Market Theory and the Price System. Israel M. Kirzner
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THE COLLECTED WORKS OF ISRAEL M. KIRZNER
The Economic Point of View
Market Theory and the Price System
Essays on Capital and Interest
Competition and Entrepreneurship
Austrian Subjectivism and the Emergence of Entrepreneurship Theory
The Essence of Entrepreneurship and the Nature and Significance of Market Process
Competition, Economic Planning, and the Knowledge Problem
Discovery, Capitalism, and Distributive Justice
Reflections on Ethics, Freedom, Welfare Economics, Policy, and the Legacy of Austrian Economics
Ludwig von Mises: The Man and His Economics
This book is published by Liberty Fund, Inc., a foundation established to encourage study of the ideal of a society of free and responsible individuals.
The cuneiform inscription that serves as our logo and as a design element in Liberty Fund books is the earliest-known written appearance of the word “freedom” (amagi), or “liberty.” It is taken from a clay document written about 2300 B.C. in the Sumerian city-state of Lagash.
Introduction and index © 2011 by Liberty Fund, Inc.
Market Theory and the Price System was first published by D. Van Nostrand in 1963.
This eBook edition published in 2013.
eBook ISBNs:
978-1-61487-625-0
978-1-61487-252-8
B’EZRAS HASHEM
To Ludwig von Mises
CONTENTS
Introduction to the Liberty Fund Edition by Peter J. Boettke and Frédéric Sautet
1. THE NATURE AND TASKS OF MARKET THEORY
The Individual and the Market / The Market System / The Foundations of Market Theory / The Individual and Economic Behavior / Economic Theory and Economic Reality / Market Theory, Economic Theory, and Economics / Summary
2. THE MARKET: ITS STRUCTURE AND OPERATION
The Conditions Under Which the Market Operates / Market Roles / The Structure of the Market System: Vertical Relationships / The Structure of the Market System: Horizontal Relationships / The Analysis of Human Action in the Market: The Concept of Equilibrium / Complete and Incomplete Equilibrium / The Pattern of Market Adjustment / The Changing Market / The Market System as a Whole / Summary
3. EFFICIENCY, COORDINATION, AND THE MARKET ECONOMY
The Economic Problem / Society and the Economic Problem / The Problem of Coordination / How the Market Solves the Problems of Coordination / The Coordinating Function of Profits in a Market Economy / Summary
The Scale of Values / Marginal Utility / Diminishing Marginal Utility / The Marginal Utilities of Related Goods / Marginal Utility—Some Further Remarks / Marginal Utility and the Conditions for Exchange / Summary
Marginal Utility and the Allocation of Income / The Position of Consumer’s Equilibrium / A Geometrical Illustration / The Effects of Changes / The Individual Demand Curve / Some Remarks on Expectations / Summary
Market Demand / The Market Demand Curve / Demand Elasticity / Measures of Elasticity / Market Demand as Seen by the Individual Entrepreneur / Demand and Revenue / Demand and the Prices of Other Goods / Demand as a Market Force / Summary
7. MARKET PROCESS IN A PURE EXCHANGE ECONOMY
The Nature of Competition / A Simple Case of Price Competition / Simple Price Competition Without Perfect Knowledge / The Market for Several Non-Producible Goods: The Problem / The Equilibrium Situation for the Multi-Commodity Market / The Multi-Commodity Market Without Perfect Knowledge / Monopoly in a Pure Exchange Market / The Agitation of the Market / Summary / Appendix
The Economic Aspect of Production / Production by the Isolated Individual / Production in Society / Production in the Market Economy / Factors of Production / Production Functions and Isoquants / The Shape of the Isoquant and the Substitutability of Factors / Changes in Factor Proportions, and Changes in the Scale of Factor Employment / Returns to Scale / The Laws of Variable Proportions: The Problem / The Laws of Variable Proportions / Economic Implications of the Laws of Variable Proportions / The Least-Cost Combination / Graphic Illustration of the Least-Cost Combination / Summary
Costs and Rents / Opportunity Costs and Supply Theory / Prospective and Retrospective Costs / Capital Goods and Cost Theory / Factor Divisibility and Short-Run Per-Unit Costs / Short-Run Costs and Their Effect on Supply / Long-Run Costs and Supply / Factor Prices and Supply / Summary
10. PARTIAL MARKET PROCESSES—THE DETERMINATION OF PRODUCT PRICES AND FACTOR PRICES
The Market for a Single Product
Long-Run Equilibrium / Short-Run Equilibrium in the Single-Product Market / Equilibrium in the Single-Product Market in the Very Short Run / Adjustment to Change in a Market for a Single Product / The Market Process in a Market for a Single Product
The Market for a Single Factor of Production
Equilibrium in a Factor Market / The Market Process in a Market for a Single Factor of Production