Abstract
Systems of general market equilibrium are too detailed to serve as a basis for empirical application. In this chapter they are given up in favour of an analysis with a much broader sweep, in terms of industries rather than firms. Many difficulties are then avoided; for example, when no attention is paid to the way in which an industry is composed of decision-taking units, it is quite appropriate to assume both pure competition (given prices) and free entry (zero profits). This is at the cost of introducing a concept—that of an industry—which is both imprecise and a rough approximation. Industries are essentially empirical aggregates based on some statistical classification; the output of an industry, for example, is not a single product, as may be assumed for convenience, but rather a complex of main and subsidiary products.
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© 1959 R. G. D. Allen
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Allen, R.G.D. (1959). Inter-Industry Relations. In: Mathematical Economics. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-81547-0_11
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DOI: https://doi.org/10.1007/978-1-349-81547-0_11
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