抄録
Ricardo (1817) classifies goods into scarce goods and produced goods, and thinks that the laws of supply and demand regulate the price of scarce goods and that the labor embodied value theory regulates the price of produced goods. He puts importance on a production cost principle because produced goods are more important economically. However, Ricardo in Notes on Malthus’s principles of Political Economy (1820) approves Malthus’s assertion that the laws of supply and demand are the principle governing whole pricing even if it is the natural price. How should we consider this fact?
The natural price is regulated by the production cost at the level of supply that is equal to the quantity of effective demand. Ricardo postulates a diminishing return in an agricultural sector, and an increasing return in an industrial sector. Therefore, a producer cannot determine a production cost per unit until the quantity of production is not determined. So, a producer has to grasp the effective demand in a market. That is to say, there is a strong relationship between an effective demand and the quantity of supply before the determination of a production cost.
For Ricardo, "the laws of supply and demand" are not an opponent concept to a production cost principle, but rather a necessary concept for a production cost principle to have validity to the reality. Such a classical pricing method is similar to a market base pricing (target costing) that a present-day manufacturing adopts.
