How an Economy Grows and Why It Crashes

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The splashing success of the Water Works project fl owed 
through the island’s economy. Pipelines, available for a 
reasonable charge, brought water great distances, and allowed 
previously infertile land to produce crops. 
The steady fl ow of water could be harnessed to operate 
machines, giving birth to new industries. 
Relieved of the task of hauling water by hand, everybody now 
had more time available for the production of consumer goods 
and services and for the development of new capital projects. 
The increased productivity allowed society to catch even more 
fi sh, and living standards rose as a result. 
Trade 
As the island economy expanded, its ability to export 
production abroad increased as well. Soon giant cargo 
canoes were sailing over the open ocean, fully loaded with 
fi sh, carts, surfboards, spears, and canoes. In exchange for 

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