Walras’s law is derived from the budget constraints of all the economic agents in the economy. Can Say’s law be similarly derived from budget constraints? Use the relevant constraints and specify the additional assumptions needed for this derivation. Assess the validity of these assumptions.
(i) Walras’s law is derived from the budget constraints of all the economic agents in the economy. Can Say’s law be similarly derived from budget constraints? Use the relevant constraints and specify the additional assumptions needed for this derivation. Assess the validity of these assumptions.
(ii) What are the implications for
(iii) Do the modern classical or/and new classical schools effectively reinstate Say’s law as one of their component doctrines? Is so, should they state it explicitly? Discuss
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