BARONE, ENRICO

born Dec. 22, 1859, Naples died May 14, 1924, Rome Italian mathematical economist who expanded on the ideas of economist Lon Walras regarding general equilibrium theory. Barone spent much of his life as an army officer, only resigning from the army in 1907 after obtaining a professorship at the University of Rome. His main contributions, however, were largely made before that date. Walras proposed a mathematical model which demonstrated that products and prices automatically adjust in equilibrium. Barone further developed the general equilibrium structure of Walras to include variable combinations of inputs in production. Barone also worked on the marginal productivity theory of distribution independently of British economist Philip Wicksteed. However, he was persuaded by Vilfredo Pareto, the Italian economist and sociologist, that his approach to distribution was invalid. One of his most important contributions to economic theory was his demonstration that a collectivist economy could plan production rationally, thereby achieving economic equilibrium (comparable to the equilibrium theory of a competitive economy developed by Walras). He believed he had solved the problems of attainment of equilibrium, at least in principle, by the introduction of the concept of a trial-and-error process to achieve correct prices. Barone also contributed to international-trade theory.