![]() ![]() Most of that stuff has no value to anyone, but some of the stuff in there probably does, but its not worth my time to find the person to whom it is valuable and then coordinate with them to get them the stuff. In fact, I pay people to haul away my excess stuff twice a week. THere are lots of times in life where its way more valuable to have less stuff. But everyone is better of because the assessed value of the things they end up with is more than the assessed value of the things they gave up. For this knowledge everyone else pays a small stipend to the middleman. But when the number of participants gets large, you have two choices, either:Ī) Everyone has to know what everyone else values and doesn’t value, orī) A middleman alleviates everyone’s requirement to know everyone else’s values by aggregating them. When you only have one other person to trade with, it’s easy to figure out who values what. Everyone has increased the value of their stuff. Now Julie has 6 peanuts which she values, and Jim has 2 cigarettes which he values. By trading, the physical quantity of stuff has not increased. Julie assesses no value to the cigratte, but assesses value to the peanuts. Jim assesses no value to the peanuts while assessing value to the cigarette. Jim & Julie each have the same physical quantity of stuff, but each assesses the value of the stuff differently. Now here are the people: Julie is a non-smoker. Here’s the ration: 1 cigarette, 3 peanuts. I’m very late to the party, but I think that an example of how this works would be to imagine two people each given the same ration. ![]()
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