Introduction

Concepts of equilibrium and disequilibrium have long been involved in controversies over alternative macroeconomic theories. The debate on these issues has been rendered largely sterile because of confusion between the different meanings of these terms, which are often not even explicitly defined. In the present discussion, for instance, we may observe that what Keynes calls under-employment equilibrium is interpreted as disequilibrium by Lucas, whereas if we adopt the Keynesian meaning of equilibrium Lucas's ‘equilibrium business cycle’ necessarily implies the introduction of a dynamic mechanism operating in disequilibrium (see chapters 8, 9 and 13). As this example shows, there can be no serious and constructive debate among different trends in economic theory until the different meanings of the concept of equilibrium are defined clearly and precisely and the reciprocal relations are understood in sufficient depth.

We will try to introduce some order into this question by distinguishing three basic concepts of equilibrium: the syntactic (or logical) concept, briefly discussed in section 2.2, the dynamic concept analysed in section 2.3, and the family of specific semantic concepts considered in section 2.4. In section 2.5 I will briefly survey a few basic reasons underlying the importance of equilibrium analysis. Then, in section 2.6 I shall discuss the relativity of the distinction between equilibrium and disequilibrium. Although this distinction is theory-dependent and model-dependent we cannot renounce the analysis of both equilibrium and disequilibrium states without impoverishing and distorting the semantic implications of the model.