The fundamental mystery of capitalism, in my mind, is how a lot of locally zero-sum fights—over customers, over bread, over a job opening—can result in a globally positive-sum game like 2%/year economic growth over a century.

30 years of economic growth in a narrow corridor by ed leamer ... you can get pictures of the centuries on angus maddison or longer us economy on economagic

Just had a small maybe-insight into this question. Let’s take the case of a negative-sum court battle where the victim of a rollercoaster accident tries to recover damages in court. What’s being negotiated, at expense, is the transfer of wealth from one party to another—no growth here.

But, this suit constitutes a sample from the probability space of tort losses. The threat—in probability space—with low probability, of high expected loss—incents theme parks to take more precautions.

Maybe the precautions taken in response to the probabilistic threat are what causes the growth.

Agree? Disagree? Missing a wider point? On the right track?

About isomorphismes

Argonaut: someone engaged in a dangerous but potentially rewarding adventure.
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