What are the Weak and Strong versions of Say’s Law?

Prof. Mahendra Kumar Ghadoliya

Weak and Strong versions of Say’s Law:

At this point there is important to distinguish between two versions of Say’s Law.

Weak Version of say’s Law:

According to Trevithick[1] (1992) the weak version is taken to imply that each act of production and supply necessarily involves the creation of an equivalent demand for output in general. This version of Say’s Law is a weak version. This version does not guarantee that output produced will be consistent with full employment.  It may be any amount of production below or full employment level. This weak version of says law applies to both depressed or buoyant level of output.

Strong Version of say’s Law:

The strong version of Say’s Law states that in a competitive market economy there will be an automatic tendency for full employment to be established. Since the strong version o say’s law implies an equality of aggregate demand and supply which is consistent with labour market equilibrium, it is equivalent to the proposition that there is no obstacle to the achievement of full employment in terms of a deficiency of aggregate demand.

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[1]  Trivithick, J.A. (1992) Involuntary unemployment: Macroeconomics from Keynes perspectives, London Harvester- Wheat-sheaf quoted from a modern guide to macroeconomics, ‘An Introduction to Competing Schools of Thought’ by Snowdon,B. and et.al. (1998)