Thank you very much, Richard, for your illuminating post. The story is now becoming very interesting: not only the story of the origin of Say's law, but also the story of the criticism of the law.

One obvious connection that springs to mind concerns Marx. His interpretation of the gluts debate was framed by means of the reproduction schemes, which he elaborated from Quesnay's Tableaux representing the circular flow. Marx derived dynamic equilibrium conditions, that showed at once how reproduction can take place (against Mathus and Sismondi's view), and how it can go wrong (against Ricardo and Say), to which he added an explanation of why it must periodically go wrong. Note that, similarly to Robinet/Mercier and differently from Ricardo, Marx's argument is framed in terms of equilibrium.

A less known connection concerns another French writer, Aguste Ott. He was a social economist, who could escape the grip on publication outlets firmly held by the French liberals because he was writing in a Catholic encyclopedia. In 1854 he wrote an article on crises where he explicitly rejected Say's law, and did so by means of tableaux of exchanges that bear some similarity to Marx's schemes (I do not think Marx had read Ott's piece). Again, equilibrium and its conditions —that is, the possibility of the circular flow to take place-- were at the centre of the argument.

A third connection concerns the definition of crises that were formulated in the 19th century. Obviously most of them were published in dictionaries. In most dictionaries (in particular in France) crises were defined in terms of disturbances of the normal flow of business, and occasionally in terms of some of the features that characterize them. Other writers, however, defined crises as situations where equilibrium is disrupted. So we have on one side an undertsanding in terms of normal/abnormal, or health/disease (both couples are easily understandable, but ill-defined: health, indeed, was understood simply as the absence of disease, and normality as absence of abnormalities, without any precise and positive characterization), and on the other side an understanding in terms of equilibrium/disequilibrium. Now, all the latter writers were German. This is by no means an accident, since within a tradition where theorists openly questioned Say's law the debate was framed in terms of equilibrium between supply and demand, and on the conditions that guarantee such an equilibrium. Such a question obviously wouldn't make any sense for the upholders of Say's law, and wouldn't arise if the validity of Say's law was never questioned. Obviously the analytical perspectives opened by an analysis in terms of precise notions such as equilibrium and disequilibrium are further reaching than the possibilities opened by a discussion in terms of ill-defined concepts.

Knowing now that at the origin of Say's law there was a conceptualization in terms of the conditions of reproduction of a circular flow helps making sense of what was lost in the process and regained later, and helps placing in a broader context  the rescuing of the original problem.

Daniele Besomi

Il giorno 3-feb-2014, alle ore 18.02, Van Den Berg, Richard ha scritto:

> Since we should be concentrating on historical questions in these postings (roughly 'who said, what when and what could they have meant?' rather then 'were they right?'), it should be pointed out what the origin is of Danielle Besomi's (translated and very relevant) passage from Robinet's Dictionnaire. It is a verbatim quotation from Mercier de la Riviere's L'ordre naturel et essentiel des societes politiques of 1767. The most important thing about this is not that the date is quite a bit earlier than 1780, but of course the fact that Mercier's work was one of the great works of physiocracy (unfortunately never translated into English).
> 
> Mercier's discussion is intimately related to Quesnay seminal conception of the economy of a circular flow of incomes. One finds passages similar to that of Mercier in other physiocrats. For instance how about this one from Le Trosne's De 'linterest social of 1777 (my translation):
> 
> 'Reproduction and consumption are reciprocally the meause of one another. Although everything procedes from reproduction, since this is what decides about consumption and the means to pay for [reproduction], these two causes react upon one another. Reproduction is the measure of consumption, and consumption is the measure of reproduction'
> 
> Le Trosne also uses the phrase 'products can only be paid for by products [les productions ne se payant qu'avec des productions]' which is worth noting since Say used identical words in the Traite of 1803 (p.180). Also cf. Mill (1808:83).
> 
> Commentators like Marx and Spengler have pointed out that Say owed more to the physiocrats than he let on. Before one can start thinking about the question what interruption to circular flow are possible one first needs a clear conception about what circular flow is and here ideas really go back to the great Quesnay (yes building on authors like Cantillon and Boisguilbert).
> 
> Of course, unlike Say, the physiocrats stressed that interruptions are possible and can be persistent. One of them is 'hoarding' (besides landlords spending too small a proportion of their rent income on agricultural products and wrongheaded government policies like indirect taxes and trade restrictions). They did however not, as far as I am aware, write about the possibility of 'general gluts'. Arguably, not even British (pale) imitators like Gray and Spence (to whom Mill's 1808 work was a response) were talking about general gluts.
> 
> Richard van den Berg
> ________________________________________
> From: Societies for the History of Economics [[log in to unmask]] On Behalf Of Daniele Besomi [[log in to unmask]]
> Sent: Saturday, February 01, 2014 7:34 AM
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> Subject: Re: [SHOE] L'offre crée même la deman de
> 
> If we want to set the facts concerning Say's law straight, let's do it properly. Its history begins far earlier than Mill, since it is very precisely stated in a dictionary in 1780:
> 
> ‘Nobody can be a buyer unless he is also a seller; since buying implies paying, nobody can buy unless he sells, because only by selling can he procure the money to buy what he buys. From the fact that every buyer must be a seller and that he can buy only if he sells, a second axiom results, namely, that every seller must also be a buyer, and he cannot sell unless he buys. Therefore every vendor must, by way of the purchases he performs in turn, provide everybody else with the money for buying the goods the vendor wants to sell them.’ There may not be perfect matching between individual sales and purchases, but if someone becomes richer by selling more than he buys, someone else is ruined by buying more than he sells, so that ‘by the opposition between these two sorts of disorder, equilibrium is re-established in the general mass of sales and purchases (entry on COMMERCE in Robinet’s Dictionnaire universel des sciences morale, économique, politique et diplomatique, vol. 12, pp. 444–445).
> ......