This is what I had always assumed - that Marshall saw demand price (or willingness to pay) as a function of quantity. Then demand price and supply price (marginal cost) determine the price. The trouble is - as Marshall was well aware - that this only makes sense if the marginal utility of money is constant, because if not the demand price will be (indirectly) a function of the price (since it determines, for any given quantity of the good, the amount of the other good the consumer with a fixed income can buy, and so the marginal utility of a dollar spent on the other good - the marginal utility of money) and so cannot explain price. 

-----Original Message-----
From: Societies for the History of Economics [mailto:[log in to unmask]] On Behalf Of [log in to unmask]
Sent: Thursday, February 03, 2011 1:55 PM
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Subject: Re: [SHOE] The reversed axes of supply and demand

Here's "another", not claiming to be "the", answer.  In Bk. III, Marshall
defined the demand price or marginal demand price of a good as the value
of the marginal purchase. The value of the marginal purchase depends on
the marginal utility of the good and the marginal utility of money (which
Marshall generally held constant by using examples where income effects of
price changes are trivial.)  With a constant marginal utility of money
(because of the absence of the income effect), the marginal demand price
varies inversely with the quantity--not the Cournot or Walrasian approach 
in which quantity demanded varies inversely with price.  In short,
Marshall saw quantity as independent and marginal demand price as
dependent, and his axes aren't "reversed."

However, Marshall was far from consistent on this.  In his paragraph
defining the law of demand he argues:

There is then one general law of demand:--The greater the amount to be
sold, the smaller must be the price at which it is offered in order than
it may find purchasers; or, in other words, the amound demanded with a
fall in price and diminishes with a rise in price.

As I read this paragraph, it says that quantity is independent and 
marginal demand price dependent, "or, in other words," price is
independent and quantity demanded is dependent!  No wonder it's confusing.