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Rand’s Ethics and Say’s Law

Image: Wikimedia Commons 1, 2

Image: Wikimedia Commons 1, 2

Ayn Rand famously summarized her ethics of rational egoism with the proverb “God said: ‘Take what you want, and pay for it.’” The idea here is that if you want the values that will serve your life and happiness (e.g., a fulfilling career, romance, leisure time, recreation) then, by the nature of reality (“God said”), you must enact the necessary causes (“pay for it”). Rand, of course, was an atheist, so her use of “God” here is metaphorical.

It is interesting to note that the basic law governing the field of economics, Say’s Law, is essentially this same principle applied to the marketplace.

Say’s Law—named after the French economist Jean-Baptiste Say—is the recognition of the fact that in order to purchase goods or services in a marketplace, you must first produce value with which to trade. As Say put it: “Products are paid for with products.” More tersely: Supply constitutes demand. This does not mean that if you create something it will necessarily have value in the marketplace; rather, it means that if you want to offer value in the marketplace, you must create something that will serve that purpose.

Seen in this light, economics, far from being a “value-free” science (as some economists claim), is actually a branch of ethics. Whereas rational ethics holds that if you want the values on which your life and happiness depend, you must take the actions necessary to gain and keep those values; rational economics holds that if you want to trade value for value in the marketplace, you must first produce value with which to trade. The latter is an application of the former.

This integration speaks both to the practicality of rational ethics and to the morality of rational economics. Bear it in mind when thinking about or discussing either field. Minds are changed for the better one integration at a time.

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