A brief introduction to "Small Island Economics"

This book uses a small island as a model to gradually narrate, which can show the evolution process of a country or a region's economy from scratch, from small to large, in a concise and clear way.

There are three people living on a small island in the ocean. These three people rely on the most primitive fishing to make a living. Each person can only catch one fish per day. At the same time, each person needs to eat one fish per day, so they are just self-sufficient.

Not long after, one of the young men with a relatively big imagination, Albert, began to wonder if he could make a fishing net to improve work efficiency. He spent a day that was also a day of starvation (this was the risk he had to take), made his own fishing net, and relied on the fishing net to catch two fish every day!

Our Albert continued to use his imagination. He also lent the extra fish to two other people so that they could spare their energy to make fishing nets. However, after the fishing net was completed, he had to return two fish to him.

Such a small change has improved the productivity of the entire island.

Because there is more demand, they have increased production capacity. After increasing supply, the island's economy can develop more rapidly.

The three people on the island lived a very happy life. People in other places were very envious when they saw how happy the three Bakers were.

Slowly, more and more people chose to immigrate to this small island, and many new occupations appeared on the island, such as construction workers, carriage manufacturers, etc. Because everyone eats fish and recognizes the value of fish, fish gradually acts as currency and can be stored.

At this time, another entrepreneur with greater imagination appeared on the island named Max. He discovered the business opportunity behind the fish and opened a company that was revolutionary at the time, called a loan company. .

It has the nature of a bank, allowing deposits and loans. Once launched, it has been warmly welcomed by the residents of the island. The business is very good, and the profit is also very good.

Max, who became a rich man, was not idle either. He invested the money he earned one after another in some large projects. As a result, the island's infrastructure became more and more perfect, and its economic development also became more and more perfect. The better come.

The book believes that what really promotes economic development is savings, not consumption. Only when people save money can social capital be pooled for beneficial investments.

As there were more and more people on the island and more and more money, invaders from other islands would appear from time to time, so the island decided to establish a government and named it Mesonia, and The Federal Reserve Bank of Fish was set up to be responsible for managing fish.

Although the leadership team has changed one after another, every newly appointed head of the Federal Reserve Bank seems to have agreed upon it, encouraging everyone to consume and buy as much as they want! At the same time, it also did business with another country called the Zhongdao Empire. Because labor was cheap there, they moved many industries there.

Until one day, the Nakajima Empire became self-reliant and no longer relied on Mesonia. They were so rich that they even bought all the core technologies and good products of Mesonia with their banknotes.

A country's economy will not grow because of people's consumption, but economic growth drives people's consumption.

The whole book uses vivid metaphors, starting from the journey of three people on a small island to get rich. Transform various blunt economic relationships into interesting stories. It vividly describes the emergence and development of the economy, the problems it brings, the government's methods of solving problems, and the problems caused by policies. The most essential principles of economics are always running through the book, which is thought-provoking. Worth reading for everyone.