is commonly said that their value depends on their scarcity; others say that the value depends on the demand and supply. But this statement requires much explanation. The supply of a commodity is an intelligible expression: it means the quantity offered for sale; the quantity that is to be had, at a given time and place, by those who wish to purchase it. But what is meant by the demand? Not the mere desire for the commodity. A beggar [pg 255] may desire a diamond; but his desire, however great, will have no influence on the price. Writers have therefore given a more limited sense to demand, and have defined it, the wish to possess, combined with the power of purchasing.207 To distinguish demand in this technical sense from the demand which is synonymous with desire, they call the former effectual demand.
General supply consists in the commodities offered in exchange for other commodities; general demand likewise, if no money exists, consists in the commodities offered