Inventories and the Fixprice Method

Guy Laroque

Chapter 8 in Value and Capital: Fifty Years Later, 1991, pp 205-231 from Palgrave Macmillan

Abstract: Abstract Value and Capital has laid the modern foundations of dynamic economics. It has had a long-lasting influence on the way economists think of the evolution of the economic system: a sequence of stable temporary (competitive) equilibria. In the current period, given initial stocks, and the way economic agents form their expectations, a stable temporary equilibrium is established. Here stability means that ‘a slight movement away from the equilibrium position should set up forces tending to restore equilibrium’ (p. 62). Then the initial condi tions are modified for the next period (stocks accumulate or decumu late, tastes change, expectations are revised) and this creates the dynamics of the economy.

Keywords: Finite Time; Inventory Level; Excess Demand; Competitive Equilibrium; Excess Supply (search for similar items in EconPapers)
Date: 1991
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Persistent link: https://EconPapers.repec.org/RePEc:pal:intecp:978-1-349-11029-2_14

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DOI: 10.1007/978-1-349-11029-2_14

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