Marshall’s Equilibrium Analysis and the ‘Reconciliation Problem’

In the previous chapter it was established that Marshall intended economic biology, the ‘Mecca of the economist’, to play a significant role in the analytical apparatus being constructed in his Principles. This was to represent a movement away from the ‘mechanical’ mode of thinking allied with the mathematical-physical sciences, an approach that Marshall associated with the work of many of his contemporaries and also with his own early unpublished essays on value. However, as was also noted in the previous chapter, Marshall warned his readers that a relatively large place was to be given to mechanical analogies in a volume on Economic Foundations. Marshall specifically cautioned against the idea that the term equilibrium should be associated with purely statical analysis, maintaining that the Principles was ‘concerned throughout with the forces that cause movement’ (Principles: xiv). This chapter outlines the nature and content of Marshall’s equilibrium analysis, and the attempt to ‘reconcile’ the mechanical analogies with the evolutionary modes of thought discussed in the previous chapter.