Theoretic Models: Mathematical Form and Economic Content

Abstract

The steady course on which mathematical economics has held for the past four decades sharply contrasts with its progress during the preceding century, which was marked by several major scientific accidents. One of them occurred in 1838, at the beginning of that period, with the publication of Augustin Cournot’s Recherches sur les Principes Mathématiques de la Théorie des Richesses. By its mathematical form and by its economic content, his book stands in splendid isolation in time; and in explaining its date historians of economic analysis in the first half of the nineteenth century must use a wide confidence interval.

This chapter is a revised version of the Frisch Memorial Lecture delivered at the Fifth World Congress of the Econometric Society held at MIT, 17–24 August 1985, published in Econometrica, 54 (6): 1259–70. Permission to use is acknowledged.

I thank Irma Adelman, George and Helen Break, Jean-Michel Grandmont, Birgit Grodal, Werner Hildenbrand, Alan Manne, Andreu Mas-Colell, Herbert Scarf, John Shoven, George Stigler, Karl Vind, and Jean Waelbroeck for many helpful comments. The support of the National Science Foundation is also gratefully acknowledged.