A Rehabilitation of Say’s Law (W. H. Hutt)
- Highlight Loc. 169-74 | Added on Thursday, January 26, 2012, 12:40 AM
What Say was really showing was that the crucial nexus between potential sellers and potential buyers (potential suppliers and potential demanders) which, when constrained, causes a slowing down of productive activity, is never constrained through the use of money or through monetary policy but through defects in pricing. Under the conditions of his day, no grounds existed for Say to add what it would have been appropriate to have added in the present era, namely, “even although deflation may magnify the consequences of defects in the pricing process and unanticipated inflation minimize those consequences” [my phrasing].
