Léon Walras 101: The Father of General Equilibrium Theory

Marie-Esprit-Léon Walras was a French mathematical economist and Georgist who lived from 1834 to 1910. He is best known for his work on general equilibrium theory, which is a mathematical model of the economy that attempts to explain how prices and quantities are determined in all markets simultaneously.

Walras’s work was highly influential in the development of modern economics, and it continues to be studied and debated by economists today. If you are interested in learning more about him, keep reading this Zatrun.com article.

Who is Léon Walras?

Walras was born in Évreux, France, in 1834. His father, Auguste Walras, was a school administrator and a professor of mathematics. Léon Walras’s early interest in economics was likely inspired by his father, who was also an amateur economist.

Walras studied engineering at the École des Mines de Paris, but he soon realized that his true passion was economics. He left engineering school and began studying economics at the University of Geneva. After graduating from Geneva, Léon Walras moved to Lausanne, Switzerland, where he taught economics at the University of Lausanne for the rest of his life.

Walras’s most important work is his book Éléments d’économie politique pure (Elements of Pure Economics), which was first published in 1874. In Éléments, Walras developed a mathematical model of the economy that attempted to explain how prices and quantities are determined in all markets simultaneously.

Walras’s model

• There are many buyers and sellers in each market.
• Buyers and sellers are rational and have perfect information about prices.
• Buyers and sellers are free to enter and exit markets.
• Markets are perfectly competitive.

Under these assumptions, Walras showed that there is a unique set of prices and quantities that will bring the economy into equilibrium. This set of prices and quantities is called the general equilibrium.

Walras’s work on general equilibrium theory was highly influential in the development of modern economics. His work helped to lay the foundation for the neoclassical school of economics, which is the dominant school of economics today. Walras’s work is also still studied and debated by economists today, and it continues to be relevant to the study of the economy.

Here are some of Walras’s key contributions to economics:

• He developed a mathematical model of the economy that attempted to explain how prices and quantities are determined in all markets simultaneously.
• He is considered one of the founders of the neoclassical school of economics.
• His work is still studied and debated by economists today.

Walras’s work has had a profound impact on the way we think about the economy. His work is still relevant today, and it continues to be studied and debated by economists.