8 The Years of High Theory: II . The first signs of dissent Marshall’s theoretical system, perhaps precisely because of his wish to understand the real world and his attempt to link social evolutionism to the utilitarian ethic, ended up by assuming an ambiguous character and provoked a critical reaction. | 8 The Years of High Theory II . The Theory of Market Forms . The first signs of dissent Marshall s theoretical system perhaps precisely because of his wish to understand the real world and his attempt to link social evolutionism to the utilitarian ethic ended up by assuming an ambiguous character and provoked a critical reaction. This was due among other things to the vulgarized interpretations of Marshall as preached by his followers. The Principles besides being a great work of economics represents an impressive book of sociology of nineteenth-century English capitalism and is permeated by a deep sense of history. But Marshall s followers chose to develop only the analytical part of the book ignoring its cultural and philosophical background. This unfortunate gap between Marshall s intentions and those of his followers led to more than a few misunderstandings. At Cambridge where Marshall s influence was to last a long time the first signs of dissent had already appeared at the beginning of the 1920s. At the centre of these criticisms was the question of the compatibility between the hypothesis of perfect competition and the partial-equilibrium method. In the Principles Marshall had discussed the existence of different productive sectors characterized by decreasing constant and increasing costs. It follows that the long-run supply curve of the sector is not necessarily rising but may be horizontal or falling. Now it is impossible to establish a priori which of the three situations is most plausible or probable. It is a matter which must be ascertained case by case with reference to the specific type of sector under consideration. However it is possible to say in general that there is no law of long-run supply establishing a direct relationship between prices and quantity in the same way in which it is possible to speak albeit with reserve of a law of demand establishing an inverse relationship. In the long run and at the sector level there is no law of .
