On Walras's concept of equilibrium

ARIEL DVOSKIN; ANDRÉS LAZZARINI

Buenos Aires

Seminario; Seminario de Economistas Argentinos en el Exterior; 2009

Departamento de Economía de la Faculatad de Ciencias Económicas de la UBA

It is generally acknowledged in the history of economic ideas that despite Walras's Elements was not amply received by his peers at that time, his work was taken up later in the 1930s, and profoundly modified over the following decades. In fact, along the years, the view that Walras's original equilibrium concept would have referred to a temporary equilibrium with stationary expectations turned to be the conventional and accepted opinion. In this paper we argue that such interpretation overlooks many substantial aspects underlying his equilibrium concept, namely, that the concept of equilibrium grasped by the French author refers to a centre of gravitation, that the equilibrium describes a persistent position of the economic variables, that the concept of equilibrium must be assessed together with its adjustment mechanisms implied in such a notion and that equilibrium must not be regarded as being a mere artificial model portrayed in logical time disconnected from reality but as a device to understand actual economies in order to be a guide for public policy. But a temporary equilibrium approach is of very little avail to such an attempt. The question which arises is, why would Walras have conceived a temporary notion for his purposes? We argue then that the aims and scopes of Walras's theoretical work, in particular the , but also in his Etudes d'Economie Politique Applique, could be better grasped by interpreting the French author as aiming to describe a long period position of the economic system, hence adopting the same methodological position as the bulk of neoclassical authors of that time.