Chapter 2 SUPPLY AND DEMAND, AND THE VALUE OF MONEY

Hiatus between general theory of value and theory of value of money 46-47

Partly because former has been developed by different writers from those who have developed latter 47-49

But chiefly because supply and demand, cost of production, etc., assume fixed value of money, and are theories of price, rather than value 49

Supply and demand useful but superficial formula, common property of many value theories 49-50

Crude and unanalyzed in Smith and Ricardo; first made precise by J. S. Mill, who gives essentials of modern doctrine 49-51

B?hm-Bawerk's pseudo-psychology spoils Mill's clean-cut doctrine 51-52

Supply and demand assumes fixed value of money-unit, and hence inapplicable to money itself 52-56

But supply and demand does not assume fixed price-level 56-57

Cairnes vs. Mill 57-58

Mill's unsuccessful effort to apply supply and demand to money 59-62

Walker's attempt 62

Supply and demand in the "money market" 62-63