How an Economy Grows and Why It Crashes

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Trade on a national level is no different than labor 
specialization on a personal level. Each individual, or 
country, trades what it has in abundance, or what it does best, 
for the things that it doesn’t have or can’t easily make.  
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ow that the island community is so much bigger than it 
was when there were just three guys fi shing by hand, to 
some it may appear that the economics have changed…but 
have they? 
Just as the principles of mathematics don’t change with the 
size of the problem, basic economic principles do not change 
with the size of the economy. They’re just harder to see 
because of the many layers that exist between savers and 
borrowers. But the direct relationship among self-sacrifi ce, 
savings, credit, investment, economic incentive, and social 
and economic progress are always the same.