Empirical rejection of mainstream economics' core postulates -on prices, firms' profits and markets structure.

Vergés-Jaime, Joaquim (2020): Empirical rejection of mainstream economics' core postulates -on prices, firms' profits and markets structure. Published in: Real-World Economics Review , Vol. -, No. no. 93 (28 September 2020): pp. 61-75.

Abstract

Mainstream economics relies largely on deductive assumptions –not resulting from a systematic gathering of observations. Among them, those assumptions on prices determination by firms, firms’ size relative to market demand, and the prevailing market structure regarding the competition/monopoly axis. The present paper is devoted to presenting the results of confronting these assumptions with the extensive empirical evidence about. As a result it is argued here that these core assumptions cannot actually be sustained; hence, the economics’ standard model built upon them is not a useful theory to explain the workings of market economies, teach economics at class rooms, etc.

• Item Type: MPRA Paper
• Language: English
• Keywords: Mainstream economics' assumptions, Firms' pricing, Empirical evidence on firms' profits, Empirical evidence on market structures
• Subjects: A - General Economics and Teaching > A2 - Economic Education and Teaching of Economics; B - History of Economic Thought, Methodology, and Heterodox Approaches > B4 - Economic Methodology > B41 - Economic Methodology; D - Microeconomics > D0 - General > D01 - Microeconomic Behavior: Underlying Principles; D - Microeconomics > D2 - Production and Organizations; D - Microeconomics > D4 - Market Structure, Pricing, and Design; D - Microeconomics > D5 - General Equilibrium and Disequilibrium

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