Kemp-Benedict, E. orcid.org/0000-0001-5794-7172 (2017) Dynamic Stability of Post-Keynesian Pricing. The B.E. Journal of Theoretical Economics (BEJTE), 17 (2). 20160013. pp. 651-664. ISSN 2194-6124
Abstract
Conventional economic theory assumes a Walrasian pricing mechanism that is known to pose theoretical difficulties. Less well-known is that conventional price theory conflicts with empirical studies of price-setting in industrial firms. Post-Keynesian theory, which assumes mark-up pricing on normal costs and infrequent price changes, is consistent with observation, and we show in this paper that post-Keynesian pricing, unlike conventional pricing, features stable dynamics. We focus on the short run, because post-Keynesian theory posits complex and historically-contingent long-Term price dynamics. Specifically, we show that under very general conditions, prices converge to a unique equilibrium price vector.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2017 De Gruyter. This is an author produced version of an article accepted for publication in The B.E. Journal of Theoretical Economics. Uploaded in accordance with the publisher's self-archiving policy. |
Keywords: | general equilibrium; prices; post-Keynesian; Perron-Frobenius theorem; Sraffian |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Environment (Leeds) > School of Earth and Environment (Leeds) > Sustainability Research Institute (SRI) (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 05 Dec 2024 15:14 |
Last Modified: | 05 Dec 2024 15:14 |
Status: | Published |
Publisher: | De Gruyter |
Identification Number: | 10.1515/bejte-2016-0013 |
Related URLs: | |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:220496 |