ABSTRACT
Consider the state of economic theory even as late as on the eve of the Second World War. By and large, it was the domain of peaceful-looking geometrical curves, representing either indifference surfaces or technical transformation possibilities; first-or second-order derivatives of the tricks of calculus contributed their mite, and occasional footnotes acted as conductors of esoteric knowledge. In the lecture rooms, marginalism and perfect competition held sway. Since both Joan Robinson and E.H.Chamberlin had already produced their tracts, it would have been singular bad manners not to set aside a certain number of sessions to discuss imperfect market structures. The students were therefore told, in harum-scarum fashion, of those freak cases where the conditions of perfect knowledge, perfect mobility, infinite number of sellers, infinite number of buyers, et al., failed to obtain, and where market forces accordingly came to rest at a point different from the arcadia defined as perfect competition. Following this somewhat breathless narration, the students were hustled out of the classroom and into the examination hall.
