Economics Is Everywhere
How all of life is shaped by the fundamental equation of cost versus benefit
When economics is taught in academia it generally focuses on the narrow topic of exchange. Theories of value are discussed, general ideas such as comparative advantage are presented, and students ponder over asset-pricing models and balance-of-trade considerations. Which is lovely, but it’s like treating the mechanisms of evolution as though they only applied to the genes of fruit flies. When we step back from the conventional way of thinking about economics we discover that it sheds light on why things are as they are across all of nature.
All organisms from the simplest single-celled bacterium to the bipedal ape we misnamed homo sapiens have to solve one fundamental problem above all others: how much of one’s extremely constrained energy supply does one put into a particular adaptation? Just as in an ideal world we’d all have multiple mansions and countless private jets and an endless array of expensive status-advertizing items like supercars, yachts, and trophy partners so too in an ideal world creatures could invest in a wide range of traits that have minimal utility. After all, one can only live in a single mansion at any point in time and only sip champagne in one private jet in any given moment. Moreover the running costs of vast mansions and a…
