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This “mechanism” operates for all goods and services simultaneously. So when the market price of a good falls below the level sufficient “to bring it thither,” some producers will move to the production of other goods for which the market price is above the level required “to bring it thither,” setting in motion a lowering of the market price.The preferences of consumers — reflected in prices — tell producers: “We have enough of good X, but we need more of good Y.” And producers have an incentive to respond cooperatively and produce more of good Y. All this and more — the division of labor, for example — go on without command — if the market is free.
What could be lovelier!
Bastiat commented: “We should be shutting our eyes to the facts if we refused to recognize that society cannot present such complicated combinations in which civil and criminal law play so little part without being subject to a prodigiously ingenious mechanism.”
Not just prodigiously ingenious, monsieur. Beautiful!
This article originally appeared at the Future of Freedom Foundation.