Pricing
For neoclassical economic theory, price is all. The central theory of
pricing determines, at the same time, all equilibrium prices and outputs
and distributions in the economy. The theory of what determines price is
also the theory of what determines output and what determines
distribution. Everything is determined by the same theory, for which the
central tenets are that of maximising economic agents engaged in
behaviour which, under certain conditions, ensures that optimal prices
and outputs - in fact optimal outcomes throughout the economy - pertain.
Prices have a central role and are seen as scarcity indexes, allocating
resources between unlimited wants5. It is because of this function that
unfettered markets, which allow prices to be determined naturally, are
seen as the optimal way of allocating resources; and hence provide the
theoretical underpinnings of neoliberalism.