Equilibrium

"[The notion of equilibrium] is a notion which can be employed usefully in varying degrees of looseness. It is an absolutely indispensable part of the toolbag of the economist and one which he can often contribute usefully to other sciences which are occasionally apt to get lost in the trackless exfoliations of purely dynamic systems."

"Equilibrium is a figment of the human imagination."

"The equilibrium model describes systems which, in moving to an equilibrium point, typically lose organization, and then tend to hold that minimum level within relatively narrow conditions of disturbance."

"In Deutsch's view, to say that a social system is in equilibrium implies that: 1) it will return to a particular state when disturbed; 2) the disturbance is coming from outside the system; 3) the greater the disturbance the greater the force with which the system will return to its original state; 4) the speed of the system's reaction to disturbance is somehow less relevant — a sort of friction, or blemish having no place in the "ideal" equilibrium; 5) no catastrophe can happen within the system."

"The equilibrium between supply and demand is achieved only through a reaction against the upsetting of the equilibrium."

"I remember Robbins asking me if I could turn the Hayek model into mathematics... it began to dawn on me that... the model must be better specified. It was claimed that, if there were no monetary disturbance, the system would remain in 'equilibrium'. What could such an equilibrium mean? This, as it turned out, was a very deep question; I could do no more, in 1932, than make a start at answering it. I began by looking at what had been said by... Pareto and Wicksell. Their equilibrium was a static equilibrium, in which neither prices nor outputs were changing... That, clearly, would not do for Hayek. His 'equilibrium' must be progressive equilibrium, in which real wages, in particular, would be rising, so relative prices could not remain unchange … The next step in my thinking, was … equilibrium with perfect foresight. Investment of capital, to yield its fruit in the future, must be based on expectations, of opportunities in the future. When I put this to Hayek, he told me that this was indeed the direction in which he had been thinking. Hayek gave me a copy of a paper on 'intertemporal equilibrium', which he had written some years before his arrival in London; the conditions for a perfect foresight equilibrium were there set out in a very sophisticated manner."

"To dispose a soul to action we must upset its equilibrium."

"Good and evil grow up together and are bound in an equilibrium that cannot be sundered. The most we can do is try to tilt the equilibrium toward the good."

"Maxwell... during the 1860s... showed that when the velocities reached the bell-shaped distribution, no further net change was likely. (...Ludwig Boltzmann further elaborated... and strengthened Maxwell's results). Any specific molecule would speed up or slow down, but... other molecules would change in speed to compensate. When a gas reached that state... the gas was at equilibrium. ...[T]his notion of equilibrium is precisely analogous to the Nash equilibrium in game theory. ...[J]ust as the Nash equilibrium is typically a mixed set of strategies, a gas seeks an equilibrium state with a mixed distribution of molecular velocities."

"It cannot but happen that those individuals whose functions are most out of equilibrium with the modified aggregate of external forces, will be those to die; and that those will survive whose functions happen to be most nearly in equilibrium with the modified aggregate of external forces. But this survival of the fittest, implies multiplication of the fittest. Out of the fittest thus multiplied, there will, as before, be an overthrowing of the moving equilibrium wherever it presents the least opposing force to the new incident force."

"Economic theory is devoted to the study of equilibrium positions. The concept of equilibrium is very useful. It allows us to focus on the final outcome rather than the process that leads up to it. But the concept is also very deceptive. It has the aura of something empirical: since the adjustment process is supposed to lead to an equilibrium, an equilibrium position seems somehow implicit in our observations. That is not true. Equilibrium itself has rarely been observed in real life — market prices have a notorious habit of fluctuating."