Repeat After Me: Life is a Non Zero Sum Game
What is success in an examination?
I give you two choices: scoring well, or scoring better than everybody else in the examination.
If you could choose only one of these, which would you choose?
Say you're waiting at a signal, and you realize that the signal that allows you to turn to the right will turn green later, while the signal that allows you to go straight is already green. You're in the rightmost lane, and you want to go straight. Do you wait in your lane, or do you try to cut into an adjacent one?
Say boarding has been announced for a flight. Do you try yo get in before everybody else, or do you follow the instructions by the crew?
Regardless of your answers, and regardless of whether or not you were honest will giving them, I'm fairly sure you and I will agree with what the modal response is likely to be.
Why does this matter? This matters because these are all zero sum games. In a zero sum game, you only "win" at examinations by defeating everybody else. Tennis, to cite just one example from sports, is a zero sum game. The only way Djokovic could have won that Wimbledon final was if Federer lost. Or take examinations. Winning is not about being good at the subject, it is about being better than everybody else.
In a zero sum game at a traffic signal, you "win" by making sure that you leave the signal behind you as quickly as possible, regardless of what happens to everybody else who is also at that signal.
The flight boarding example is left as an exercise for the reader.
What are zero sum games? Zero sum games are those games in which an interaction between you and somebody else (or you and a lot of other people) results in gains for you, but losses for the other(s).
And when you are part of a global culture in which you are taught from childhood that life is a series of zero sum games, you will view most things in life as a zero-sum game.
Including trade.
But just like life, so also with trade. Trade is a non zero sum game.
Again, because it bears repetition:
Trade. Is. A. Non. Zero. Sum. Game.
There have been two nice posts by economists I admire recently, here (check out the whole post, but especially Myth Two, also excerpted below) and here (again, the whole post is worth reading, but especially pts. 5 and 6, also excerpted below):
Myth two: Our trade deficit comes from other countries taking advantage of us
Become deeply entangled with our potential future adversaries. German gas imports from Russia are often cited as an example of the dangers of trade, and yet Germany was able to find alternatives after the Ukraine War began, while Russia paid a price in terms of lost export markets. The more integrated the US and Chinese economies become, the less likely it is that there will be a future war with China. The Taiwanese understand this, which is why they’ve chosen to make their economy deeply integrated with Mainland China.Encourage many more Chinese students to study in America, and vice versa. This also reduces the risk of war. The recent isolation of China has contributed to the sharp deterioration in relations. Most Americans, even most highly educated Americans, are shockingly ignorant of recent changes in Chinese society. Cultural change there is now happening at an startling rate, in the direction of what some call the “Japanification of China”.
The reason these posts (including this one!) need to be written, and the reason there is so much disastrous and tragic confusion about trade in the world today, is not because folks don't get that trade is a non-zero sum game.
Of course they don't get that trade is a non-zero sum game. But they don't get the life itself is a non-zero sum game. It is how we are brought up, it is how our world-view is shaped.
Winning, for us, means defeating somebody or something else. How have you won if nobody else has lost?
The failure is cultural. If we don't think of life as a non-zero-sum-game, of course we're never going to think of trade as a non-zero-sum-game.
And personally, if you ask me, the sooner we get around to spending more time on this problem - how to get all of us to realize that life is a non-zero-sum-game - the better it will be for all of us.