“Supply and demand constantly determine the prices of commodities; never balance, or only coincidentally; but the cost of production, for its part, determines the oscillations of supply and demand.”

Grundrisse (1857-1858)
Source: Notebook I, The Chapter on Money, p. 58.

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Karl Marx290

German philosopher, economist, sociologist, journalist and … 1818–1883

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“The opinions that the price of commodities depends solely on the proportion of supply and demand, or demand to supply, has become almost an axiom in political economy, and has been the source of much error in that science.”

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Source: The Principles of Political Economy and Taxation (1821) (Third Edition), Chapter XXX, Influence of Demand and Supply, p. 260

“Which comes first — price being set by the intersection of supply and demand, or individual firms equating marginal cost to price?”

Steve Keen (1953) Australian economist

Source: Debunking Economics - The Naked Emperor Of The Social Sciences (2001), Chapter 4, Size Does Matter, p. 101

“A market is a group of buyers and sellers of a particular good or service. The buyers as a group determine the demand for the product, and the sellers as a group determine the supply of the product. Markets take many forms. Some markets are highly organized, such as the markets for many agricultural commodities. In these markets, buyers and sellers meet at a specific time and place, where an auctioneer helps set prices and arrange sales. More often, markets are less organized.”

N. Gregory Mankiw (1958) American economist

Source: Principles of Economics (1998-), Ch. 4. The Market Forces of Supply and Demand; p. 66

“Generally speaking, changes in the prices of finished goods are "cost determined" while changes in the prices of raw materials inclusive of primary foodstuffs are "demand determined."”

Michał Kalecki (1899–1970) Polish economist

Source: Theory of Economic Dynamics (1965), Chapter 1, Cost and Prices, p. 11

“Labor is like any other commodity in the market — increase the demand for it and you increase the price of it. Reduce the supply of black labor by colonizing the black laborer out of the country, and by precisely so much you increase the demand for and wages of white labor.”

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Source: 1860s, Second State of the Union address (1862)

“So far we have studies how, for each commodity by itself, the law of demand in connection with the conditions of production of that commodity, determines the price of it and regulates the incomes of its producers. We considered as given and invariable the prices of other commodities and the incomes of other producers; but, in reality the economic system is a whole of which the parts are connected and react on each other. An increase in the incomes of the producers of commodity A will affect the demand for commodities Band C, etc., and the incomes of their producers, and, by its reaction will involve a change in the demand for A. It seems, therefore, as if, for a complete and rigorous solution of the problems relative to some parts of the economic system, it were indispensable to take the entire system into consideration. But this would surpass the powers of mathematical analysis and of our practical methods of calculation, even if the values of all the constants could be assigned to them numerically.”

Antoine Augustin Cournot Researches into the Mathematical Principles of the Theory of Wealth

Source: Researches into the Mathematical Principles of the Theory of Wealth, 1897, p. 137

“But it is clear that the price of labour has no necessary connection with the price of food, since it depends entirely on the supply of labourers compared with the demand.”

David Ricardo (1772–1823) British political economist, broker and politician

Source: The Principles of Political Economy and Taxation (1821) (Third Edition), Chapter XVI, Taxes on Wages, p. 141

“While, under the handicraft of small-unit system of production was that typical a century ago, demand created the supply, today supply must actively seek to create its corresponding demand. A single factory, potentially capable of supplying a whole continent with its particular product, cannot afford to wait until the public asks for its product; it must maintain constant touch, through advertising and propaganda, with the vast public in order to assure itself the continuous demand which alone will make its costly plant profitable. This entails a vastly more complex system of distribution than formerly.”

Edward Bernays book Propaganda

Page 84
Propaganda (1928)

“Labor is a commodity, like any other, and its price is therefore determined by exactly the same laws that apply to other commodities. In a regime of big industry or of free competition – as we shall see, the two come to the same thing – the price of a commodity is, on the average, always equal to its cost of production. Hence, the price of labor is also equal to the cost of production of labor. But, the costs of production of labor consist of precisely the quantity of means of subsistence necessary to enable the worker to continue working, and to prevent the working class from dying out. The worker will therefore get no more for his labor than is necessary for this purpose; the price of labor, or the wage, will, in other words, be the lowest, the minimum, required for the maintenance of life.”

Friedrich Engels (1820–1895) German social scientist, author, political theorist, and philosopher

(1847)

“The equilibrium between supply and demand is achieved only through a reaction against the upsetting of the equilibrium.”

David Harvey (1935) British anthropologist

Source: The Limits To Capital (2006 VERSO Edition), Chapter 3, Production, Consumption and Surplus Value, p. 82

“Supply and demand constantly determine the prices of commodities; never balance, or only coincidentally; but the cost of production, for its part, determines the oscillations of supply and demand.”

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Karl Marx290

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