 Price Rigidity and Market-Clearing: A Conceptual ClarificationCambridge Journal of Economics, 2001, vol. 25, issue 5, 639-55 Abstract: This article tests the view (derived from Hicks and Patinkin) that non-market clearance may be caused by slow adjustment ("process rigidity"). There are models where market-rationing is present and derives from some form of rigidity, but this rigidity cannot be considered as process rigidity. It is similarly possible to accommodate the idea of process rigidity within the Marshallian research programme. What is missing is that market-rationing might be its corollary. The reason such a causal link is often believed to exist lies in a generic use of the concept of rigidity, used to designate alternative and incompatible phenomena: "exogenous end-state rigidity" and "equilibrium end-state rigidity", as well as process rigidity. It is true that these first two forms of rigidity create market rationing. The belief that slow adjustment also generates market rationing results from the unwarranted extension to process rigidity of conclusions which are only valid for the first two. Copyright 2001 by Oxford University Press. Date: 2001 There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:oup:cambje:v:25:y:2001:i:5:p:639-55 Ordering information: This journal article can be ordered from Access Statistics for this article Cambridge Journal of Economics is currently edited by Jacqui Lagrue More articles in Cambridge Journal of Economics from Cambridge Political Economy Society Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK. |
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