Microeconomics,, 16th Canadian Edition

shift the demand or supply curves and lead to different
equilibrium values for price and quantity.
6. The axis reversal arose in the following way. Alfred Marshall
(1842–1924) theorized in terms of “demand price” and “supply
price,” which were the prices that would lead to a given quantity
being demanded or supplied. Thus,

and the condition of equilibrium is

When graphing the behavioural relationships expressed in

Equations 6.1 and 6.2 , Marshall naturally put the independent

variable, Q, on the horizontal axis.

Leon Walras (1834–1910), whose formulation of the working of a

competitive market has become the accepted one, focused on

quantity demanded and quantity supplied at a given price. Thus,

and the condition of equilibrium is

pD=d(Q)

[6.1]

pS=s(Q)

[6.2]

d(Q)=s(Q)

 

QD = d(p)

QS = s(p)