Book contents
- Frontmatter
- Contents
- List of figures
- Preface
- Acknowledgments
- Introduction
- Part I The models of the mature phase
- 1 Walras's conception of a competitive market economy
- 2 The mature models: Not a normative scheme
- 3 The mature models of the barter of stocks of commodities
- 4 Institutions and participants in the model of monetary oral pledges markets
- 5 Disequilibrium and equilibrium in the model of monetary oral pledges markets
- 6 The structure of the mature nondurable consumer commodities model
- 7 The equilibrating processes in the mature nondurable consumer commodities model
- 8 The structure of the mature comprehensive model
- 9 The equilibrating processes in the mature comprehensive model
- 10 Walras and his critics on the maximum utility of new capital goods
- 11 The mature models of the money market
- 12 Iteration in the mature model of tatonnement
- 13 The mature model of the behavior of the entrepreneur
- 14 Walras versus Edgeworth on tatonnement processes
- Part II The models of the phase of decline
- References
- Collation of editions of the Eléments
- Index
4 - Institutions and participants in the model of monetary oral pledges markets
Published online by Cambridge University Press: 05 May 2010
- Frontmatter
- Contents
- List of figures
- Preface
- Acknowledgments
- Introduction
- Part I The models of the mature phase
- 1 Walras's conception of a competitive market economy
- 2 The mature models: Not a normative scheme
- 3 The mature models of the barter of stocks of commodities
- 4 Institutions and participants in the model of monetary oral pledges markets
- 5 Disequilibrium and equilibrium in the model of monetary oral pledges markets
- 6 The structure of the mature nondurable consumer commodities model
- 7 The equilibrating processes in the mature nondurable consumer commodities model
- 8 The structure of the mature comprehensive model
- 9 The equilibrating processes in the mature comprehensive model
- 10 Walras and his critics on the maximum utility of new capital goods
- 11 The mature models of the money market
- 12 Iteration in the mature model of tatonnement
- 13 The mature model of the behavior of the entrepreneur
- 14 Walras versus Edgeworth on tatonnement processes
- Part II The models of the phase of decline
- References
- Collation of editions of the Eléments
- Index
Summary
For many years, the opinion has been expressed in the literature on Léon Walras's work that he did not pay attention to market institutions in his models of market behavior. It is shown that in fact he founded his model of a monetary oral pledges market on a detailed specification of the institutions and other structural features that condition the traders' behavior, including rules, conventions, kinds of firms represented, and kinds of commodities and trades. It is also shown that he explained how the phenomena and processes of organized markets arise from economic needs and are related to other economic processes. He drew on empirical information to construct his model, and illuminated that information with his theoretical perceptions.
Introduction
The current view
The current view of Walras's work is that he did not pay attention to market institutions – namely, to the complex of rules and procedures that regulate and influence the behavior of the participants. William Jaffé expressed that view by writing that “Léon Walras sought to systematize the economic forces that he regarded in specie aeternitatis, i.e. economic forces which he thought were independent of institutional constraints” (Jaffé 1971, p. 98 [279]). Jaffé agreed with Oskar Lange that “the general equilibrium model of the Lausanne type is devoid of any specification of the institutional framework, precisely because it consists in nothing more than a pure theory of exchange, production and capital formation, positing only a freely competitive market of the atomistic variety” (ibid., p. 100 [281]).
- Type
- Chapter
- Information
- Walras's Market Models , pp. 76 - 92Publisher: Cambridge University PressPrint publication year: 1996