0
$\begingroup$

Keynes has disapproved the say's law "supply creates its own demand" but I want to know if there is any empirical evidence that this law doesn't hold true? Theoretically, keynes successfully disapproved it by stating that if supply is there and no demand follows or demand doesn't rise in proportion to the supply then inventories will build up and producers will be forced to cut price and halt production and then we will have slowdown. But does this hold true?

The reason for my curiosity is if look at things whether in realm of society or business, supply does create its own demand. For eg - Every new invention or technological breakthrough ranging from Ipod to computers, e commerce to MOOCs, they are first supplied and then demands build up. If I may also put it in abstract terms also then it seems to hold valid. For eg - The more we love, the more generous we are, the more gratitude we supply from our own side the more we find we are capable to render. In my opinion only by consistently supplying goodwill or any good thing can we hope to increase the substantive over superficial in our individual lives and in the collective dream called culture.

$\endgroup$
  • 2
    $\begingroup$ The two don't seem to contradict. The statement, "if there's supply AND there's no demand, then production will have to slowdown" is true. The statement, "if there's supply AND demand follows, then the supply can be sustained." is also true. $\endgroup$ – Art Oct 24 '19 at 2:03
  • 1
    $\begingroup$ I think it's worth noting that the creation of computers/ipods etc didn't magically create demand for them. They were already in demand, which is the reason they were created in the first place. $\endgroup$ – Clinical_Coder Oct 25 '19 at 13:45

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Browse other questions tagged or ask your own question.