Economic theory states that under competitive markets, economic profits are zero (even though accounting profits are not zero). What is the origin of this analysis? Who was the first author to write about this? Who was the first to put this into mathematics? I don't know how to search for this. I know Alfred Marshall is an important economist, who wrote a widely used book, but I do not have access to it. Is it him?

Any references are most welcomed.


The book from Alfred Marshall you are talking about is "Principles of Economics"

Principles of Economics PDF

As much I know the idea for Economic Surplus (Consumer Surplus and Producer Surplus) originated from Alfred Marshall, he is considered the person who "put" mathematics in the Economics theory.

  • $\begingroup$ Thanks for sharing the book. But is he the one that put forward this framework? If not, do you know who was? $\endgroup$
    – user928172
    Nov 9 '17 at 12:07
  • $\begingroup$ "In the mid-19th century, engineer Jules Dupuit first propounded the concept of economic surplus, but it was the economist Alfred Marshall who gave the concept its fame in the stream of economics." This is from Wikipedia, there is no link for the source, and I never did research on the topic, and can not give you more reliable source. $\endgroup$
    – user15100
    Nov 9 '17 at 13:37
  • $\begingroup$ Thanks. I will take a look. I am refering to the distingtion between economic and accounting profits, but maybe the surplus is what I am looking for. $\endgroup$
    – user928172
    Nov 9 '17 at 13:39
  • $\begingroup$ Economic Surplus does not have anything in common with accounting profit. The economics theory states that the customers will buy given product until the Economic Surplus becomes 0, the same is for the seller they will sell until the Economic surplus becomes 0. Economic surplus is the difference between Maximum price you are willing to pay, and the price you paid (Consumer), and is the difference between the selling price, and the minimum price you are willing to sell for (producer). $\endgroup$
    – user15100
    Nov 9 '17 at 13:50
  • $\begingroup$ Yes, but I never mentioned Surplus in my question. It was you who brought this into the discussion in the answer. That's why I am asking for the connection. $\endgroup$
    – user928172
    Nov 9 '17 at 20:03

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