Introduction

Walras developed a mature model of markets for consumer goods and services and of markets for the primary materials and productive services used to make those commodities. That description of the model and the introduction to this book explain why Walras will not be followed in calling the subject of this chapter “the theory of production.” The model was poorly understood by Walras's contemporaries and has been unrecognized in the twentieth century. In this chapter and the next, this model is frequently called, for brevity, “the consumer commodities model,” but it is not to be confused with the consumer commodities model discussed in section 2. It is also quite different from the consumer commodities model that he wanted to construct during the last phase of his thought and that has erroneously been considered as his best work on the subject. The objectives of the chapter are to identify the parameters of the model, to determine whether or not money is used in it, and to identify and explain those aspects of the structure of the model that are relevant for the determination of prices, rates of production, and sales of consumer commodities, and of the services and primary materials used to make them.