> The economy is not "a pie", because it's not a zero sum game. The pie can grow, leaving more for everyone.
The interesting question is: what causes the pie to grow?
There is really only one thing that can fundamentally increase the size of the pie and that is natural resource income. The other thing that increases the virtual size of the pie is improving the efficiency of converting natural resources to things people want (standard of living).
It's also important to remember that after natural resource income (mainly energy) the next economic fundamental is food, housing, and basic utilities (heat/water/sanitation/electricity).
Workers are required to convert natural resources to improved standard of living. But workers also have wants and needs.
Generally, productivity is a better match to a country's wealth than natural resources. Certainly, at some ultimate level, things depend on the latter, but what you make with what you've got seems to matter far more in practice. That's one of the reasons a country like the Netherlands is rich despite not having a great deal in the way of natural resources.
> Generally, productivity is a better match to a country's wealth than natural resources.
It's not an either/or question. The natural resources are still the foundation of the economy, even if you don't gather them directly yourself. And in the Netherlands I suspect a very important natural resource for the local economy is land. I don't have time for research at the moment but I would guess that simply to live in the Netherlands is very expensive.
The interesting question is: what causes the pie to grow?
There is really only one thing that can fundamentally increase the size of the pie and that is natural resource income. The other thing that increases the virtual size of the pie is improving the efficiency of converting natural resources to things people want (standard of living).
It's also important to remember that after natural resource income (mainly energy) the next economic fundamental is food, housing, and basic utilities (heat/water/sanitation/electricity).
Workers are required to convert natural resources to improved standard of living. But workers also have wants and needs.