Say’s Law versus Keynesian Economics
14th February 2020
Say’s Law, as explicated by the great liberal political economist Jean-Baptiste Say (1767-1832), is the principle that supply constitutes demand, with the corollary that aggregate supply always equals aggregate demand. There’s no more important principle in political economy to get perfectly right – and assiduously avoid getting wrong – than Say’s Law.
Innovation always comes from the supply side, not the demand side. As Henry Ford famously said, ‘If I had asked customers what they wanted, they’d have said a faster horse.’ Have you ever walked into a store looking for the thing you don’t know you need until you see it? Hardware stores are like that, as well as places like The Container Store.