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A partial equilibrium is a type of economic equilibrium
Economic equilibrium

In economics, economic equilibrium is simply a state of the world where economic forces are balanced and in the absence of external influences the values of economic variables will not change....
, where the clearance on the market of some specific goods is obtained independently from prices and quantities demanded and supplied in other markets. In other words, the prices of all substitutes and complements, as well as income levels of consumers are constant. Here the dynamic process is that prices adjust until supply equals demand. It is a powerfully simple technique that allows one to study equilibrium
Economic equilibrium

In economics, economic equilibrium is simply a state of the world where economic forces are balanced and in the absence of external influences the values of economic variables will not change....
, efficiency
Pareto efficiency

Pareto efficiency, or Pareto optimality, is an important concept in economics with broad applications in game theory, engineering and the social sciences....
 and comparative statics
Comparative statics

In economics, comparative statics is the comparison of two different economic equilibrium states, before and after a change in some underlying exogenous parameter....
.








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Encyclopedia


A partial equilibrium is a type of economic equilibrium
Economic equilibrium

In economics, economic equilibrium is simply a state of the world where economic forces are balanced and in the absence of external influences the values of economic variables will not change....
, where the clearance on the market of some specific goods is obtained independently from prices and quantities demanded and supplied in other markets. In other words, the prices of all substitutes and complements, as well as income levels of consumers are constant. Here the dynamic process is that prices adjust until supply equals demand. It is a powerfully simple technique that allows one to study equilibrium
Economic equilibrium

In economics, economic equilibrium is simply a state of the world where economic forces are balanced and in the absence of external influences the values of economic variables will not change....
, efficiency
Pareto efficiency

Pareto efficiency, or Pareto optimality, is an important concept in economics with broad applications in game theory, engineering and the social sciences....
 and comparative statics
Comparative statics

In economics, comparative statics is the comparison of two different economic equilibrium states, before and after a change in some underlying exogenous parameter....
.

History


Léon Walras
Léon Walras

Marie-Esprit-L?on Walras was a French economics, considered by Joseph Schumpeter as "the greatest of all economists". He was a mathematical economics associated with the creation of the general equilibrium theory....
 first formalized the idea of a one-period economic equilibrium of the general economic system, but it was French economist Antoine Augustin Cournot and English political economist Alfred Marshall
Alfred Marshall

Alfred Marshall was an England economist and one of the most influential economists of his time. His book, Principles of Economics , brings the ideas of supply and demand, of marginal utility and of the costs of production into a coherent whole....
 who developed tractable models to analyze an economic system.

See also

  • Competitive equilibrium
    Competitive equilibrium

    Competitive market equilibrium is the traditional concept of economic equilibrium, appropriate for the analysis of commodity markets with flexible prices and many traders, and serving as the benchmark of efficiency in economic analysis....
  • Economics
    Economics

    File:Ballard Farmers' Market - vegetables.jpgEconomics is the Social sciences that studies the Production theory basics, Distribution , and Consumption of Good and Service ....
  • Equilibrium
    Equilibrium

    For the opposite, see disequilibrium.Equilibrium is the condition of a system in which competing influences are balanced and it may refer to:...
     (disambiguation page)
  • General equilibrium
    General equilibrium

    General equilibrium theory is a branch of theoretical economics. It seeks to explain the behavior of supply, demand and prices in a whole economy with several or many markets....
  • Pareto Efficiency
    Pareto efficiency

    Pareto efficiency, or Pareto optimality, is an important concept in economics with broad applications in game theory, engineering and the social sciences....
  • Welfare economics
    Welfare economics

    Welfare economics is a branch of economics that uses microeconomics techniques to simultaneously determine allocative efficiency within an economy and the income Distribution associated with it....


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