Are You a Vegetarian?

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Buchanan: We're part of a small group of hunter gatherers who are living in very primitive subsistence conditions. He says we get all our food from hunting and could do some gathering as well, i suppose. Buchanon: You can bang your neighbor on the head and take his meat. In that way, you can get moreYou can develop a technique that allows you to be a more successful hunter for every hour or day that you "re out in the woods"

Russ Roberts, host of EconTalk, does a monologue this week on the economics of trade and specialization. Economists have focused on David Ricardo's idea of comparative advantage as the source of specialization and wealth creation from trade. Drawing on Adam Smith and the work of James Buchanan, Yong Yoon, and Paul Romer, Roberts argues that we've neglected the role of the size of the market in creating incentives for specialization and wealth creation via trade. Simply put, the more people we trade with, the greater the opportunity to specialize and innovate, even when people are identical. The Ricardian insight masks the power of market size in driving innovation and the transformation of our standard of living over the last few centuries in the developed world.