Throughout his writing career, Frederic Bastiat repeatedly emphasized that consumption is the end goal of economic activity, that the consumer should be the focus of economic analysis. While each man is both producer and consumer, man produces so he can consume. In other words, production is the means and consumption is the ends. This makes sense if we look at our own lives: we go to work so we can afford our homes, food, cars, clothes, etc. We don’t consume our clothes, cars, food, homes, so that we can work more!
Although not considered much of a theorist, Bastiat was a bit ahead of his time with this emphasis.* It would be another 50 years before the commonly-recognized supply and demand curve we use today was developed by Alfred Marshall. Using the Marshallian Curve, we can explore Bastiat’s** insights with regard to international trade.
Let’s ask the question:…
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