# Jean-Baptiste Say: His Impact on Economics and Say's Law Explained

> **Definition**
>
> Jean-Baptiste Say was a French classical liberal economist known for his Law of Markets stating that production creates demand.

Jean-Baptiste Say was a French classical liberal economist whose advocacy of free markets and competition greatly influenced economic thought. Inspired by Adam Smith's "The Wealth of Nations," Say became known for his Law of Markets, a foundational theory asserting that production itself creates demand, arguing that the ability to buy goods comes from producing others. Born in Lyon, Say served on a government finance committee under Napoleon and later taught political economy at several French schools, helping spread [classical economic](https://www.investopedia.com/terms/c/classicaleconomics.asp) ideas across France.

### Key Takeaways

*   Jean-Baptiste Say was a French economist known for Say's Law of Markets, which asserts that production creates demand.
*   Say was influenced by Adam Smith and promoted free market and laissez-faire economic theories in France.
*   He served on a government finance committee under Napoleon and taught political economy in various French schools.
*   Say's Law of Markets suggests that economic goods production generates demand, preventing sustained oversupply in an economy.
*   Say co-founded the world's first business school, ESCP Europe, in 1819.

![Jean-Baptiste Say](https://www.investopedia.com/thmb/CZV_Gn2PUagH0Ypp20C-_aG12Uw=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/jean-baptiste-say_round3-4b8d65fd5fde497296e774cb6f8008c4.png)

*— Investopedia / Alison Czinkota*

## Jean-Baptiste Say's Formative Years and Learning

Jean-Baptiste Say, also known as J.B. Say, was born on Jan. 5, 1767, in Lyon, France. He went to school in Lyon before moving to London to study business. Say returned to France in 1787 and lived in Paris with his family.

He found work as a secretary in a Paris-based insurance company run by Etienne Claviere, a politician and financier of the French Revolution. This was where he first came across Adam Smith's "[An Inquiry into the Nature and Causes of the Wealth of Nations](https://www.investopedia.com/updates/adam-smith-wealth-of-nations/)." Say was heavily influenced by Smith's work and, using the connections he made through Claviere, became a journalist.

In 1799, Say became a member of the Tribunate, a kind of economic institute which operated under the French government. Emperor Napoleon Bonaparte, who disliked Say's ideas, removed Say from his post with the institute a few years later.

Say managed to open a cotton-spinning mill in 1807 and six years later, he sold the business. Say became the chair of industrial economy at the Conservatory of Arts and Crafts from 1817 to 1830. He also taught political economy at the Collège de France until his death in 1832.

## Say's Influential Achievements in Economics

Say was heavily influenced by Adam Smith and the economic theories he laid out in his 1776 book _Wealth of Nations_. He strongly supported Smith's [free market](https://www.investopedia.com/terms/f/freemarket.asp) theories and helped popularize laissez-faire ideas in France through his academic work. Say also expressed the belief that a falling price level could be a positive occurrence if it resulted from productivity gains rather than from [deflation](https://www.investopedia.com/terms/d/deflation.asp).

Say is known for [Say's Law of Markets](https://www.investopedia.com/terms/s/says-law.asp), which states that a buyer must produce something of value to gain purchasing power. This means that demand in an economy comes from prior production. As a result, there can never be a sustained general oversupply of goods in an economy because producing economic goods is what creates general demand for goods.

Say's Law does not claim that there can never be imbalances in [supply and demand](https://www.investopedia.com/terms/l/law-of-supply-demand.asp) for specific goods. However, he believed that as prices adjust, supply and demand will balance, making price adjustments crucial for general market balance.  

> **Fast Fact**
>
> Say's economist contemporaries included James Mill, Jeremy Bentham, and David Ricardo.

## Key Publications by Jean-Baptiste Say

Say wrote about money, banking, and saw [taxation](https://www.investopedia.com/terms/t/taxation.asp) as burdensome. He is best known for his book "A Treatise on Political Economy," published in 1803.

In addition to his famous Treatise, his other published works include the two-volume _Complete Course in Practical Political Economy_, which was published in 1852, and a collection of his correspondence with fellow economist Thomas Malthus, titled _Letters to Mr. Malthus_. This publication discussed and debated his critics' theories of [economic growth](https://www.investopedia.com/terms/e/economicgrowth.asp).  

## The Lasting Influence of Say's Economic Ideas

Say's Law of Markets lives on in modern [neoclassical economic](https://www.investopedia.com/terms/n/neoclassical.asp) models which argue that if prices are flexible enough for all markets to clear, then the economy will tend toward stability. While it implies that the economy is in a sense self-regulating so that production is ultimately the source of demand, the law has been misinterpreted and frequently taken to mean that supply creates its own demand. Say was a supporter of free trade and competition and championed fewer restrictions on businesses.

Contemporary economists [John Maynard Keynes](https://www.investopedia.com/terms/j/john_maynard_keynes.asp) and [Thomas Malthus](https://www.investopedia.com/terms/t/thomas-malthus.asp) criticized Say’s law. Later economists point to Keynes as partly or chiefly responsible for the confusion over Say's Law, characterizing Keynes's restatement of the Law as a straw man that misrepresents Say's Law in order to further Keynes's arguments at the expense of classical economics.

Say's works, translated to English, impressed American founding fathers like Thomas Jefferson and James Madison. Jefferson even invited Say to move to Virginia.

Robert L. Formaini from the Federal Reserve Bank of Dallas credits Say as one of the first economists to discuss entrepreneurship and utility, highlighting entrepreneurs' role in meeting "human wants."

> **Fast Fact**
>
> Say co-founded ESCP Europe in 1819, considered the world's first business school..

## Say's Personal Journey and Family Life

Jean-Baptiste Say spent some time in the French military, where he served in a volunteer battalion. In 1793, he married Julie Gourdel-Deloches. This allowed him to avoid mandatory conscription in the military. The couple had two children, Horace Emile Say and Adrienne Say.

Say's wife died in 1830; Say died on Nov. 15, 1832. He is buried in Père Lachaise in Paris.  

## Who Was Jean-Baptiste Say?

Jean-Baptiste Say was a French classical liberal economist. Born in 1767, Say worked in the French government under Napoleon (who later let him go) and as a professor of political economy at various schools in France. Say was influenced by Adam Smith, who is considered the father of modern economics. He used his position to teach Smith's beliefs and theories in France. His own theories, including the Law of Markets, are commonly studied even today. Say's Theory of Markets states that society must generate income before people can purchase any goods and services. He was also a proponent of competition, free trade, and lifting restraints on business.

## What Type of Economy Influenced Jean-Baptiste Say?

Jean-Baptiste Say was heavily influenced by the economic theories laid out by Adam Smith in his book _The Wealth of Nations_. He believed in Smith's free market and laissez-faire economic theories. Say spent a great deal of time and effort highlighting these subjects in his own educational and professional pursuits.

## What Is Say's Law of Markets?

Say's Law of Markets is a classical economic theory that states that individuals need to produce and generate income in order to purchase goods and services. According to Say, demand occurs before any production takes place—not because of the income generated. This law addresses how individuals create wealth along with how economic activity works.

## The Bottom Line

Jean-Baptiste Say was a French economist whose ideas shaped the foundations of modern market theory. Influenced by Adam Smith and active during Napoleon's rule, he championed competitive markets and fewer trade restrictions while teaching political economy across France. Say's lasting legacy rests on his Law of Markets, which argues that production drives demand and continues to inform entrepreneurship and neoclassical economics today.  

> **Article Sources**
>
> 1.  Independent Institute. "[Jean-Baptiste Say](https://www.independent.org/news/article.asp?id=11640)."
>     
> 2.  Britannica. "[J.-B. Say](https://www.britannica.com/biography/J-B-Say)."
>     
> 3.  Concise Encyclopedia of Economics. "[Jean-Baptiste Say](https://www.econlib.org/library/Enc/bios/Say.html)."
>     
> 4.  Library of Economics and Liberty. "[A Treatise on Political Economy](https://www.econlib.org/library/Say/sayT.html)."
>     
> 5.  Founders Online. "[Thomas Jefferson to Jean Baptiste Say, 2 March 1815](https://founders.archives.gov/documents/Jefferson/03-08-02-0242)."
>     
> 6.  Formaini, R. "[Jean-Baptiste Say: Foundations of France’s Free Trade Tradition](https://fraser.stlouisfed.org/title/economic-insights-federal-reserve-bank-dallas-6360/jean-baptiste-say-607564)." _Economic Insights_, vol. 11, no. 1, 2006, pp. 1-4.
>     
> 7.  University of Chicago Library. "[Guide to the Jean Baptiste Say Collection 1794-1821](https://www.lib.uchicago.edu/e/scrc/findingaids/view.php?eadid=ICU.SPCL.SAYJB)."
>     
> 8.  Duke Center for the History of Political Economy. "[Grave Sites of Famous Economists](https://hope.econ.duke.edu/gravesites)."