Year: 1981
Author: Arndt, Helmut
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 101 (1981), Iss. 5 : pp. 459–477
Abstract
The founders of the Utility School (and their followers) have mistaken the individual utility of a given good for the utility which a commodity, sold on a market, has for a member of the community: A "homo socialis" is not a Robinson. The doctrin of "perfect elastic demand" is based on the fallacy that the consequence of a given price ("Datum") is "infinite demand" which is not true. If demand as well as sales are in any case limited a special theory of "imperfect competition" proves as unnecessary for axplaining deviations from the "Law of diminishing returns" as Sraffa has tried. A lack of homogeneity is also not sufficient to bring about a "competition of substitutes". Complementary goods are heterogeneous, too, but they don't compete. Markets as well as competition cannot be explained by any "law" (as Jevons and his followers believed) but only by their economic functions. Jevons found already that the equations of the Utility School's theory of value are "exactly similar in form" to the equations of the theory of the lever. However, is it permissible to simplify economic relations to the mechanism of the lever? Or have economists not to be aware of the fact that human beings and their actions are completely different from the lever and its kinetic laws?
Journal Article Details
Publisher Name: Global Science Press
Language: Multiple languages
DOI: https://doi.org/10.3790/schm.101.5.459
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 101 (1981), Iss. 5 : pp. 459–477
Published online: 1981-05
AMS Subject Headings: Duncker & Humblot
Copyright: COPYRIGHT: © Global Science Press
Pages: 19