He in his book, general theory, has severally criticized the say s law on the following grounds. Classical economists and says law of market youtube. The says law of markets is an economic rule that says that production is the source of demand. According to keynes, the classical theory based on say s law is unreal.
An important element of classical economics is says law of markets, after j. It would not be wrong to say that the entire thesis of says law is built upon unrealistic assumptions like flexibility of prices, wages, interest, rates, perfect competition, wide extent of the market, consumers sovereignty, etc. According to say s law, when an individual produces a product or service, he. These assumptions are very difficult to realize in actual practice. Says law of markets is the core of classical theory of employment. Classical economists and says law of market ecoholics largest platform for economics. So say s law is used against those who want to give an economy a boost via unproductive consumption.
Read this article to learn about the says law of market in economics. Keynes himself in his biographical essay on malthus and in the general theory claimed malthus as a precursor, while the literature that seeks to rehabilitate says law in the wake of. In currency valuation, greshams law was originally based on. Greshams law is a monetary principle stating that bad money drives out good. Say was finally falsified and laid to rest with the writings of lord j. Consumption destroys wealth, in contrast to production which is the source of economic growth, according to say s law. Assumptions of says law of market in classical theory of.
1430 1137 346 1493 437 269 421 503 485 311 138 737 1343 1146 496 666 1293 1068 296 1000 198 916 1056 1060 872 24 1025 147 1140 38 1246 20 662 1252 778