Specialization and Trade

Chelsea German writes,

Last week, I wrote about a man who spent 6 months of his life and $1,500 to make a sandwich entirely from scratch, without the benefits of market exchange. The story illustrates how exchange and trade enrich our lives.

After making his incredibly costly sandwich, the same man embarked on an even costlier endeavor: making a suit from scratch. He picked cotton from a field, spun the cotton into thread, wove the thread into cloth, sheared wool from a sheep, harvested hemp, raised silkworms for their silk, killed a deer and tanned its hide to make leather. This process cost him 10 months of work and $4,000.

Pointer from Don Boudreaux.

I just don’t think you capture the phenomenon of specialization and trade with textbook economic models. It is not two-by-two trade. It is far more complex than that. And don’t get my started on representative-agent models of the GDP factory.

1 thought on “Specialization and Trade

  1. Along those lines, there is a very interesting project by a (Australian?) fellow, whose hobby is replicating, single-handedly, primitive technologies. Here’s a very interesting video of this one man building a kiln-fired clay tile roof hut from scratch, entirely by himself (i.e. he made all of the stone tools entirely by hand as well) in about 100 days. While it’s a neat project–a great accomplishment and a neat insight into primitive man–for my inner economist it really is mainly a point of comparison for what kind of house we can build today with a vast capital structure, worldwide trade, and a highly advanced division of labor.
    https://youtu.be/P73REgj-3UE

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