Economics of Trade and Specialization

In context of economics, self-sufficiency is the road to poverty, while specialization and trade makes us rich. The modern society has evolved to function in such a way where prosperity is anchored on trade between billions of individuals.

Steal. Improve your productivity. Trade with others.

By stealing from others, you will not enrich yourself. Instead, you will only negatively impact another person's desire to create wealth, and make them more protective of what they already have. Theft reduces production and makes it harder to take more.

Diversity. Trade takes our differences and encourages us to cooperate for a common good. One can get better at doing a certain task, or producing a good, and thus trade it with someone else, who is better at something else. Even if all of us are the same at everything, with addition of technology, it still makes sense to divide tasks between specialists, and to trade.

We have to leverage our human ability with technology, but it is important to realize that the tools used to increase productivity have to match the size of the market.

[Editor's summary] If you need to plow a veggie patch, you do not need an industrial tractor, but neither will you able to efficiently plow a field with a single shovel.

Before the existence of markets for goods and services, people had to learn various skills for themselves just to be able to do those things.

Now that we can trade in anything, it makes more economic sense to specialize, so you could trade your specialty with someone else's.

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