IDEAS home Printed from https://ideas.repec.org/a/aea/jecper/v10y1996i2p169-77.html
   My bibliography  Save this article

Retrospectives: The Origins of the Representative Agent

Author

Listed:
  • James E. Hartley

Abstract

This paper examines Alfred Marshall's invention of the representative firm. Marshall first used the representative firm in order to describe an industry supply curve for an industry with heterogeneous firms. Despite Marshall's limited use of the notion, the representative agent was extensively criticized as an ephemeral, useless construct that was unable to account for economic growth and that ignored important heterogeneities. The criticisms succeeded in banishing the representative agent from economics. These initial criticisms are also shown to apply to modern uses of the representative agent as well.

Suggested Citation

  • James E. Hartley, 1996. "Retrospectives: The Origins of the Representative Agent," Journal of Economic Perspectives, American Economic Association, vol. 10(2), pages 169-177, Spring.
    • Handle: RePEc:aea:jecper:v:10:y:1996:i:2:p:169-77
    Note: DOI: 10.1257/jep.10.2.169
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/jep.10.2.169
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mehra, Rajnish & Prescott, Edward C., 1985. "The equity premium: A puzzle," Journal of Monetary Economics, Elsevier, vol. 15(2), pages 145-161, March.
    2. Thomas Mayer, 1998. "Indexed Bonds And Heterogeneous Agents," Contemporary Economic Policy, Western Economic Association International, vol. 16(1), pages 77-84, January.
    3. Marshall, Alfred, 1920. "Industry and Trade," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, edition 3, number marshall1920.
    4. Alan P. Kirman, 1992. "Whom or What Does the Representative Individual Represent?," Journal of Economic Perspectives, American Economic Association, vol. 6(2), pages 117-136, Spring.
    5. Young, Allyn A., 1928. "Increasing Returns and Economic Progress," History of Economic Thought Articles, McMaster University Archive for the History of Economic Thought, vol. 38, pages 527-542.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Antonella Stirati, 2013. "Sraffa's 1930 manuscripts on the representative firm and Marshall's theory of value and business profit," The European Journal of the History of Economic Thought, Taylor & Francis Journals, vol. 20(3), pages 439-465, June.
    2. Aoki, Masanao & Hawkins, Raymond J., 2010. "Non-self-averaging and the statistical mechanics of endogenous macroeconomic fluctuations," Economic Modelling, Elsevier, vol. 27(6), pages 1543-1546, November.
    3. Aoki, Masanao & Hawkins, Raymond, 2009. "Macroeconomic Relaxation: Adjustment Processes of Hierarchical Economic Structures," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 3, pages 1-21.
    4. Holtfort, Thomas, 2023. "Quantenökonomie: Einfluss der Quantenphysik auf ökonomische Entscheidungsprozesse," Arbeitspapiere der FOM 88, FOM Hochschule für Oekonomie & Management.
    5. Herzberg, Frederik, 2010. "A representative individual from Arrovian aggregation of parametric individual utilities," Journal of Mathematical Economics, Elsevier, vol. 46(6), pages 1115-1124, November.
    6. Kazuo Sano, 2022. "Intelligence and Global Bias in the Stock Market," Papers 2210.16113, arXiv.org.
    7. Carlos Alberto Ibarra, 1998. "Exchange Rate Policy Credibility in Mexico, 1991-1994," Economía Mexicana NUEVA ÉPOCA, CIDE, División de Economía, vol. 0(2), pages 229-266, July-Dece.
    8. Michael Paetz, 2007. "Robust Control and Persistence in the New Keynesian Economy," Quantitative Macroeconomics Working Papers 20711, Hamburg University, Department of Economics.
    9. Becker, Robert & Zilcha, Itzhak, 1997. "Stationary Ramsey Equilibria under Uncertainty," Journal of Economic Theory, Elsevier, vol. 75(1), pages 122-140, July.
    10. Philippe Delquié, 2003. "Optimal Conflict in Preference Assessment," Management Science, INFORMS, vol. 49(1), pages 102-115, January.
    11. Thomas Holtfort & Andreas Horsch, 2023. "Social science goes quantum: explaining human decision-making, cognitive biases and Darwinian selection from a quantum perspective," Journal of Bioeconomics, Springer, vol. 25(2), pages 99-116, August.
    12. Kobbi Nissim & Rann Smorodinsky & Moshe Tennenholtz, 2018. "Segmentation, Incentives, and Privacy," Mathematics of Operations Research, INFORMS, vol. 43(4), pages 1252-1268, November.
    13. Alberto Jaramillo & Hermilson Velásquez & Javier Santiago Ortiz & Natalia Serna, 2003. "Aspectos teóricos y empíricos de la relación empresas bancos," Documentos de Trabajo de Valor Público 3922, Universidad EAFIT.
    14. Frank Schohl, 1998. "The Paradoxical Fate of the Representative Firm," Working Paper Series B 1998-03, Friedrich Schiller University of Jena, School of of Economics and Business Administration.
    15. Senbeta, Sisay, 2011. "How applicable are the new keynesian DSGE models to a typical low-income economy?," MPRA Paper 30931, University Library of Munich, Germany.
    16. Oscar Andrés Espinosa Acuna & Paola Andrea Vaca González, 2012. "La educación como motor de desarrollo integral: la importancia del capital humano en el crecimiento económico y social de largo plazo," Econógrafos, Escuela de Economía 9936, Universidad Nacional de Colombia, FCE, CID.
    17. Bos Iwan & Vermeulen Dries, 2022. "On the Microfoundation of Linear Oligopoly Demand," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 22(1), pages 1-15, January.
    18. Philipp Koellinger & Matthijs Loos & Patrick Groenen & A. Thurik & Fernando Rivadeneira & Frank Rooij & André Uitterlinden & Albert Hofman, 2010. "Genome-wide association studies in economics and entrepreneurship research: promises and limitations," Small Business Economics, Springer, vol. 35(1), pages 1-18, July.
    19. Tilfani, Oussama & Kristoufek, Ladislav & Ferreira, Paulo & El Boukfaoui, My Youssef, 2022. "Heterogeneity in economic relationships: Scale dependence through the multivariate fractal regression," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 588(C).
    20. van Oosterhout, J. & Heugens, P.P.M.A.R., 2006. "Much Ado About Nothing: A conceptual critique of CSR," ERIM Report Series Research in Management ERS-2006-040-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ait-Sahalia, Yacine & Lo, Andrew W., 2000. "Nonparametric risk management and implied risk aversion," Journal of Econometrics, Elsevier, vol. 94(1-2), pages 9-51.
    2. Michalis Nikiforos, 2013. "The (Normal) Rate of Capacity Utilization at the Firm Level," Metroeconomica, Wiley Blackwell, vol. 64(3), pages 513-538, July.
    3. David Simpson, 2013. "The Rediscovery of Classical Economics," Books, Edward Elgar Publishing, number 15080.
    4. John Foster, 2021. "The US consumption function: a new perspective," Journal of Evolutionary Economics, Springer, vol. 31(3), pages 773-798, July.
    5. Raphael A. Espinoza & Charles A. E. Goodhart & Dimitrios P. Tsomocos, 2006. "Endogenous State Prices, Liquidity, Default, and the Yield Curve," OFRC Working Papers Series 2006fe15, Oxford Financial Research Centre.
    6. Rasiah, Rajah, 2003. "Foreign ownership, technology and electronics exports from Malaysia and Thailand," Journal of Asian Economics, Elsevier, vol. 14(5), pages 785-811, October.
    7. Joan-Severo Chumbita, 2020. "Alfred Marshall, autor del siglo XX: desempleo involuntario, monopolio, amortización acelerada, competencia por nuevos productos e intervención estatal orientada a alcanzar el producto máximo," Ensayos de Economía 19130, Universidad Nacional de Colombia Sede Medellín.
    8. Frank Schohl, 1998. "The Paradoxical Fate of the Representative Firm," Working Paper Series B 1998-03, Friedrich Schiller University of Jena, School of of Economics and Business Administration.
    9. Haim Levy & Moshe Levy, 2021. "Prospect theory, constant relative risk aversion, and the investment horizon," PLOS ONE, Public Library of Science, vol. 16(4), pages 1-21, April.
    10. Rajah Rasiah & Jebamalai Vinanchiarachi, 2013. "Institutional Support and Technological Upgrading: Evidence from Dynamic Clusters in Latin America and Asia," World Economic Review, World Economics Association, vol. 2013(2), pages 1-24, February.
    11. S.M. Shafaeddin, 2004. "Who Is The Master? Who Is The Servant? Market Or Government? An Alternative Approach: Towards A Coordination System," UNCTAD Discussion Papers 175, United Nations Conference on Trade and Development.
    12. Aoki, Masanao & Hawkins, Raymond J., 2010. "Non-self-averaging and the statistical mechanics of endogenous macroeconomic fluctuations," Economic Modelling, Elsevier, vol. 27(6), pages 1543-1546, November.
    13. Erhan Bayraktar & Ulrich Horst & Ronnie Sircar, 2007. "Queueing Theoretic Approaches to Financial Price Fluctuations," Papers math/0703832, arXiv.org.
    14. Buss, Adrian, 2013. "Capital controls and international financial stability: a dynamic general equilibrium analysis in incomplete markets," Working Paper Series 1578, European Central Bank.
    15. Christiane Goodfellow & Dirk Schiereck & Steffen Wippler, 2013. "Are behavioural finance equity funds a superior investment? A note on fund performance and market efficiency," Journal of Asset Management, Palgrave Macmillan, vol. 14(2), pages 111-119, April.
    16. Lin Xie & Biliang Luo & Wenjing Zhong, 2021. "How Are Smallholder Farmers Involved in Digital Agriculture in Developing Countries: A Case Study from China," Land, MDPI, vol. 10(3), pages 1-16, March.
    17. Croce, M.M. & Nguyen, Thien T. & Raymond, S. & Schmid, L., 2019. "Government debt and the returns to innovation," Journal of Financial Economics, Elsevier, vol. 132(3), pages 205-225.
    18. Popoyan, Lilit & Napoletano, Mauro & Roventini, Andrea, 2017. "Taming macroeconomic instability: Monetary and macro-prudential policy interactions in an agent-based model," Journal of Economic Behavior & Organization, Elsevier, vol. 134(C), pages 117-140.
    19. Quah, Danny, 1994. "One business cycle and one trend from (many,) many disaggregates," European Economic Review, Elsevier, vol. 38(3-4), pages 605-614, April.
    20. Rhys Bidder & Ian Dew-Becker, 2016. "Long-Run Risk Is the Worst-Case Scenario," American Economic Review, American Economic Association, vol. 106(9), pages 2494-2527, September.

    More about this item

    JEL classification:

    • B13 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Neoclassical through 1925 (Austrian, Marshallian, Walrasian, Wicksellian)
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • B31 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals - - - Individuals
    • B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:jecper:v:10:y:1996:i:2:p:169-77. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.