The Relevance of the Marshallian Concept of Normality in Interior and Inertial Dynamics as Revisited by Shackle and Kornai

Mehrdad Vahabi

Chapter Chapter 12 in The Legacy of Janos Kornai, 2025, pp 183-220 from Palgrave Macmillan

Abstract: Abstract This study endeavours to explicate the relevance of the Marshallian concept of normality in the evolution of supply curves and the price mechanism in time. This concept is based on the contradictory, or at least ambiguous, combination of an ex ante perspective of expectation formation and an ex post inertial dynamics. We first explore the ex ante side of the contradiction by drawing upon the writings of Shackle. Subsequently, we examine Kornai’s conception of the normal state as system-specific. We identify the relationship between normality and the coordination mechanism in Kornai’s ex post approach which may be regarded as an alternative to Shackle’s solution. Finally, the pertinence of the Marshallian concept of normality will be demonstrated, as will its divergent developments by Shackle and Kornai. This leads us to the conclusion that a further development of the concept is required in order to reconcile both ex ante and ex post approaches; this might be based on recent evolutionary analysis.

Keywords: Coordination mechanisms; Economic dynamics; Ex ante and ex post visions of time; Marshallian equilibrium; Normal price; Normal equilibrium; Walrasian equilibrium (search for similar items in EconPapers)
Date: 2025
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Journal Article: The Relevance of the Marshallian Concept of Normality in Interior and Inertial Dynamics as Revisited by Shackle and Kornai (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:pal:pshchp:978-3-031-83239-0_12

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DOI: 10.1007/978-3-031-83239-0_12

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