The Law of Indi¤erence, Equilibrium, and Equilibration in Jevons, Walras, Edgeworth, and Negishi

In the glorious decade running from 1871 to 1881, Jevons, Walras, and Edgeworth laid the foundations of most modern microeconomic analysis: in his Theory of Political Economy (1 edition 1871, 2 edition 1879; henceforth TPE ), not only did Jevons formalise for the …rst time, by means of his celebrated "equations of exchange", the conditions de…ning the equilibrium of a pure-exchange two-commodity, two-trader economy, but he also opened up a line of thought that would lead, about one century later, to the emergence of a theory of decentralised exchange based on pairwise interactions (see, e.g., Kunimoto and Serrano, 2004); in a series of mémoires published in the mid1870s (1874, 1876a, 1876b, 1877a), as well as in the 1 edition of his Eléments d’économie politique pure (henceforth EEPP), appearing in two instalments in the same stretch of time (1874-77), Walras started o¤ a grand theoretical approach, subsequently named ’general equilibrium theory’, applying not only to exchange economies with an arbitrary number of markets and agents, but also to multi-market and multi-agent economies with production and capital formation; …nally, in his Mathematical Psychics (1881; henceforth MP), Edgeworth sealed the revolutionary decade 1871-1881 by initiating a tradition that would lead, about eighty years later, to the development of a theory of decentralised exchange based on multilateral interactions, a special branch of the broader approach known as ’coalitional game theory’. All the three founding fathers made use of at least one equilibrium concept in their respective theoretical systems, occasionally naming it "competitive