HoPE notes: June 7 I

Marginal Revolution, Medema
Mill's textbook was used as a textbook also at the higher level well into the 20th century.
1870 starts to professionalize economics into an academic field, top journals are started [insert years] and academic programs. This includes the move from 'political economy' to 'economic science'.
Roots and Antecedents:
* Cournot in 1838 is ~the first to introduce calculus-based analysis. Rather than starting with perfect competition and then doing monopoly as in a standard micro course, Cournot started by describing equilibrium in monopoly (MR = MC), and then adding firms one by one. 
* Von Thunen: marginal productivity theory (VMP = MFC)
* Gossen: laws, 1: diminishing marginal utility (also in Ricardo and others), 2: equating MU across goods, 
These all had basically zero interest. E.g. Cournot was hard to understand because of the math. 
Jevons: educated at UCL, economist, logician, statistician. He's the person who rediscovered Cantillon. He used utility theory in a different way then before. People previously used utilitarianism to think about ethics, but the concept of utility was not used to describe the individual choice in the modern way. Mill said that there was nothing more to say about value, Jevons didn't like Mill and commented on this and this work can be seen as a response to this. 
One important note: in this time they thought they might be close to actually being able to measure this. E.g. there are reference around the time of a 'utilimeter', they thought there might actually be a way to measure this using some machine. Their conception of utility was more real than the way we use it today. There's a reason why cardinal utility theory was developed before ordinal utility theory. This may be one of the reasons why people have this (currently) 'wrong' conception of it, because the critique would be right of applied to the original idea.
[where does revealed preference get introduced? this I guess becomes kind of a reinterpretation of existing utility theory in this case?]
Walras
Elements of Pure Economics, took abstract formalism to unseen heights. This presented a clear break with previous work. Takes a general equilibrium approach: to capture the interdependency of markets he described them through a system of simultaneous equations. Combined: input markets clear, output markets clear, zero profit condition (not actually no profit, but equal profits across sectors that compensate for the time value of money?). Note: he's not dealing with aggregates at all, so not like macro. Nobody understood the math, the work basically disappeared until the 1940s.
Marshall
[Medema notes that articles only became the real way of publishing post WWII, and even more from the 1970s]
Marshall played a huge role in the professionalization of economics. The first supply and demand diagrams show up in his 1871 book. His work was highly mathematical, but in the book he mostly just wrote in words and relegated math to the footnotes. Strong contrast with Walras. Marshall saw himself as continuing the same tradition as the classical economists, which is quite different from Jevons who saw a clean break from the classical insights. He doesn't put utility theory central, neither does he spend time on consumer theory. The whole book is at the market level, he look at market level supply and demand dynamics. For him partial equilibrium is much more interesting, he applauds Walras for developing general equilibrium, but doesn't see it as incredibly useful. There are mentions of different sensitivities to price for different goods, but Marshall for the first time develops the concept of elasticity and its mathematical form. He borrows from Dupuit the concepts of consumer and producer surplus and transforms them into a concept of welfare analysis, the first real sophisticated welfare analysis. He introduces the concepts of short run and long run, he had another time period called the 'market period' where supply is completely fixed, so that only demand determines price. 
After his death, there was the realization that if average cost is decreasing (returns to scale), the competitive model blows up. Joan Robinson: imperfect competition. Chamberlain coined the term monopolistic competition.