Is someone else getting poorer when i make money?

richest-and-poorest

Imagine a two-person economy. You fish, and your friend Fred cuts down trees and chops firewood.

You catch fish with your bare hands. You catch 2 fish per day. You trade one of your fish with Fred for 10 pieces of firewood.

One day, in lieu of catching your fish, you decide to build a net. This net allows you to catch five fish per day.

You could continue trading one fish to Fred to get 10 pieces of firewood. Fred is no wealthier or poorer than he was before you created the net, however you are much wealthier.

You decide to being trading 2 fish to Fred in exchange for 15 pieces of firewood.Since Fred now has more food, he feels stronger, and is able to cut down even more firewood for himself and trade with you.

Both you and Fred are far wealthier, and no one else is poorer.

Productivity is not a zero sum game.

Thanks Quora user Howie Reith Answer.

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