Market Adjustment

67 MARKET ADJUSTMENT AND IMPERFECT COMPETITION: ENTREPRENEURIAL RESPONSES TO equaliser AND DISEQUILIBRIUM IN MARKETS FOR HETEROGENEOUS GOODS Andrew Foshee, McNeese State University Will C. Heath, University of Louisiana at Lafayette Mihajlo Balic, McNeese State University ABSTRACT The present paper applies a market-clearing depth psychology to the neoclassical model of progressive tense competition in which firms may produce differentiated convergences, and for which long run symmetry is depict as ATC = P > MC. Most textbooks describe the disequilibrating impact of product differentiation, and the eventual return to long run market equilibrium, in terms of comparative statics, with little or no backchat of the adjustment wreak and the role of entrepreneurship in that process. This paper models the process of market adjustment in imperfectly competitive markets by incorporating a product-differentiating or Schumpeterian view of entrepreneurs who create changes to which price-adjusting entrepreneurs may respond. This paper describes the process by which entrepreneurs move imperfectly competitive markets from equilibrium to disequilibrium, and eventually to a new long run equilibrium. To that repeal it employs the graphic tools of neoclassical political economy.

INTRODUCTION Undergraduate courses in economics rarely provide more than superficial mention of entrepreneurial responses in explaining the market-clearing process. Journal of Economics and Economic Education interrogation, sight 11, Number 1, 2010 68 Brief references to entrepreneurs making price changes are sometimes incorporated in textbook chapters presenting the supply and demand model, and approximately no references are to be found in discussions of imperfect competition to the role of entrepreneurs in coordinating market activity. Research previously published in this journal (Foshee, Heath, and Balic, 2003) has provided a profitable methodology for explaining the important role entrepreneurs play in the market-clearing... If you destiny to get a full essay, order it on our website: Orderessay

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