Front Page Titles (by Subject) Over-production. - The Theory of Political Economy
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Over-production. - William Stanley Jevons, The Theory of Political Economy 
The Theory of Political Economy (London: Macmillan, 1888) 3rd ed.
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The theory of the distribution of labour enables us to perceive clearly the meaning of over-production in trade. Early writers on Economics were always in fear of a supposed glut, arising from the powers of production surpassing the needs of consumers, so that industry would be stopped, employment fail, and all but the rich would be starved by the superfluity of commodities. The doctrine is evidently absurd and self-contradictory. As the acquirement of suitable commodities is the whole purpose of industry and trade, the greater the supplies obtained the more perfectly industry fulfils its purpose. To bring about a universal glut would be to accomplish completely the aim of the economist, which is to maximise the products of labour. But the supplies must be suitable—that is, they must be in proportion to the needs of the population. Over-production is not possible in all branches of industry at once, but it is possible in some as compared with others. If, by miscalculation, too much labour is spent in producing one commodity, say silk goods, our equations will not hold true. People will be more satiated with silk goods than cotton, woollen, or other goods. They will refuse, therefore, to purchase them at ratios of exchange corresponding to the labour expended. The producers will thus receive in exchange goods of less utility than they might have acquired by a better distribution of their labour.
In extending industry, therefore, we must be careful to extend it proportionally to all the requirements of the population. The more we can lower the degree of utility of all goods by satiating the desires of the purchasers the better; but we must lower the degrees of utility of different goods in a corresponding manner, otherwise there is an apparent glut and a real loss of labour.