disequilibrium Model of Income and Employment,’American Economic Review, 61 (1971), pp. 82–93.

    Google Scholar 

  • Benassy, J.P., ‘Neo-Keynesian Disequilibrium in a Monetary Economy,’Review of Economic Studies,’ 41 (1975), pp. 503–523.

    Google Scholar 

  • Böhm, V., ‘Disequilibrium Dynamics in a Simple Macro Economic Model,’Journal of Economic Theory, 17 (1978), pp. 177–199.

    Google Scholar 

  • Böhm, V.,Preise, Löhne und Beschäftigung, Tübingen, 1980.

  • Cass, D., ‘On Capital Overaccumulation in the Aggregative Neoclassical Model of Economic Growth: A Complete Characterisation,’Journal of Economic Theory, 4 (1972a), pp. 200–223.

    Article  Google Scholar 

  • Cass, D., ‘Distinguishing Inefficient Competitive Growth Paths,’Journal of Economic Theory, 4 (1972b), pp. 224–240.

    Article  Google Scholar 

  • Clower, R.W., ‘The Keynesian Counterrevolution: A Theoretical Appraisal,’ in: F.H. Hahn and R.W. Brechling (eds.),The Theory of Interest Rates, London, 1965.

  • Debreu, G.,Theory of Value, New York, 1959.

  • Debreu, G., ‘Economics with a Finite set of Equilibria,’Econometrica, 38 (1970), pp. 387–392.

    Google Scholar 

  • Debreu, G., ‘Existence of Competitive Equilibrium,’ Chapter 15 in: Arrow and Intriligator, (1982).

  • Drèze, J.H., ‘Existence of an Exchange Equilibrium under Price Rigidities,’International Economic Review, 16 (1975), pp. 301–320.

    Google Scholar 

  • Evers, J., ‘Het probleem van de brug of de beoefening van de operationele research,’ Oratie T.H.T., 1978.

  • Fuchs, G., ‘Asymptotic Stability of Stationary Temporary Equilibria and Changes of Expectations,’Journal of Economic Theory, 12 (1976), pp. 201–216.

    Article  Google Scholar 

  • Gale, D. and A. Mas. Collell, ‘An Equilibrium Existence Theorem for a General Model without Ordered Preferences,’Journal of Mathematical Economics, 2 (1975), pp. 19–25.

    Article  Google Scholar 

  • Grandmont, J.M., ‘On the Short Run Equilibrium in a Monetary Economy,’ in: J. Drèze (ed.),Allocation under Uncertainty, Equilibrium and Optimality, London, 1974.

  • Grandmont, J.M., ‘Temporary General Equilibrium Theory,’Econometrica, 45 (1977), pp. 535–572. (Also Chapter 19 in: Arrow, K.J. and M. Intriligator (1982)).

    Google Scholar 

  • Grandmont, J.M. and Y. Younes, ‘On the Efficiency of a Monetary Equilibrium,’Review of Economic Studies, 40 (1974), pp. 149–165.

    Google Scholar 

  • Hahn, F.H. (1962), ‘On the Stability of Pure Exchange Equilibrium,’International Economic Review, 3 (1962), pp. 206–213.

    Google Scholar 

  • Hahn, F.,On the Notion of Equilibrium in Economics, Cambridge, 1973.

  • Hahn, F.H.,Money and Inflation, Oxford, 1982.

  • Heuvel, P. v.d.,The Stability of a Macro-economic System with Quantity Constraints, Lecture Notes in Economics and Mathematical Systems, 211, Berlin, 1983.

  • Hicks, J.R.,Value and Capital, Oxford, 1939.

  • Hildenbrand, K. and W. Hildenbrand (1978), ‘On Keynesian Equilibriawith Unemployment and Quantity Rationing,’Journal of Economic Theory, 4 (1978), pp. 545–551.

    Google Scholar 

  • Honkapohja, S., ‘On the Dynamics of Disequilibria in a Macro Model with Flexible Wages and Prices,’ in: M. Aoki and A. Marzollo (eds.),New Trends in Dynamic System Theory and Economics (Part III, Disequilibrium Analysis), New York, 1979.

  • Honkapohja, S. and T. Ito, ‘Stability with Regime Switching,’Journal of Economic Theory, 29 (1983), pp. 22–48.

    Article  Google Scholar 

  • Kahn, R., ‘Malinvaud on Keynes,’ (review article),Cambridge Journal of Economics, 1 (1979), pp. 375–388.

    Google Scholar 

  • Kooiman, P., ‘Using Business Survey Data in Empirical Disequilibrium Models,’ mimeo-graphed, London School of Economics, 1982.

  • Kornai, J.,Anti-Equilibrium, Amsterdam, 1971.

  • Kuipers, S.K., Book review of Malinvaud (1980),De Economist, 129 (1981), pp. 151–155.

    Article  Google Scholar 

  • Kuné, J.B., ‘The Introduction of an Old Age Pension in a Neoclassical Economy,’Mitteilungen der schweizerische Vereinigung von Versicherungsmathematiker, 32 (1982), pp. 213–223.

    Google Scholar 

  • Laan, G. v.d., ‘Unemployment Equilibria: Some Results on Existence and Optimality of Fixed Price Equilibria with Supply Rationing,’ mimeographed, Free University, Amsterdam, 1981.

    Google Scholar 

  • Laroque, G., ‘On the Local Uniqueness of the Fixed Price Equilibria,’Review of Economic Studies, XLVIII (1981a), pp. 113–129.

    Google Scholar 

  • Laroque, G., ‘A Comment on “Stable Spillovers among Substitutes”,’Review of Economic Studies, XLVIII (1981b), pp. 355–361.

    Google Scholar 

  • Lenderink, R.S.S. and J.C. Siebrand,A Disequilibrium Analysis of the Labour Market, Rotterdam, 1976.

  • Madden, P., ’Macroeconomic Shutdown under Increasing Returns and Set-up Costs,’ mimeographed, Dept. of Econometrics, University of Manchester, 1983.

  • Malinvaud, E., ‘Capital Accumulation and Efficient Allocation of Resources,’Econometrica, 21 (1953), pp. 233–268.

    Google Scholar 

  • Malinvaud, E.,The Theory of Unemployment Reconsidered, Oxford, 1977.

  • Malinvaud, E.Profitability and Unemployment, Cambridge, 1980.

  • Malinvaud, E., ‘Wages and Unemployment,’Economic Journal, 92 (1982), pp. 112.

    Google Scholar 

  • McKenzie, L.W., ‘On the Existence of General Equilibrium for a Competitive Market,’Econometrica, 27 (1959), pp. 54–71.

    Google Scholar 

  • Muellbauer, J. and R. Portes, ’Macroeconomic Models with Quantity Rationing,’Economic Journal, 99 (1978), pp: 788–821.

    Google Scholar 

  • Negishi, T., ‘Monopolistic Competition and General Equilibrium Theory,’Review of Economic Studies, 28 (1961), pp. 196–201.

    Google Scholar 

  • Negishi, T., ‘The Stability of a Competitive Economy; A Survey Article,’Econometrica, 30 (1964), pp. 635–669.

    Google Scholar 

  • Radner, R., ‘Rational Expectations Equilibrium Generic Existence and the Information Revealed by Prices,’Econometrica, 47 (1977), 655–678.

    Google Scholar 

  • Samuelson, P.A. (1958), ‘An Exact Consumption Loan Model with or without the Social Contrivance of Money,’Journal of Political Economy, 66 (1958), pp. 467–482.

    Article  Google Scholar 

  • Schouten, D.B.J.,Exacte economie, Leiden, 1957.

  • Shafer, W. and H. Sonnenschein, ‘Equilibrium without Ordered Preferences in Abstract Economies,’Journal ofMathematical Economics, 2 (1975), pp. 345–348.

    Article  Google Scholar 

  • Sylvestre, J., ‘Fixprice Analysis in Exchange Economies,’Journal of Economic Theory, 26 (1982), pp. 28–58.

    Article  Google Scholar 

  • Veendorp, E., ‘Stable Spill-rivers among Substitutes,’Review of Economic Studies, XLII (1975), pp. 445–456.

    Google Scholar 

  • Wald, A., Über einige Gleichungssysteme der mathematischen Ökonomie,’Zeitschrift für Nationalökonomie, 7 (1936), pp. 637–670.

    Article  Google Scholar 

  • Walras, L.,Eléments d'économie politique pure, Lausanne, 1874.

  • Weddepohl, C., ‘Increasing Returns and Fixed Market Shares,’International Economic Review, 14 (1978), pp. 405–414.

    Google Scholar 

  • Weddepohl, C., ‘An Equilibrium Model with Fixed Labour Time,’Econometrica, 47 (1979), pp. 921–938.

    Google Scholar 

  • Weddepohl, C., ‘Piecewise Linear Liapunov Functions in the Spill-over Model,’ A.E. report 15/1981.

  • Weddepohl, C., ’Equilibria with Rationing in an Economy with Increasing Returns,’Journal of Economic Theory, 26 (1982), pp. 143–163.

    Article  Google Scholar 

  • Weddepohl, C., ‘Fixed Price Equilibria in a Multifirm Model,’Journal of Economic Theory, 29 (1983), pp. 95–108.

    Article  Google Scholar 

  • Weintraub, E.R.,Microfoundations, the Compatibility of Microeconomics and Macroeconomics, Cambridge, 1979.

  • Younes, Y., ‘Sur les notions d'éequilibre et de déséequilibre dans les mòdels décrivant l'évolution d'une éeconomie capitaliste,’ C.E.P. R.E.M. A.P., Paris, 1970.

Download references

Author information

Authors and Affiliations

  1. Mathematical Economics at the University of Amsterdam, The Netherlands

    Claus Weddepohl

Authors
  1. Claus Weddepohl
    View author publications

    You can also search for this author in PubMed Google Scholar

Additional information

This article is a revised version of the author's inaugural lecture, delivered on September 20th, 1982. Comments by a referee on an earlier version are gratefully acknowledged.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Weddepohl, C. Developments in the theory of general equilibrium. De Economist 131, 373–399 (1983). https://doi.org/10.1007/BF01985957

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/BF01985957

Keywords

Search

Navigation