The Dorfman-Steiner condition and the mathematization of the theory of the firm

The Dorfman-Steiner condition is a classic result in the theory of the firm, formulated by Robert Dorfman and Peter Steiner in Citation1954. It characterises the optimal level of advertising budget chosen by a firm that can set both its price and advertising budget. In this paper, I revisit their article, first showing that this condition is only one among several derived by them. I then place the article within the broader history of the theory of the firm. Finally, I show that it must also be read in light of the contemporaneous debates over the role of algebra in economics.