If you need an accessible version of this item please contact JSTOR User Support

The LeChatelier Principle

Paul Milgrom and John Roberts
The American Economic Review
Vol. 86, No. 1 (Mar., 1996), pp. 173-179
Stable URL: http://www.jstor.org/stable/2118261
Page Count: 7
  • Download PDF
  • Cite this Item

You are not currently logged in.

Access your personal account or get JSTOR access through your library or other institution:

login

Log in to your personal account or through your institution.

If you need an accessible version of this item please contact JSTOR User Support
The LeChatelier Principle
Preview not available

Abstract

The LeChatelier principle, in the form introduced into economics by Paul A. Samuelson, asserts that at a point of long-run equilibrium, the derivative of long-run compensated demand with respect to own price is larger in magnitude than the derivative of short-run compensated demand. We introduce an extended LeChatelier principle that applies also to large price changes and to uncompensated demand as well as to a wide range of concave and nonconcave maximization problems outside the scope of demand theory. This extension also clarifies the intuitive basis of the principle.

Page Thumbnails

  • Thumbnail: Page 
173
    173
  • Thumbnail: Page 
174
    174
  • Thumbnail: Page 
175
    175
  • Thumbnail: Page 
176
    176
  • Thumbnail: Page 
177
    177
  • Thumbnail: Page 
178
    178
  • Thumbnail: Page 
179
    179