Jean-Baptiste Say – A Treatise on Political Economy
Say was an early 19th century French economist, most famous for what we now call Say’s Law. It is often cynically misunderstood as meaning “supply creates its own demand.” A more accurate statement is that “abundance makes more abundance possible.”
Think of it this way: if you produce more value, have more you can trade to others in exchange for other things you value. If everyone does this, the result is a virtuous circle of growing prosperity. Even if people just act in their own self interest, other benefit. The more people who do this, the more people benefit, and to a greater degree.
Say’s Law is a very deep concept to which this short review cannot do justice; suffice it to say that when it clicked in my head, it gave me a major “eureka!” moment I have only experienced a few times in my life.
Say also roundly refutes the labor theory of value that John Locke, Adam Smith, and later, Karl Marx all used. But Say stops short of the subjective theory of value that Walras, Jevons, and Menger independently developed in the 1870s, and that nearly all economists use today.
In that respect, Say is an important bridge figure in economic history. He also displays much common sense on trade barriers, rent-seeking, and political corruption, and dispels common romance about preserving obsolete industries and jobs. On those issues, he remains pertinent reading nearly two centuries after his death.
Say’s book is also long overdue for a new English language edition–a perfect project for the good people at Liberty Fund. The old-timey edition linked to above (courtesy of Liberty Fund, naturally) has distracting and uninformed editorializing in endless footnotes by the translator and editor. They are less than helpful and beyond irksome–and date from 1830.
Say’s name is not obscure, but his Treatise is surprisingly hard to find. The link above might save interested readers some time. In the meantime, let us hope a new edition will come out sometime soon. Say still has much to teach us.