Tableau économique
The Tableau économique (French pronunciation: [tablo ekɔnɔmik]) or Economic Table is an economic model first described by French economist François Quesnay in 1758, which laid the foundation of the Physiocratic school of economics.
Quesnay believed that trade and industry were not sources of wealth, and instead in his 1758 manuscript Tableau économique (Economic Table) argued that agricultural surpluses, by flowing through the economy in the form of rent, wages, and purchases were the real economic movers, for two reasons. First, regulation impedes the flow of income throughout all social classes and therefore economic development. Second, taxes on the productive classes such as farmers should be reduced in favor of higher taxes for unproductive classes such as landowners, since their luxurious way of life distorts the income flow.
The model Quesnay created consisted of three economic movers. The "Proprietary" class consisted of only landowners. The "Productive" class consisted of all agricultural laborers. The "Sterile" class is made up of artisans and merchants. The flow of production and/or cash between the three classes started with the Proprietary class because they own the land and they buy from both of the other classes. The process has these steps (consult Figure 1).
The Tableau shows the reason why the Physiocrats disagreed with Cantillon about exporting food. The economy produces a surplus of food, and neither the farmer nor the artisan can afford to consume more than a subsistence level of food. The landlord is assumed to be consuming at a level of satiation; therefore, he cannot consume any more. Since food cannot be stored easily, it is necessary to sell it to someone who can use it. This is where the merchant provides value.
The merchant is not a source of wealth, however. The Physiocrats believed that “neither industry nor commerce generates wealth.” A “plausible explanation is that the Physiocrats developed their theory in light of the actual situation of the French economy…” France was an absolute monarchy with the land owners constituting 6-8% of the population and owning 50% of the land. (5, p. 859) Agriculture contributes 80% of the country’s wealth, and the non-land owning segment of the population “practises a subsistence agriculture that produces the essential minimum, with virtually all income being absorbed by food requirements.” Additionally, exports consisted mostly of agricultural-based products, e.g. wine. Given the massive effect of agriculture on France’s economy, it was more likely they would develop an economic model that used it to the king’s advantage.
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