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Joan Robinson was “probably the best economist alive” in Paul Samuelson’s own words.
@zachdcarter rightfully celebrated her work on monopolistic competition (without which there wouldn’t be new trade theory nor endogenous growth theory) & #monpsony.
Dismissing her work...
@zachdcarter rightfully celebrated her work on monopolistic competition (without which there wouldn’t be new trade theory nor endogenous growth theory) & #monpsony.
Dismissing her work...
...on #capital theory is wrong-headed, because it has fundamental implications for the theory of #distribution.
She realized that there is no “quantity of capital” independent of prices in a world with heterogeneous capital goods.
The existence of...
She realized that there is no “quantity of capital” independent of prices in a world with heterogeneous capital goods.
The existence of...
...such quantity of capital is *crucial* for the #neoclassical theory of distribution, which rests fundamentally on the possibility that price movements will ensure that f’(k) = r.
This “closes” the Solow growth model: the real wage will be determined residually: w = y-f’(k)k..
This “closes” the Solow growth model: the real wage will be determined residually: w = y-f’(k)k..
