Tale of Tarot and Raw Fish —— Economics Written for Ordinary People (Part II)

It is said that Robinson was thrown to a desert island in Hawaii by the wind and waves, surrounded by the Wang Yang, and several giant sperm whales in the distance sprayed the sea water to a height of 15 meters, watching the spray drift away with the wind, and he was very happy. Robinson was so hungry that he had to

taste a hundred herbs, trying to find any plants that were edible and non-toxic.

a month has passed. Robinson has long adapted to the "single" life on a desert island, and cultivated a large tarot manor behind a thatched cottage

, which is the taro native to Hawaii. This thing is like a starch pimple. At noon every day, when the sun was blazing, Robinson began to "cook": first, he dug a pit two meters wide and one meter deep in the ground, and then took out some pebbles that had been burned all night from under the fire in the house and placed them at the bottom of the pit, with two taros between them. Cover the pit and wait for two hours. When smoke slowly comes out from under the soil, take out the "Tarot" and eat it in the skin. I don't know how many days have passed, and Robinson can't remember how many times the sun and the moon have alternated. One morning, God knows if it was Friday, so the most important event in the history of commodity exchange in Hawaii happened

. From the dense fog by the sea, the man who was later called "Friday" by Robinson shook his two bright red "sloppy" fish excitedly while wiping the bitter sea water on his lips, and bumped into Robinson who had just got up and stood at the door of the hut

. Speaking of it, the kind of fish called "sloppy" is extremely delicious and can be called the best in all kinds of food in the world. Robinson himself has caught "sloppy", but the number is very small, so that there is only one "sloppy" after every ten "tarot" in his diet. Obviously, "Friday" is familiar with the habit of "carelessness". It seems that he can always find schools of fish, and he has extraordinary skills. Every time he dives, he must catch one in one hand before landing. In fact, I don't think much of Robinson on Friday. First of all, the white man's skin will never be tanned, and he is not born to live on Hawaii! Secondly, look at the way he got into the water. It's strange how he can

eat one sloppy tarot for every ten. Finally, although the white man is not short, he is shorter than the pure indigenous Friday in Hawaii, which shows that he is more calculating than Friday. ? ［1］?

([1] See Wang Dingding's long reportage "Captain Cook's Death" and "Aestheticism", No.2, 21 for a detailed argument. )

Yes, Robinson is more calculating. In his eyes, Friday is undoubtedly the most suitable "trading partner". On the earth, two people can form a "smooth market". It's called "duopoly" market, which is much better than no market. Robinson casually drew an analytical diagram of the transaction between two people on the beach (see Figure 1). He didn't care that Friday would see through his mind. It is estimated that he didn't even know the "rectangular coordinate system", what's more, Friday < P > spoke Hawaiian, and Robinson used authentic English.

the trade process shown in figure 1, in the lower left corner, is Robinson's position, and in the upper right corner, is it Friday's Li Chang? Both of them

live on two things: tarot and raw fish (the best way to eat carelessly is to eat raw). Both of them have a set of equivalent utility curves called "indifference curves" by economists, and moving along this set of curves in the direction of arrows represents the increase of utility. Although Robinson is well versed in such oriental wisdom as "a child is not a fish, knowing the pleasure of a fish", for the sake of the current trade benefits, it is better to assume that the set of equivalent utility curves before Friday have the same < P > shape as that before him (economists call it the same "preference").

Now, Robinson must estimate how much tarot and sloppiness he and Friday can produce each week, and he shows these estimates in this trading diagram which is regarded as "Bible" by future generations of economists (see Figure 2).

According to Robinson's estimation, 4 sloppy fish and 2 tarot fish can be caught every week on Friday. What about himself? Can be

to catch 1 careless and collect 8 taros from the "manor" behind the house. In other words, two people produce 5 sloppy and 1 tarots every Monday. Point a in figure 2 shows their respective parts in the total product of the "two-person club".

next, Robinson found the only one of the indifference curves on Friday that passes through point a, that is, the equivalent utility curve connecting point a and point b in figure 2. Why is this equal utility curve particularly important to Robinson? Because Friday can enjoy the "effect" represented by this curve without exchanging anything with him? Use "? (Note that this equi-utility curve passes through point A, that is, 4 sloppy fish and 2 tarot can bring the utility to the star < P > period five). Robinson knows that he can't compete with Friday physically, so "extortion" is not one of the "optional behaviors" at least at present. Then, the only alternative behavior left is to say that

Friday is the kind of exchange that is beneficial to both sides. Obviously, this kind of exchange must improve the utility of both sides at the same time, that is to say, Friday should be able to increase its utility from the curve of equal utility < P > passing through point A to the direction indicated by the arrow on Friday's position in Figure 1. At the same time, Robinson should also be able to increase the utility from his own equal utility curve passing through point A (that is, curve IC in Figure 2 < P >) to the direction indicated by the arrow in Robinson's position in Figure 1, for example, the highest possible utility, for Robinson, of course, is the equal utility curve passing through point B < P > (that is, IC' in Figure 2). Robinson can't expect to trade without sharing any benefits on Friday, so the final transaction must make the equal utility curves < P > of both parties lie in the "fisheye" area surrounded by the equal utility curve passing through point A on Friday and Robinson's equal utility curve passing through point A, which is like the big eyes of a careless fish. For example, at point C shown in Figure 3, the utility curves of both sides are just tangent-that is, the two curves only intersect at one point. From point C, Robinson knows that he can't further increase his utility, because it will reduce the utility of Friday, that is, the utility expressed by switching the occupied equivalent utility curve through point C on Friday. Similarly, Robinson knows that Friday will not require a further increase in utility from point C to point D in Figure 3, for example, because that will reduce the utility that Robinson < P > gets in the exchange (that is, Robinson's equal utility curve passing through point C). In this state (point c), it is obvious that neither side will ask for further exchange (or not exchange). This is called

"equilibrium" state in economics.

Robinson and Friday became friends-"trading partners", although they still "dislike" or "despise" each other. Robinson heard from the Scottish doyen: "Is the market smooth? It is possible to educate people into "gentlemen" with education, morality and reputation. What a wonderful "market"? Ah, it not only brings higher utility to both of us, but also makes us stop killing each other. Robinson sighed so much that he sank into the dream country of Hawaii again ...