ABSTRACT
In this chapter, and the following Chapter 8, we recover and enlarge upon some neglected conceptions of competition in the work of the founding Austrians. It should be remarked at the outset that we shall not be presupposing a distinction between perfect competition and monopoly, or between perfect competition and imperfect competition, such as has been bequeathed to modern economists from late nineteenth-century Walrasian and Marshallian economics, and from Chamberlin and Robinson writing in the Marshallian tradition in the 1930s. Instead we take a position closer to each Austrian text which, as we shall demonstrate, neither adopted a rigid, formal taxonomy of market structures as if competition was a given state of affairs, nor analysed the properties of so-called competitive equilibrium states. The founding Austrians regarded competition as a highly personalized, faltering human process of rivalry and bargaining which had no substantially equivalent counterparts in the treatment of competition in the writings of leading contemporaries from other schools of thought, particularly, Jevons, Edgeworth, Walras and Marshall. By the close of Chapter 8 we should be in a position to demonstrate that when Hayek (1948) later expanded on the meaning of competition as a dynamic market process, whether conscious of the influence or not, his contribution acted as a conduit for the transmission to modern economists of some founding Austrian insights on the subject.
