I’m confused. Why would diminishing marginal returns incentivize trade? If the first unit of everything was very cheap then I would rather produce it myself than produce extra of one things (which costs more) then trade.
Yes, diminishing marginal utility plus increasing marginal production capability is the recipe for specialization and trade.
I think I agree with Eliezer (if I read correctly) that scarcity is the underlying motive—trade is only valuable if you want something and you can trade for it more easily/cheaply than you can produce it.
I’m confused. Why would diminishing marginal returns incentivize trade? If the first unit of everything was very cheap then I would rather produce it myself than produce extra of one things (which costs more) then trade.
I think this is diminishing marginal returns of consumption, not production.
Yes, diminishing marginal utility plus increasing marginal production capability is the recipe for specialization and trade.
I think I agree with Eliezer (if I read correctly) that scarcity is the underlying motive—trade is only valuable if you want something and you can trade for it more easily/cheaply than you can produce it.