Let us designate the activities in the previous period as X−1 and the available amount of labour in the current period as N0. A time sequence of temporary equilibria which starts from the initial point (X−1N0), is examined in this chapter with respect to the following two points. The first is referred to by Walras as the problem of tatonnement, which is concerned with the problem of how temporary equilibrium whose existence is theoretically assured by the fixed point theorem is actually obtained (i.e., found and attained) in a market where free competition prevails. Economists, including Walras himself, usually call it the problem of the stability of the temporary equilibrium point. In fact, it examines whether the process of tatonnement starting from a point off the temporary equilibrium will converge to this last eventually.

The second is concerned with whether a time sequence of temporary equilibria initiating from a hypothetical initial position will converge to the original sequence from the historically given initial position (X−1, N0), where. In this problem, the stability of the equilibrium path (or movement) is investigated; if the motion settles, in the end, at a certain point, which may be called a long-run equilibrium point, the stability of motion is reduced to the stability of the long-run equilibrium point, as it was so in the case of Ricardo who believed the existence of a long run stationary state.