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Showing papers by "Gary S. Becker published in 1963"


Journal ArticleDOI
TL;DR: In a recent article, this article argued that many important results of current economic theory do not really depend on rational individual behavior; in particular, market demand curves would be negatively inclined not only when households maximize utility but also when they choose impulsively or follow habit.
Abstract: IN A recent article I argued that many important results of current economic theory do not really depend on rational individual behavior;' in particular, market demand curves would be negatively inclined not only when households maximize utility but also when they choose impulsively or follow habit. I also argued that instead of depending on rationality, these results depend on a general principle related to opportunity sets that includes both rational and irrational behavior. Professor Kirzner in his comment in the August issue apparently accepts what I claim to have demonstrated,2 but he vigorously denies that my analysis could be applied to the stability of competitive markets. He presents a lengthy demonstration along traditional lines that the equilibrium position in a single competitive market would be stable if both suppliers and demanders were rational. He readily concedes-a bit too readily-that, since market demand curves were shown to be negatively inclined and supply curves positively inclined even when behavior units were irrational, a single market would still be stable when suppliers (or demanders) alone were irrational. He asserts, however, that the equilibrium would not be stable if all participants were irra-

28 citations