Who was Jean-Baptiste Say? How does his theory (or "law") compare with that of John Maynard Keynes?
What will be an ideal response?
Jean-Baptiste Say was a French economist born in 1767. He reasoned, in his best-selling book, Treatise in Political Economy, that the supply side of the market is the dominant factor in the market in achieving the equilibrium. He argued that the production of goods and services would create the income necessary to demand these goods and service, hence the phrase "supply creates its own demand." This idea became known as Say's Law. On the other hand, John Maynard Keynes, a British economist born in 1883 and a key figure in establishing the International Monetary Fund (IMF), took the opposite view of his predecessor. He advocated that it is the effective demand that rules the roost in determining the real GDP and that the mere production of goods and services was no guarantee that there would exist demand for them.
You might also like to view...
Workers do not know the safety records at individual firms; they only know industry averages. As a result,
A) each firm tries to outdo each other in making safety improvements. B) each firm has the incentive to be the safest in its industry. C) the equilibrium level of safety is less than optimal. D) the optimal level of safety is achieved.
In the same city, one job currently pays $6 more per hour than another job. The two jobs have equivalent training requirements, but labor is not migrating toward the higher-paying occupation. Both markets are perfectly competitive. Which of the following conclusions is correct?
a. The lower-paying occupation has less attractive nonmonetary characteristics. b. There are barriers to entry into the higher-paying occupation. c. The higher-paying occupation has a dominant labor union. d. There are barriers to entry into the lower-paying occupation. e. The higher-paying occupation has less attractive nonmonetary characteristics.