One of the key ideas in modern economics is the idea of scarcity. In fact, sometimes economics is defined as the “allocation of resources in the context of scarcity.”
Scarcity means that there is not enough to go around. If everyone had access to everything they desire, there would be no economics. There would be no need to determine how to allocate resources. At least that is one view of the field of economics. This notion of scarcity, however, is a bit more complicated than it might appear.
If you want to prove capitalism works, you might think back to 18th century Glasgow. That’s where Adam Smith was when he created the theory of market capitalism – he looked around, saw open markets, saw competition, saw the industriousness and prosperity that resulted, and correctly concluded that a system of free markets based on competition benefits everyone.
Everyone, that is, except the slaves.
Because what Smith’s famous example leaves out is the fact that Scotland’s prosperity was the result not just of free markets, but of slaves in the Americas producing tobacco that could be shipped to Scotland for processing. Without the slaves, the system wouldn’t have worked. To read more click here
