Re: RE: Re: RE: Journal of Economic Perspectives

[Peter Dorman]

When I use the term "walrasian", that's shorthand for a methodology that
takes static optimization as the guiding framework, and that sees the economy
as an adding-up of individual optimization programs.  The two departures I
take that I see as "radical" (or at least different) are the replacement of
static optimization by dynamic strategy (repeated games) and adding-up by
interaction.  Market failure is supplemented by market incompleteness (large
and therefore indeterminate equilibrium sets).  And, since market
incompleteness is well-known and accounted for by real people, actions take
place within the context of institutions, and associated power relations,
that guide or delimit choice.  There's other stuff too about rationality, the
limits of utilitarianism, etc., but historical time and complex interaction
are central for me.

Peter

Max Sawicky wrote:

> If you're saying Hahnel is too fixed on markets
> and quasi-markets clearing, I don't think that's
> a handicap in this context.  If you don't start
> with markets and quasi-markets, what do you have?
> Organizations?
>
> mbs