Equilibrium and efficiency
This chapter provides the late neoclassical trajectory of the concept of equilibrium as the harmonious reconciliation of the diverse interests of rational, autonomous, and self-transparent agents. The concept of equilibrium as the concept of harmonious reconciliation in economic theory is one of the two constitutive presuppositions of neoclassical humanism. In contrast to the general equilibrium concept that informs the Walrasian vision, the Marshallian vision focuses on particular markets and deploys a concept of partial equilibrium. It is well established that the early mathematical formalizations of the Arrow-Debreu (A-D) general equilibrium model were, in part, inspired by the generalization of the n-person equilibrium idea of Nash. In classical game theory, the economic problem in each game is to reach a unique Nash equilibrium and to assess the Pareto property of the equilibrium. In evolutionary game theory, the economic problem is to reach evolutionary stability.