> [!summary] Progressive Summary # Structured Notes ## Definitions ## Chapter Summaries ### Chapter 1 - From Adam Smith to Tim Cook A business can be seen as a series of trade relationships. A factory owner buys raw materials, passes it to a worker to make some modifications, who then passes it to another worker to make further modifications, and so on, until a finished product is ready to be sold. What Adam Smith understood about a single pin factory (that specialization could make workers a thousand times more efficient), David Ricardo expanded to include entire trading blocs of nations. Smith published *Wealth of Nations* in 1776. Ricardo wrote *On the Principles of Political Economy and Taxation* in 1817. --- - Write note on capital bias - Ricardo said that "the rate of profits can never be increased but by a fall in wages." [[Wealth Supremacy]] --- 200 years ago, people traded in raw materials or finished goods, but not intermediate goods or services. Communications and transport - carrier pigeons, horses and sailing ships - were not advanced enough to handle complex coordination. Ricardo used an example where the Portugeuse were superior to the English at both textiles and wine-making. He argued that rather than doing both, they should focus on the one where they had a comparative advantage (wine-making), and let the English do the other. By t ### Chapter 2 - The Growth of Global Finance Trade moves goods across space. Finance moves purchasing power across space and time. # Quotes