A SHORT CRITIQUE OF PERFECT COMPETITION MODEL FROM THE PERSPECTIVE OF AUSTRIAN SCHOOL OF ECONOMICS

Andreas Stamate and Radu Muşetescu ()
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Radu Muşetescu: Bucharest Academy of Economic Studies
Authors registered in the RePEc Author Service: Radu Cristian Musetescu ()

Romanian Economic Business Review, 2011, vol. 6, issue 4, 112-122

Abstract: The perfect competition model is not the only model which we can use in analyzing the markets.Although it is quite clear that competition laws are based on it, there are not sufficient reasons to confirm its suitability for this enterprise. We raise the question of realism implied in concepts like ‘homogeneous products’ and ‘numerous participants’, and then we try to portrait the world as it is stated in the perfect neoclassical model. The discussion has powerful insights given by the Austrian methodology which in time proved to be a strong and efficient competitor for the neoclassical paradigm. The perfect competition model is opposed to free competition model, or the competition unhampered by any violent restrictions imposed to entrepreneurs in the process of satisfying the consumers.

Keywords: perfect competition; economic calculation; money; prices; uncertainty; profits (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:rau:journl:v:6:y:2011:i:4:p:112-122

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