Blog-Reference
You write: “This conclusion is based on two common erroneous statements. First, Walras’ general equilibrium theory is identified with Pareto’s general equilibrium theory; ...”
Pareto has not been mentioned at all in this thread until your recent post. Hence no conclusion has been based on Pareto.
Anyway. Let us take the opportunity and do away with Pareto. He obviously was a subjectivist: “The foundation of political economy and, in general, of every social science, is evidently psychology. A day will come when we shall be able to deduce the laws of social science from the principles of psychology ...” (Pareto, 2014, p. 20)
Subjectivists cling to the naive idea that the understanding of human behavior somehow leads to an understanding of how the economic system works. Since Pareto, Walras, Jevons, Marshall, Menger, et al. we have sufficient experience with this approach. And it is pretty obvious that it has failed completely.
Psychologism/sociologism inverts the Midas touch of science — to turn whatever it might touch into knowledge — into a curse: it turns everything it touches into the garbage.
So let us paraphrase Pareto: “The foundation of theoretical economics is evidently different from every social science. A day will come when we shall be able to deduce the laws of economics from the objective principles that constitute the economic system, that is, from a handful of elementary structural axioms.”#1
Egmont Kakarot-Handtke
References
Pareto, V. (2014). Manual of Political Economy. Oxford: Oxford University Press. URL
#1 For a start see the Curriculum of Constructive Heterodoxy aka Macrofoundations
