Competitive markets and “as if” methodology

Antonio Quesada

Microeconomics from University Library of Munich, Germany

Abstract: Two results showing the limitations of the “as if” methodology are proved under relatively mild assumptions. In an interpretation of the results, a competitive market cannot simulate the outcome of a market M in which the single price assumption does not hold. In a second interpretation, the market M resulting from the aggregation of a finite number of competitive markets is not competitive. In both cases there is no ground to sustain the fiction that M operates as if it were competitive.

Keywords: “As if” methodology; Competitive market; Market aggregation; Market simulation; Price aggregation. (search for similar items in EconPapers)
JEL-codes: D40 E10 (search for similar items in EconPapers)
Pages: 8 pages
Date: 2005-04-11
New Economics Papers: this item is included in nep-hpe and nep-mac
Note: Type of Document - pdf; pages: 8
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/mic/papers/0504/0504003.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpmi:0504003

Access Statistics for this paper

More papers in Microeconomics from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ( this e-mail address is bad, please contact ).