Monopolistic Competition and the Capital Market

This essay is related to two topics on which Joan Robinson1 made important contributions. The first is the theory of imperfect competition. At the time it was written, The Economics of Imperfect Competition was heralded (along with Chamberlin’s contemporaneous book The Theory of Monopolistic Competition2) as doing for microeconomics what Keynes had done for macroeconomics. But the revolution to which it was supposed to give rise never occurred, and it was almost forty years before the themes she developed there again became the focus of theoretical research.3