Perfect Competition

M. Khan

MPRA Paper from University Library of Munich, Germany

Abstract: In his 1987 entry on ‘Perfect Competition’ in The New Palgrave, the author reviewed the question of the perfectness of perfect competition, and gave four alternative formalisations rooted in the so-called Arrow-Debreu-Mckenzie model. That entry is now updated for the second edition to include work done on the subject during the last twenty years. A fresh assessment of this literature is offered, one that emphasises the independence assumption whereby individual agents are not related except through the price system. And it highlights a ‘linguistic turn’ whereby Hayek’s two fundamental papers on ‘division of knowledge’ are seen to have devastating consequences for this research programme.

Keywords: Allocation of Resources; Perfect Competition; Exchange Economy (search for similar items in EconPapers)
JEL-codes: D00 (search for similar items in EconPapers)
Date: 2007
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Related works:
Working Paper: Perfect Competition (2007)
Working Paper: Perfect Competition (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:2202

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