The Le Chatelier Principle can be 'Expected' to Hold Globally: Implications of Rationality in Constrained and Unconstrained Situations - (Now published in 'Journal of Economic Theory', 87 (1999), pp.416-428.)

Kevin Roberts

STICERD - Theoretical Economics Paper Series from Suntory and Toyota International Centres for Economics and Related Disciplines, LSE

Abstract: Although conditions that exhaust the implications of rationality (homogeneity, symmetry, definiteness) are well known, these apply under a single set of constraints. If a situation can be compared with another situation were extra constraints are imposed, there are stronger implications. One example is the (local) Le Chatelier Principle. A global Le Chatelier Principle does not always hold, and cannot always hold; but a global Le Chatelier Principle in Expectation applies with weak conditions on the density underlying the expectation. This Principle is implied by and exhausts the implication of rationality. An application of this result is that aggregate supply mauy satisfy a Global Le Chatelier Principle though it is never always satisfied by an individual supply function.

Date: 1996-01
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cep:stitep:/1996/298

Access Statistics for this paper

More papers in STICERD - Theoretical Economics Paper Series from Suntory and Toyota International Centres for Economics and Related Disciplines, LSE
Bibliographic data for series maintained by ().