Price rigidity and market-clearing: a conceptual clarification

This article tests the view (derived from Hicks and Patinkin) that non-mark et clearance may be caused by slow adjustment ('process rigidity'). There a re-models where market-rationing is present and derives from some form of r igidity, but this rigidity cannot be considered as process rigidity. It is similarly possible to accommodate the idea of process rigidity within the M arshallian research programme. What is missing is that market-rationing mig ht be its corollary. The reason such a causal link is often believed to exi st lies in a generic use of the concept of rigidity, used to designate alte rnative and incompatible phenomena: 'exogenous end-state rigidity' and 'equ ilibrium end-state rigidity', as well as process rigidity. It is true that these first two forms of rigidity create market rationing. The belief that slow adjustment also generates market rationing results from the unwarrante d extension to process rigidity of conclusions which are only valid for the first two.