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Intertemporal equilibrium

Intertemporal equilibrium is the assertion that the economy at any one time is in disequilibrium, and that it is only when looking at it over the long term that it is in equilibrium.

This is a central tenet of the Austrian School, who maintain that the genius of the free market is not that it perfectly matches supply and demand, but that it encourages innovation to best meet that supply and demand.

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