Quote from: dinofelis on April 14, 2015, 07:08:10 AM

Quote from: twiifm on April 13, 2015, 07:59:22 PM

Who cares about Say's Law? Its not correct and outdated

It is obviously correct, because it is simple accountancy. The entire sales of any enterprise goes exactly to all of the production factors: wages (paying labor), dividends (paying capital and entrepreneurship), and the buying of other materials and services (ground), which are, themselves then, again inputs to other enterprises.

In the end, every penny that is earned in selling the goods, comes in the hands of someone, directly or indirectly involved in its production. All those pennies together are, obviously, exactly equal to the sum of the prices of the sold goods. So all those receivers of those pennies can buy exactly the sold goods.

Never ever can goods be sold that cannot be bought by the income generated by that sale. Of course, it is not because those goods can be bought, that they WILL be bought, because the receivers of those sales incomes might want OTHER things. But every penny that is an income from a sales, will end up in SOMEONE's pockets, and can hence in principle be spend to buy that product. That's the essence of the contents of Say's law. It is simple, mathematical, bookkeeping.

The only way in which Say's law could be wrong, is if somebody were to burry some money received from the sales, to never dig it up again. Then, the sum of all the prices of the sold goods, minus the amount of money burried, would of course not be sufficient to buy all those goods. But that is because there would be a "leak" in the money fluxes.

Uh no. If Say's Law is correct then we shouldn't see things like The Great Depression or deflationary spirals.

Virtually all of mainstream economics accept Keynes rejection of Say's Law