Equilibrium Quotes - page 4
I can date my own personal 'revolution' rather exactly to May or June 1933. It was like this. It began... with Hayek. His "Prices and Production" is one of the influences that can be detected in The Theory of Wages; it could not have been otherwise, for 1931 was a Prices and Production year at the London School of Economics... I did not in fact find it all easy to fit in with my own ideas. What started me off in 1933 was an earlier work of Hayek's, his paper on 'Intertemporal Equilibrium', an idea which I found easier to reduce to my preferred (Paretian or Wicksellian) pattern.
John Hicks
In the first place I identify this ["the equilibrium of poverty"] with primitive agriculture, and two factors have been at work there. One is, of course, population growth. If you were a poor farmer in India, Pakistan, or in much of Africa, you would want as many sons as possible as your social security. They would keep you out of the hot sun and give you some form of subsistence in your old age. So, you have pressure for population growth that is, itself, the result of the extreme economic insecurity. This is something which hasn't been sufficiently emphasized.
John Kenneth Galbraith
The question always is, will it pay to bring an extra exchange transaction under the organizing authority? At the margin, the costs of organizing within the firm will be equal either to the costs of organizing in another firm or to the costs involved in leaving the transaction to be "organised” by the price mechanism. Business men will be constantly experimenting, controlling more or less, and in this way equilibrium will be maintained. This gives the position of equilibrium for static analysis.
Ronald Coase
Multiple discoveries are in fact very common in science and for much the same reason. Developments in related fields with different motivation help one to understand a difficult problem better. Since these developments are public knowledge, many scholars can take advantage of them. It is pleasant to the ego to be first or among the first with a new discovery. However, in this case at least, the evidence is clear that the development of general equilibrium theory would have gone on quite as it did without me.
Kenneth Arrow
I then follow up with four major aspects of economic research in the last 60 years, the period of my scholarly activity. One, econometric methodology and practice, is of such fundamental importance that it cannotgo unnoticed, although I played no role in it. With the other three, general equilibrium, dynamic processes, and uncertainty and information, I was more intimately involved.
Kenneth Arrow
Imagine each family as a kind of little factory--a multiperson unit producing meals, health, skills, children, and self-esteem from market goods and the time, skills, and knowledge of its members. This is only one of the remarkable concepts explored by Gary Becker in his landmark work on the family. Becker applies economic theory to the most sensitive and fateful personal decisions, such as choosing a spouse or having children. He uses the basic economic assumptions of maximizing behavior, stable preferences, arid equilibria in explicit or implicit markets to analyze the allocation of time to child care as well as to careers, to marriage and divorce in polygynous as well as monogamous societies, to the increase and decrease of wealth from one generation to another.
Gary Becker
L. Walras first formulated the state of the economic system at any point of time as the solution of a system of simultaneous equations representing the demand for goods by consumers, the supply of goods by producers and the equilibrium condition that supply equal demand on every market.
Kenneth Arrow
A minimum of unconsciousness is necessary if one wants to stay inside history. To act is one thing; to know one is acting is another. When lucidity invests the action, insinuates itself into it, action is undone, and with it, prejudice, whose function consists, precisely, in subordinating, in enslaving consciousness to action. The man who unmasks his fictions renounces his own resources and, in a sense, himself. Consequently, he will accept other fictions which will deny him, since they will not have cropped up from his own depths. No man concerned with his equilibrium may exceed a certain degree of lucidity and analysis.
Emil Cioran
L. Walras first formulated the state of the economic system at any point of time as the solution of a system of simultaneous equations representing the demand for goods by consumers, the supply of goods by producers and the equilibrium condition that supply equal demand on every market.
Gérard Debreu
Keynes did not challenge the efficacy of price adjustment mechanisms in clearing particular markets in the Marshallian partial equilibrium theory on which he had been reared. He did challenge the mindless application of those mechanisms to economy-wide markets. Founding what came to be known as macroeconomics, he was modeling a whole economy as a closed system. He knew he could not use the Marshallian assumption that the clearing of one market could be safely described on the assumption that the rest of the economy was unaffected.
James Tobin
There is no permanent equilibrium in human affairs. Faith, wisdom, and art allow one to attain it for a time; then outside influences and the souls' passions destroy it, and one must climb the rock again in he same manner. This vacillation round a fixed point is life, and the certainty that such a point exists is happiness. As the most ardent love, of one analyses its separate moments, is made up of innumerable minute conflicts settled invariably by fidelity, so happiness, if one reduces it to its important elements, is made up of struggles and anguish, and always saved by hope.
André Maurois
With the publication of J. M. Keynes's General Theory in 1936 and the mathematical formalizations of his theory by J. R. Hicks (1937) and others, the language of macro-economic theory became systems of simultaneous equations. These are general equilibrium systems of interdependence in the sense that the relationships describe an entire national economy, not just a particular industry or sector. The systems are usually not completely closed; they depend on exogenous parameters including instruments controlled by policy-makers. Seeking definite relationships of economic outcomes to policies and other exogenous variables, qualitative and quantitative, these models sacrifice detail and generality, limiting the number of variables and equations by aggregations over agents, commodities, assets, and time.
James Tobin
Social stability is ensured, not by the cessation of the demand for change – for the needy and the restless will never cease to cry for it – but by the fact that change in its progress must at last hurt some class of men who are strong enough to arrest it. The army of so-called reform, in every stage of its advance, necessarily converts a detachment of its force into opponents. The more rapid the advance the more formidable will the desertion become, till at last a point will be reached where the balance between the forces of conservation and destruction will be redressed, and the political equilibrium be restored.
Robert Gascoyne-Cecil, 3rd Marquess of Salisbury
