More on Walras
5 January 2007 at 1:48 am Peter G. Klein 1 comment
| Peter Klein |
Regarding Walras and the development of mathematical economics, Don Lloyd sends along these quotes from The Origin of Wealth: Evolution, Complexity, and the Radical Remaking of Economics by Eric D. Beinhocker (HBS Press, 2006):
The young Walras had a very shaky start to his career, and there was little foreshadowing of his later greatness. As a student, he was twice rejected from the prestigious Ecole Polytechnique due to poor mathematical skills. He instead went to the Ecole des Mines but failed as an engineer, then tried his hand as a novelist but was unsuccessful at that as well. One evening in 1858, a depressed Walras took a walk with his father, a teacher and writer, discussing what he should do with his life. The elder Walras, a great admirer of science, said that were two great challenges remaining in the nineteenth century: the creation of a complete theory of history, and the creation of a scientific theory of economics. He believed that differential calculus could be applied to economics to create a “science of economic forces, analogous to the science of astronomical forces.” The younger Walras was inspired by his father’s vision of a scientific economics and decided to make achieving that vision his life’s work (p. 29).
[I]t was particularly from chapter two of [Poinsot’s Elements of Statics], titled “On conditions of equilibrium expressed by means of equations,” that Walras imported the concept of equilibrium from physics into economics and laid the foundation for the Traditional Economics found in textbooks and journals today. This historical detail is noteworthy, because, as we will see in the next chapter, some critics argue this borrowing of equilibrium from physics was a crucial scientific misstep that has had lasting consequences for the field (p. 31).
Entry filed under: - Klein -, Methods/Methodology/Theory of Science.
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Tom S. | 7 January 2007 at 1:57 am
Eric Beinhocker goes on to argues that the misstep was Walras did not include, because it had not been discovered yet, the second law of thermodynamics. Walras only based his equilibrium notion on the first law. Ultimately, Mr Beinhocker argues the fusion with physics is incomplete (only based on the first law of thermodynamics) and argues for adopting some more recent laws developed from physics, namely, the second law of thermodynamics.