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The Structural Price Mechanism

17 Pages Posted: 12 Oct 2013 Last revised: 18 Apr 2015

Egmont Kakarot-Handtke

University of Stuttgart - Institute of Economics and Law

Date Written: October 10, 2013

Abstract

Standard economics rests on behavioral assumptions that are formally expressed as axioms. With the help of additional assumptions like perfect competition and equilibrium a price vector is established that displays a host of desired properties. This approach is tightly stuck in a cul-de-sac. Conceptual rigor demands to discard the subjective-behavioral axioms and to take objective-structural axioms as the point of departure. The present paper reconstructs the price system in structural axiomatic terms for the most elementary economic configuration. The generalization of the structural price mechanism supplants the collapsed Walrasian and Keynesian attempts to formulate a consistent price and value theory.

Keywords: new framework of concepts, structure-centric, axiom set, structural value theorem, harmonic structure, zero profit condition, full employment, deflation, price vector, wage rate vector, Say’s law

JEL Classification: D40, D46, D51

Suggested Citation

Kakarot-Handtke, Egmont, The Structural Price Mechanism (October 10, 2013). Available at SSRN: https://ssrn.com/abstract=2338446 or http://dx.doi.org/10.2139/ssrn.2338446

Egmont Kakarot-Handtke (Contact Author)

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

Keplerstrasse 17
Stuttgart
Germany

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