PPT-EPP-DALUSONG-SERGS.pptx.maljshdudhbhsudhdndjdudnd

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1. Cantillon’s Theory of Intrinsic Value •Definition of intrinsic value: “The amount and quality of land and labor used in production”
•Relationship between land and labor: Mutually dependent factors determining intrinsic value
•Emphasis on opportunity cost in evaluating intrinsic value (Thornton, 2007)

2. Intrinsic Value vs. Market Price

3. Cantillon’s Price-Specific Flow Mechanism Market price fluctuates due to supply and demand (“humor and fancies” of the market)Intrinsic value remains immutable in Cantillon’s viewIn the long run, market price tends to approximate intrinsic value

4. Cantillon’s Price-Specific Flow Mechanism

5. Limitations of Cantillon’s Price-Specific Flow

6. Cantillon’s Circular Flow Model

7. The Farmer as an Example of an Entrepreneur Description of the farmer as a model entrepreneur: > Hires labor >Pays a fixed rent to property owners > Operates under uncertainty Entrepreneurial judgment and response to supply and demand forces

8. Cantillon’s Influence on Adam Smith

9. Conclusion