Intertemporal coordination and general gluts

A number of people were scathing about my post on general gluts, saying something to the effect of, "Well, Callahan made it easy for himself, picking a one-good economy!"

But the exact opposite is true: I picked a one-good economy with no money because that was the hardest case I could think of. The reason is that a general glut is an instance of an intertemporal coordination failure. The simplest case for intertemporal coordination is where I produce one good for myself. (I really should have left out the other two actors in my example to make it even more effective.) If a general glut is conceivable in that case, well, a fortiori it is conceivable in cases with more actors, more goods, and especially, with money.

The other thing people became very worked up about is the relationship of this possibility to "Say's Law." Well, the first thing to note is there just is no single "Say's Law." In classical economics, there were at least seven or eight distinct propositions held by Say and his allies (both Mills and Ricardo, among others) in the general glut debate. No concise statement of a "law" was given at the time. That didn't really happen until the 20th-century, and even then, different versions were given different formulations by different authors under different names: "Say's Identity," Walras's Identity," "Say's Law."

So, part of what you think my example means will depend upon how you want to formulate Say's Law. One way to do so and have it still hold in my example would be to say, "Sure, there was a surplus of fish, but there was simultaneously a shortage of leisure." Similarly, you could look at all booms as shortages of leisure, and the unemployment during the bust as the remedy for that deficiency.

And I can't say that is wrong: a definition can't be wrong. But that way of looking at things certainly would not have appealed to anyone in the original debate over the existence of general gluts: Say, Mill Sr. and Ricardo would have rejected this formulation as firmly as Malthus and Sismondi. The above formulation essential concedes Malthus was right, but then changes the target so that he loses after all.