Was It A “Fatal Error”? Sraffa and Samuelson on Marshall’s partial equilibria method
In this paper we reconstruct the evolution of Sraffa’s and Samuelson’s thought on Marshallian partial equilibrium analysis and evaluate the debate among Samuelson and scholars such as Eatwell, Garegnani, Panico and Kurz and Salvadori, who were interested in developing Sraffa’s contribution to the Classical theory of value and distribution, on this issue. We also use unpublished manuscripts by Sraffa, to which Samuelson did not have access during his lifetime. With respect to Samuelson’s critique of the first part of Sraffa’s (1926), much of the contrast is related to the fact that Samuelson underestimated Sraffa’s (1930) contribution to the Economic Journal Symposium on “Increasing Returns and the Representative Firm”, while his opponents underestimated the potential for misunderstandings which came from Sraffa’s 1926 wording and did not fully consider the analytical consequences of the fact that Sraffa significantly changed his attitude towards Marshallian partial equilibrium theory in 1927.
Area: Eshet Conference
Keywords: Samuelson; Sraffa; Marshall; partial equilibrium method
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