Why do economies always have to trade?

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Why does every village, city, state, country, and empire need to trade with entities external to itself to be economically viable, survive, and grow, but the Earth itself does not?

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Anonymous 0 Comments

You don’t have to trade. If you are self-sufficient, you can just make everything you need.

Trade happens when you realize that those people over there have something you want, and you have something they want, and exchanging things peacefully is faster and easier than killing them and taking their stuff.

More people allows for more specialization, which allows for the creation of better stuff. If 99% of the people in your town are farmers, then you don’t have a lot of people left over to be plumbers, bricklayers, chefs, or doctors. Also maybe some of your people are farmers because they have to be, even if they aren’t very good at it. Bob is a sucky farmer, but he’s a great carpenter. Your village is just too small for someone to make a living at being a carpenter. Trade with other villages gives Bob the opportunity to do something he’s good at, which helps everybody. He can fix somebody’s roof in exchange for a bunch of potatoes or something.

The more trade you have, the greater those opportunities are. You can eventually get people who make stupid videos where they play video games, and they actually earn a living doing it! Or you can get people whose only skill appears to be having a huge ass and making a sex tape. And they get rich.

Earth has to be self-sufficient, because we haven’t met anybody from another planet yet. Maybe some day aliens show up, and they’ve figured out how to cure cancer. And we’re like “We would like some of those cancer-curing pills. We see you haven’t figured out celebrity sex tapes yet. Would you like to trade?” And they say “Why do you think we traveled 5000 light years to your planet. Of course we would like some of your celebrity sex tapes.”

And then both planets prosper.

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