Consumer’s requirements are the real criteria according to which the goods are there. Only what consumer wants is among the economic goods; all the rest does not belong to the system of goods and is deprived of any economic significance. The goods are dependent on each other, so the transition from one to the next is ordained as a need, and thus a consumer is the agency of an explicit want. Wants define the goods, and consumer delineates the wants in a system of wants. Yet the entrepreneur, as the actual consumer in the productive consumption, is revealing the wants and enjoys consumer sovereignty analogous to the producer sovereignty.
Historical Backdrop
• ADAM SMITH The Wealth of Nations: consumption is the sole end and purpose of all production.
• WILLIAM HUTT Economists and the Public: consumer sovereignty.
• LUDWIC VON MISES Human Action: sovereignty of the consumers.
• SIMON KUZNETS Proportion of Capital Formation to National Product: consumer sovereignty.
• MILTON FRIEDMAN A Theory of Consumption Function: consumer behaviour.
• GARY BACKER The Economic Approach to Human Behaviour: consumer behaviour.