The Disproof of Neoclassical Theory by Means of Its Own Means
10 Pages Posted: 18 Dec 2020
Date Written: December 9, 2020
My research so far, which reveals fundamental mistakes of the conventional (neoclassical) economic theory, is based mainly on the (wrong) perception of this theory for the price taking and the horizontal demand curve for the firm, using instead the correct individual demand curve for the firm, which is sloping and equal to the total demand divided by the number of firms for each price. Despite the great readability and vivid academic interest that my relevant papers have caused, I feel some difficulties regarding the acceptance of the revised theory and perhaps even its understanding, due to physiological addiction and adherence to traditional theory and methodology. This article, however, demonstrates these mistakes of conventional theory by using the methodology of the conventional theory itself, without getting involved in the controversial issue of the horizontal or sloping demand curve for the firm.
Keywords: mistakes in equilibrium at market level, aggregate industry profit maximization, number of firms in perfect competition, supply curve, monopolistic nature of perfect competition, social welfare
JEL Classification: B12, B13, B21, D21, D41, D42, D43, D46, D50, D60, E10, E13, E30
Suggested Citation: Suggested Citation