Abstract
Economic theory is pre-eminently a matter of equilibrium analysis. In particular, the centrepiece of the subject — general equilibrium theory — deals with the existence and efficiency properties of competitive equilibrium. Nor is this only an abstract matter. The principal policy insight of economics — that a competitive price system produces desirable results and that government interference will generally lead to an inefficient allocation of resources — rests on the intimate connections between competitive equilibrium and Pareto efficiency.
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© 1989 Palgrave Macmillan, a division of Macmillan Publishers Limited
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Fisher, F.M. (1989). Adjustment Processes and Stability. In: Eatwell, J., Milgate, M., Newman, P. (eds) General Equilibrium. The New Palgrave. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-19802-3_2
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DOI: https://doi.org/10.1007/978-1-349-19802-3_2
Publisher Name: Palgrave Macmillan, London
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