Should we teach supply and demand in French?

A simple post, mainly aimed at people like me who teach Intro Economics.

For decades I've been puzzling over the problem of how best to explain to first year students exactly what "quantity demanded" and "quantity supplied" mean. Then it suddenly struck me: it must be so much easier in French! (Can anybody who teaches Intro Economics in French confirm this?)

Let me explain.

When we define "quantity demanded" we have to steer a fine line between two dangers. It's not the same as quantity actually bought. But neither is it just an idle wish of what we would like to buy, if circumstances were different. It's what you would actually buy, if you found a seller.

We face the same two dangers with "quantity supplied". It's not the same as quantity actually sold. But neither is it just an idle wish of what you would like to sell, if circumstances were different. It's what you would actually sell, if you found a buyer. And since "supplied" is sometimes used as a synonym for "provided", that first danger, of confusing it with quantity sold, is even greater.

Greg Mankiw's Principles text defines quantity demanded as the quantity that "buyers are willing and able to purchase". And quantity supplied as the quantity that "sellers are willing and able to sell". (My italics). It's the "and able" which causes the problems. I know why he added it, to rule out idle wishes not backed up by hard cash or goods, but it's not strictly right. For example, when discussing price controls he talks about cases where buyers are able to buy less than the quantity demanded, or where sellers are able to sell less than the quantity supplied. We know what he means, but strictly speaking this makes no logical sense at all. "Buyers are able to buy less than they are willing and able to buy"?

It must be so much easier in French, when you talk about "offre et demande", right? "Offre" means "offer, and "demande" means, well, it's closer to "request" or "ask for", rather than an imperious "demand!". The two terms are almost self-explanatory. If you offer to sell something it's not the same as actually selling it; but if we assume the offer is genuine it means you would actually sell it if the other side accepted the offer. And if you request to buy something it's not the same as actually buying something; but if we assume the request is genuine it means you would actually buy it if the other side agreed to your request.

Comments

[Kevin Donoghue]

Well you could say offer and bid, as in financial markets. But perhaps you'd then need to rename the offer curve.

[Matt]

Why not frame it in terms of capital markets? "Quantity demanded" is the bid size, "quantity supplied" is the offer size.

[Matt]

Sorry, kevin. Posted that before I saw your comment.

[Brett]

All these words are metaphors at some level, and with any metaphor, you have to be careful and conscious about which part of it you carry over from the original concept and which part you don't. Of course, some metaphors are more instructive or more apt than others, but these also are more prone to being taken for "true" representations rather than metaphors. As Alexander Rosenbluth and Norbert Wiener have written, "The price of metaphor is eternal vigilance."

[Nick Rowe]

The capital market terms do work better.

Brett: good and interesting point. Somehow though, all theories are like metaphors. Translating them into the real world always requires vigilance.

[Matt]

Nick, the capital markets terms work better because there's a significant body of work on market microstructure in those contexts (and a monetary incentive to understanding it well).

Other intro econ subjects would benefit as well from some examples from the capital markets as well; you actually have Walrasian auctioneers (market makers and exchanges), free trade equilibriating prices (interexchange arbitrage), ...

[Nick Rowe]

Matt: and (as someone commented on my P-data Q-data L-data post) you can actually sometimes *see* part the demand and supply curves (all the bids and offers quantity-price data).

[Matt]

Unless they've gone dark of course.... ;)

then the Walrasian auctioneer is a computer program which makes markets algorithmically...

[westslope]

Interesting observation Nick.

The ambiguity does appear more important for anglophone economists than francophone economists though I often see ambiguous use of the term demand in both English-Canadian and québécois French-language popular media.

Question: If policy-makers better understood 'demand schedules' and 'willingness to pay' would it make a difference?