Macro Foundations of Microeconomics

M. L. Burstein

Chapter 2 in Studies in Banking Theory, Financial History and Vertical Control, 1988, pp 11-22 from Palgrave Macmillan

Abstract: Abstract The stationary state plays a very different rôle in classical or Keynesian than in neoclassical economics. In classical economics, it culminates an historical process contemplated by a grand speculation. And the ‘euthanasia of the rentier class’ passages of the General Theory are closely linked to the stylized histories of the classical writers (see Keynes, 1936, pp. 220–1 and 374–7). Neoclassical stationary-state analysis mostly runs in two channels: (1) the stationary state of Marshall and Pigou is a device for isolating certain problems in resource allocation; (2) work such as that of Clower and Burstein (1960), in the wake of Archibald and Lipsey (1958), envisages full-equilibrium states corresponding to states of microscopic equilibrium in the kinetic theory of gases. And rational-expectations approaches to economic equilibrium and the idea of general competitive equilibrium also seem consistent only with microscopic equilibrium.

Keywords: Neoclassical Economic; Economic Equilibrium; Calendar Date; Cash Balance; Microscopic State (search for similar items in EconPapers)
Date: 1988
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DOI: 10.1007/978-1-349-09978-8_2

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