ABSTRACT
In Kuhnian terms, the classical economists shared a vision that was substantially different from the vision promoted by the neoclassical equilibrium paradigm. In particular, evidence suggesting a classical lineage for the concept of perfect competition is tenuous, at best; the perfectly competitive model should more aptly be characterized as a mutation, for its genes bear little resemblance to those of its presumed parents. Adam Smith’s ‘state of natural liberty’ was the free-entry nexus of advantage-seeking forces that cease to exist under the Walrasian vision. The nowfamiliar neoclassical idea of competition-the state of affairs
prevailing after the entire process of rivalry has run its courseemerged, like a phoenix, from Cournot’s long-ignored 1838 treatise on mathematical economics. It was resurrected by Walras to accommodate his mathematical model of general equilibrium. Modern comparative-statics reasoning-based on the idea of firms who react helplessly to given prices-was not the reflexive centrepiece of the classical tradition.
