The Hayek Hypothesis and Long‐Run Competitive Equilibrium
An Experimental Investigation
Bibliographic Data
| ID | 9703330 |
|---|---|
| Authors | Jason Shachat (0000-0002-9719-4555, Durham University Business School), Zhenxuan Zhang (Zhengzhou Central Sub‐Branch of The People’s Bank of China) |
| Year | 2017 |
| Volume | 127 |
| Issue | 599 |
| Pages | 199-228 |
| Publication date | 2017-02-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Economic Journal (JOURNAL) |
| Journal identifiers | ISSN: 0013-0133 • E-ISSN: 1468-0297 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.1111/ecoj.12249 |
| OpenAlex | W2152837682 |
| Language | EN |
| References cited | 21 |
We report on an experiment investigating whether the Hayek Hypothesis (Smith, 1982) extends to the long run setting. We consider two environments; one with a production technology having a U-shaped long run average cost curve and a single competitive equilibrium, and another with a constant long run average cost curve. We present alternative efficient production plans as a menu of fixed and marginal cost pairs. In both environments, we observe convergence to long run competitive equilibrium prices and quantities typically within six long run decision horizons
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| Citation velocity | historical |
|---|---|
| Highly cited | No |