🚀 go-pugleaf

fbonsign...@beethoven.com wrote:
> Say's Law states that production doesn't create demand. This places
the
> engine of economies on the consumer. If the consumer wants it,
somebody
> will produce it and will make an income (profit), but if consumers
> don't want it, production won't make them demand it, so they won't
make
> a profit. Yet this is true only if the principle of biological
> diversity is overlooked! Humans are diverse, actually we are the most
> diverse of all living beings! This means there will always be demand
> for *any* good we can conceive of. (This is particularly true if we
> take into account great fortunes, as they will demand any goodto make
> their consumption efficient: they will buy it because they can).
>
> So Say's Law is a matter of equilibria, as always: producers will
make
> a profit only if demand is sufficient, but for demand to be
sufficient
> doesn't mean a big market size, it means efficient technology! Given
an
> efficient technology cost will be so low that even a small demand
will
> be enough to make profits *even if those profits are not enough to
make
> a living*.
>
> So prodction can create demand, or rather, any produced good can be
> matched by some potential demand waiting to be expressed. This is the
> value of novelty, for instance, and it is guaranteed by the principle
> of biological diversity.
>
> Fabrizio J Bonsignore, now Danilo J Bonsignore

On another venue of thought, Say's "Law" has a hidden, nasty meaning:
it places a constraint on production! In other words, don't produce
variety, as there may be no consumers for the new goods!

The fact is that with computers and flexible production techniques (are
they in place?), in fact, with taylored production, which ought to be
possible by now with appropriate technologies, any product should be
able to be produced not only efficiently but in the right amount to the
demand. While Say's Law may have been adequate for the century it was
conceived in, with advances in technology it becomes not a law but more
like a pattern. Of course, it has also been argued that it can be
defeated with marketing, though marketing is a cost of production too
and establishes another tradeoff and equilibrium.

I want to emphasize that as wealth increases this law loses meaning and
becomes an *inferior* law, in terms of theory (metaeconomics! even
economic theory is ubject to economic "laws", i.e. theoretical work is
also subject to economics! Economics is a fnudamental Science.) Higher
leveks of wealth (and income) will produce more diverse economies in
terms of diversity of goods (standard deviation higher).

Fabrizio J Bonsignore, now Danilo J Bonsignore
(don't believe the rumor: I am not drug addicted, though I do smoke
tobacco...)