I'm rereading a book that really liked me, entitled The Company of Strangers by Paul Seabright . In the first few pages (available in English here ), the author describes market which helps explain why economists are all fascinated by its functioning (attention, it has nothing to do with "being fanatical market" or with some form of neoliberalism ). I offer you a free translation of the first three pages and I encourage teachers to read it to students in economics.
The Needs of World Population Shirts
This morning I went out and bought a shirt. There is nothing very strange about that: on the planet, perhaps 20 million people doing the same thing today. What is more surprising, however, is that, like most of the 20 million other people, I tell anyone that I intended to do. Yet, this shirt, although rather basic in terms of achievements of modern technology, represents a miracle of international cooperation. The cotton grown in India, from seeds developed in the United States; artificial fiber present in the son comes from Portugal and the components that allowed the manufacture of dyes from at least six other countries, the lining of the cervix from Brazil and the machines that were used in weaving, carving and sewing from Germany; the shirt itself was made in Malaysia. The project which led to make a shirt and deliver it next to my home in Toulouse was planned long, long before this day two years ago when an Indian farmer began plowing his land on the red plains near Coimbatore. Cologne engineers and chemists in Birmingham were already involved in preparing many years before. The most surprising is that despite all the obstacles he had to overcome to make this shirt and given the very large number of persons involved in this process is a beautiful and stylish jacket (on the scale that can express my opinion in this area). I am extremely happy with the result. And yet, I'm pretty sure nobody knew I was going to buy a shirt of this type today, myself, I did not know the day before. Each of the fibula, which has worked hard to make sure I get this shirt did not know me and not worry about me. To make the task even more difficult, they (or other workers almost similar) also had to work to provide shirts and 20 million other people very heterogeneous in terms of sizes, tastes and income, and dispersed across six continents, who decided independently of each other to buy a shirt at the same time as me. And that is just for customers today. Tomorrow there will be 20 million more, maybe more.
If there was one person responsible for providing shirts for the entire world population, the complexity of the task that it would take the size of a battle or war. One can imagine the president of the United States who were present a report entitled The Needs Shirts World Population . He trembled reading its contents and would immediately set up a crisis unit. The United Nations Conferences on ways to improve international cooperation in the manufacture of shirts, and there would be debates as to whether it is the United Nations or the United States should lead the operation. The Pope and the Archbishop of Canterbury initiate a call to unite to address the needs of the planet and religious personalities and stars of the song remind us regularly that can wear a shirt is part of Human Rights. The humanitarian organization Tailors without Borders airlift of aid to clothing the poorest regions. Experts would be interviewed to discuss the merits of making passes in Brazil for shirts made in Malaysia and then re-exporting to Brazil. Other experts would argue that reducing the diversity of styles of shirts, wasteful shameless, it could greatly increase the total number of shirts produced. Plants that have achieved the productivity gains the most spectacular in the manufacture of women would receive awards and their leaders would be interviewed on television. Militant groups claiming that manifest the "folders" are sexist and racially connoted clothes and suggest other more neutral clothes like blouses, tunics, and a whole myriad of other items that are worn above the waist. The Chronicles of different newspapers discuss priorities and needs. In this general cacophony, I wonder if I could still buy my shirt.
In fact, nobody is responsible to take care of everything. This process titanic which provides thousands of shirts in different styles to millions of people takes place without anyone being in charge of coordination. The Indian farmer who plants the cotton is only interested in the price at which a trader is willing to buy his production, raw material cost and effort required for harvest. The managers of the German company that manufactures the machines are concerned that export orders and their relationships with suppliers and workers. Manufacturers of chemical dye can not be less interested in the design of my shirt. Although some parts of the process require explicit coordination: a large firm like ICI or Coats Viyella has several thousand employees working directly or indirectly under the command of a CEO. But even the largest companies have only for a very small share of the overall production of shirts. In general, nobody takes care of the overall process. Sometimes you plague against the system and wondering if it works as well as it should (I had to replace the broken buttons of my shirt a little too often). But it is already extremely surprising that the system works.
citizens of industrialized countries with market economies have lost the ability to marvel at the fact that they can spontaneously decide to go out and find food, clothing, furniture and thousands of Other useful items pretty, frivolous or that can save lives, and when making that decision, someone will have already anticipated and made these properties available for purchase. For our ancestors who roamed the plains in search of game or scratching the earth to grow seeds in a capricious sky, such a prospect would have seemed miraculous, and the possibility that this can happen without some understanding of invervention to coordinate everything would have seemed incredible. Even when adventurous travelers have opened the first trade routes and that the citizens of Europe and Asia have had for the first time the chance to share their wealth, he had still a good dose of luck hope to reach port, so much so that it was a source of inspiration for the theater until the time of Shakespeare. (Imagine The Merchant of Venice in a supermarket).
In Eastern Europe and the countries that belonged to the Soviet Union, even after the collapse of the centralized economy, people could not understand how a society can aspire to prosperity without planning. About two years after the end of the Soviet Union, I met a Russian bureaucrat who was previously responsible for organizing the production of bread in St Petersburg. "Understand that we are quite ready to transit to a market economy," he said. "But we need to understand the basic elements that make this system work. For example, tell me who is in charge of the bread supply in the city of London?" There was nothing naive about this question because the answer ("no one cares"), when you think about it, is incredibly difficult to believe. Only in the industrialized West we've forgotten how strange it is.
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