Re: (OPE-L) Say's Law in Marxian Theories?

From: clyder@GN.APC.ORG
Date: Tue Mar 02 2004 - 19:05:27 EST

Quoting "A.B.Trigg" <A.B.Trigg@OPEN.AC.UK>:

> Paul.
> I don't argue that supply creates its own demand at the macro level. The
> problem at the macro level is that investment increases capacity but does not
> automatically create sufficient demand to establish balanced growth (this at
> least is the Domar interpretation of Marx's reproduction schemes). However,
> whilst Say's Law would assume this problem away, if it were to hold, I think
> it may also assume away the problem of disproportionality: since supply and
> demand are perfectly matched if the departments of production are in balance.
> Does this make any sense?
> Andrew.
Yes basically it does make sense.

The reality of course is that suppliers in dept 1 do not know what
the demand for their product in dept 2 will be in a dynamic situation
so supply and demand are not in balance.

>       -----Original Message-----
>       From: paul cockshott [mailto:clyder@GN.APC.ORG]
>       Sent: Tue 02/03/2004 10:53
>       Cc:
>       Subject: Re: (OPE-L) Say's Law in Marxian Theories?
>       I take it you are not supporting the idea that supply
>       creates its own demand at the macro level?
>       -----Original Message-----
>       From: OPE-L [mailto:OPE-L@SUS.CSUCHICO.EDU] On Behalf Of ajit sinha
>       Sent: 02 March 2004 07:35
>       Subject: Re: (OPE-L) Say's Law in Marxian Theories?
>       Ajit.
>       Can you explain a little more about
>       disproportionality? It could be
>       argued that proportionality between the departments of
>       production requires
>       that they are in balance: that supply and demand are
>       equal. If supply
>       creates its own demand (Say's Law), then this means
>       there cannot be
>       disproportionality. I agree that general
>       overproduction is distinct from
>       this, however.
>       Andrew.
>       _________________
>       Supply does not have to create a demand of equal
>       amount of its own kind. Say's law is more of a macro
>       level proposition. It only opposes a theoretical
>       possibility of a general glut. Cheers, ajit sinha
>       __________________________________
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