The Calculating Auctioneer, Enlightened Wage Setters, and the Fingers of the Invisible Hand

23 Pages Posted: 11 Mar 2013 Last revised: 22 May 2015

Egmont Kakarot-Handtke

University of Stuttgart - Institute of Economics and Law

Date Written: March 9, 2013

Abstract

The formal foundations of theoretical economics must be nonbehavioral and epitomize the interdependence of real and nominal variables that constitutes the monetary economy. This is a cogent conclusion from the persistent collapse of behavioral and real models. Conceptual rigor demands, first, to take objective-structural axioms as a formal point of departure and, secondly, to clarify the interrelations of the fundamental concepts income and profit. The present paper reconstructs the characteristic properties of a Walrasian economy in structural axiomatic terms, generalizes them and explores the consequences for our understanding of the working of the economy we happen to live in.

Keywords: new framework of concepts, structure-centric, axiom set, analytical rigor, market clearing, budget balancing, harmonic structure, deflationary bias

JEL Classification: D01, D46, D51

Suggested Citation

Kakarot-Handtke, Egmont, The Calculating Auctioneer, Enlightened Wage Setters, and the Fingers of the Invisible Hand (March 9, 2013). Available at SSRN: https://ssrn.com/abstract=2230822 or http://dx.doi.org/10.2139/ssrn.2230822

Egmont Kakarot-Handtke (Contact Author)

University of Stuttgart - Institute of Economics and Law ( email )

Keplerstrasse 17
Stuttgart
Germany

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