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Keshav's avatar

I think this is spot on - pre-1945 economists did think about equilibrium as the limiting point of some causal process, but as equilibria began to be described using increasingly complicated mathematics, they gradually gave up on describing the adjustment process, partly because it became hard to do so with the same level of mathematical sophistication. The result is that modern economics absolutely does think in terms of equilibrium without describing any process which reaches an equilibrium state, except perhaps in a handwaving fashion. If you'll forgive the self-promotion I have a recent paper about the problems with this (which incidentally cites this 'stack on p30!), very much in the spirit of Fisher's book: https://www.newyorkfed.org/research/staff_reports/sr1093

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John Monz's avatar

The post leads me to recall an old book by MIT's Frank Fisher titled, "Disequilibrium Foundations of Equilibrium Economics." This was his attempt to apply the maths to the pths taken outside of equilibrium.

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