NOTICE
- NEVER TRUST THE FOLLOWING
Summery
- Principal axiom of classical economics: Say's law (S = D)
- Neo-classical generalization: Walras' law ($\Sigma{ps} = \Sigma{pd}$)
- Supply might be estimated as total wealth (in equilibrium theories, assumed somewhat constant, except on unpredictable changes of tastes and technologies)
- Demand might be formulated as utility function (might be usually function of price of goods, expectation, with any other endogeous parameters)
- Usually, tangible affections (shocks to technologies and tastes) to equilibrium is usually formulated in supply function, and demand is determined with markets alone
- Note that: Technology seems to be supply factor, but tastes are not supply factor for non-economists
Supply - Wealth - Exchange Value - Demand - Welfare - Utility - Use Value
- If you think all these words above have same meaning, you need only one word
- We use such words vaguely but quite differently
- These must not be confused each other
- And indeed Say's (Walras') law need theoretical justification
TODO
- State an acceptable definition for demand
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