Abstract
In classical theory, from Smith to Mill, fixed coefficients in production are assumed. In such a context, the individual firm plays little role in the general equilibrium of the economy. The scale of any one firm is indeterminate, but the demand conditions determine the scale of the industry and the demand by the industry for inputs. The firm’s role is purely passive, and no meaningful boundaries between firms are established. No doubt the firm or the entrepreneur was much discussed and indeed given a central role in the informal parts of the discussion; the role was that of overcoming disequilibria. When profit rates were unequal, profit-hungry entrepreneurs moved quickly, with the end-result of eliminating their functions.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Arrow, K. J., and Debreu, G. (1954) ‘Existence of equilibrium for a competitive economy’, Econometrica, xxii 265–90.
Arrow, K. J., Karlin, S., and Scarf, H. (1958) Studies in the Mathematical Theory of Inventory and Production (Stanford, Calif.: Stanford University Press).
Arrow, K. J., and Hahn, F. H. (forthcoming) Competitive Equilibrium Analysis(San Francisco: Holden-Day).
Burger, E. (1963) Introduction to the Theory of Games (Englewood Cliffs, N.J.: Prentice-Hall).
Bushaw, D. W., and Clower, R. W. (1957) Introduction to Mathematical Economics (Homewood, Ill.: Irwin).
Chamberlin, E. H. (1956) The Theory of Monopolistic Competition, 7th ed. (Cambridge, Mass.: Harvard University Press).
Debreu, G. (1959) Theory of Value (New York: Wiley).
Debreu, G. (1962) ‘New concepts and techniques for equilibrium analysis’, International Economic Review, in 257–73.
Farrell, M. J. (1959) ‘The convexity assumption in the theory of competitive markets’, Journal of Political Economy, Dom 377–91.
Hicks, J. R. (1939) Value and Capital (Oxford: Clarendon Press).
Hicks, J. R. (1965) Capital and Growth (New York and Oxford: Oxford University Press).
Hoffman, A. J., and Jacobs, W. (1954) ‘Smooth patterns of production’, Management Science, 186–91.
Holt, C. C., Modiglani, F., Muth, J. F., and Simon, H. A. (1960) Planning Production, Inventories, and Work Force (Englewood Cliffs, N.J.: Prentice-Hall).
Kakutani, S. (1941) ‘A generalization of Brouwer’s fixed-point theorem’, Duke Mathematical Journal, vm 451–9.
Kaldor, N. (1935) ‘Market imperfection and excess capacity’, Economica, n. s., n 33–50.
Kalecki, M. (1939) Essays in the Theory of Economic Fluctuations (New York: Farrar & Rinehart).
Keynes, J. M. (1936) The General Theory of Employment Interest and Money (New York: Harcourt Brace).
Marris, R. (1964) The Economic Theory of ‘Managerial’ Capitalism (Glencoe, Ill.: The Free Press of Glencoe).
McKenzie, L. (1954) ‘On equilibrium in Graham’s model of world trade and other competitive systems’, Econometrica, xxu 147–61.
McKenzie, L. (1959) ‘On the existence of general equilibrium for a competitive market’, Econometrica, xxvu 54–71.
McKenzie, L. (1961) ‘On the existence of general equilibrium: some corrections’, Econometrica, xxix 247–8.
Negishi, T. (1960–1) ‘Monopolistic competition and general equilibrium’, Review of Economic Studies xxvin 196–201.
Penrose, E. T. (1959) The Theory of the Growth of the Firm (New York and Oxford: Oxford University Press).
Robinson, J. (1933) The Economics of Imperfect Competition (London: Macmillan)
Rothenberg, J. (1960) Non-convexity, aggregation, and Pareto optimality,’ Journal of Political Economy, lxviii 435–68.
Schlesinger, K. (1933–4) ‘Ober die Produktionsgleichungen der ökonomischen Wertlehre’, Ergebnisse eines mathematischen Kolloquiums vi 10–11.
Starr, R. (1969) ‘Quasi-equilibria in markets with nonconvex preferences’, Econometrica, xxxvn 25–38.
Tompkins, C. B. (1964) ‘Sperner’s lemma and some extensions’, chap. 15 in E. F. Beckenbach (ed.), Applied Combinatorial Mathematics (New York, London, and Sydney: Wiley).
Triffin, R. (1940) Monopolistic Competition and General Equilibrium Theory (Cambridge, Mass.: Harvard University Press).
Wald, A. (1936) ‘Über einige Gleichungssysteme der mathematischen Ökonomie’, Zeitschrift für Nationalökonomie, vm 637–70. English translation (1951) ‘On some systems of equations of mathematical economics’, Econometrica, xix 368–403.
Williamson, O. E. (1964) The Economics of Discretionary Behavior (Englewood Cliffs, N.J.: Prentice-Hall).
Editor information
Copyright information
© 1971 The President and Fellow of Harvard College
About this chapter
Cite this chapter
Arrow, K.J. (1971). The Firm in General Equilibrium Theory. In: Marris, R., Wood, A. (eds) The Corporate Economy. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-01110-0_3
Download citation
DOI: https://doi.org/10.1007/978-1-349-01110-0_3
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-01112-4
Online ISBN: 978-1-349-01110-0
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)