1 - Making Economic Relationships Dynamic

Summary

‘Economics studies certain processes instead of making an inventory of wealth’. This youthful statement says much about Del Vecchio's conception of the role that economics must play as a social science. Firstly, economics studies processes, conceived as a set of relationships among agents which changes or evolves over time. Hence economic change lies at the centre of this representation, as Del Vecchio himself had warned with his constant references to the need to include a dynamic perspective in economic analysis. Time is an obligatory dimension of economics, and Del Vecchio's time was irreversible, not mechanical, time. This view can be condensed by labelling it ‘economic becoming’, where the focus is on the flows instead of stocks. Then, given his interest in general economic equilibrium, Del Vecchio immediately dealt with the difficulty of producing a general scheme which included time. To be noted is that Walras's general equilibrium, with which Del Vecchio's theoretical proposal was connected, was timeless.

But time is not only the legacy of the past. Time implies a forward-looking perspective that calls forecasts and expectations into question. Therefore, subjective choices become crucial for the working of the entire economic system, especially because choices are taken with uncertainty. Moreover, the fact that Del Vecchio depicted the economic capitalism of the time as intrinsically unstable can be read as a consequence of such uncertainty.