Document Type
Discussion Paper
Publication Date
7-1-2007
CFDP Number
1615R
CFDP Revision Date
2013-07-01
CFDP Pages
7
Abstract
We show that all the fundamental properties of competitive equilibrium in Marshall’s cardinal theory of value, as presented in Note XXI of the mathematical appendix to his Principles of Economics (1890), derive from the Strong Law of Demand. That is, existence, uniqueness, optimality, and global stability of equilibrium prices with respect to tatonnement price adjustment follow from the cyclical monotonicity of the market demand function in the Marshallian general equilibrium model.
Recommended Citation
Brown, Donald J. and Calsamiglia, Caterina, "Alfred Marshall's Cardinal Theory of Value: The Strong Law of Demand" (2007). Cowles Foundation Discussion Papers. 1912.
https://elischolar.library.yale.edu/cowles-discussion-paper-series/1912