Understanding the concept of “gains from trade” is crucially important. So much so that Tyler Cowen lists it as #3 on his list of the big ideas of economics. Gains from trade helps explain how and why markets work -- and why both parties involved in trade benefit.

You can purchase a meteor shower in Japan, you can pay to take a nap in a mattress store in New York City, you can pay to do a virtual reality simulation of your own death in China, and you can spend thousands of dollars on clothes for your pet...all made possible by gains from trade! (Tip: For more whacky examples of gains from trade, check out the Markets in Everything posts on Cowen’s blog, Marginal Revolution).

Learn more about how gains from trade affect our day-to-day choices and interactions. And stay tuned for more videos in this series, Tyler’s 9 Big Ideas of Economics, released weekly!

Cowen delivered this talk at the 2018 AP Economics Conference co-hosted by MRU & the St. Louis Fed. If you’re a high school teacher that wants to attend this conference next year, register here: https://bit.ly/2DozLzv

Or join MRU at a future economics teaching event! Visit this page for more information: https://bit.ly/2AQIWq5