ABSTRACT
This chapter argues market order and imperfect competition to provide the starting points for determining theoretical and statistical norms for a developing economy. The various influences on theoretical normal prices in a developing economy are then brought together in an adaptation of the Sraffian system of reproduction prices. The chapter considers formal modelling of differential firm growth for the purpose of demonstrating the potential, as well as the limitations, of applying evolutionary analysis to determining norms for a developing economy. Development alters the norms applying at the transition between business cycles when one cluster of innovations has been widely diffused through the economy and another is yet to begin. When a cluster of innovations associated with a technological breakthrough creates a range of new industries, the timing of the cycle in firm heterogeneity within the affected industries is related to the timing of Schumpeter's Kondratieff cycles. The chapter concludes by pointing to implications for reconstructing Schumpeter's price theory.
