Economic Modelling and the Concept of Equilibrium

Mark Setterfield

Chapter 1 in Rapid Growth and Relative Decline, 1997, pp 5-19 from Palgrave Macmillan

Abstract: Abstract There exist a number of definitions of the concept of economic equilibrium. One idea of equilibrium is that of a situation characterized by ‘offsetting forces’ — as, for example, when supply equals demand. A somewhat broader conception defines equilibrium as any state of rest which displays no endogenous tendencies to change over time.1 There also exist a variety of model specific definitions of equilibrium. For example, in certain theories of the business cycle, equilibrium is characterized in terms of the way that individuals form conditional expectations.2

Keywords: Coordination Mechanism; Multiple Equilibrium; Equilibrium Configuration; Relative Decline; Walrasian Equilibrium (search for similar items in EconPapers)
Date: 1997
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DOI: 10.1057/9780230375871_1

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