WEBVTT

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The astonishing growth in prosperity in
the last two or three hundred years

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is one of the greatest events of
humankind. Take the average human in say

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the year 1000 BC. He's poor, fighting to
find food

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and to fend off diseases. Fast forward 500
years to the time of classical Greece.

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Still poor still hungry. How about another thousand years after that?

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It's the dark ages. Wow. Still poor.

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Then jump to the 18th century and forward. Things change rapidly.

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This phenomenon is known as the hockey
stick of human prosperity. Take what is

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surely one of the most important
measures human well-being:

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life expectancy. Before the Industrial
Revolution

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life expectancy was around thirty years.
Today

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in the United States we expect to live
to be about eighty.

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Prior to the industrial revolution one

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in four kids would die before the age of 5.

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Today in developed countries it is more like
one and two hundred.

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Due to better nutrition we grow to be
four inches taller

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than we were just two hundred fifty years
ago.

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Remember this disease? No you don't, because
it was eradicated in

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1977. Look around--you'll find a roof over
your head

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and a hard floor under your feet. Most of
our ancestors with the huts with dirt

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floors and thatched roofs.

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Everything was infested with insects and
rodents.

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Streets and alleys were open sewers.
There were none of these.

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The filt was horrible and often toxic

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Our ancestors ate gruel and wore the same
home-made underwear

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over and over. Now even the least
fortunate Americans

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typically have electricity running water
toilets

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refrigerators televisions and yes cheap

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washable underwear. Those of us who live
in modern industrial society

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are incredibly, amazingly, off the charts
rich

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compared to our ancestors and here's yet
another huge difference between us

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and our ancestors. Before the Industrial
Revolution

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people knew how to make from scratch many
other things they consumed.

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They made a lot of their own clothing
grew most to their own food

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and build their own dwellings.

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Fast forward to today and believe it or
not

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none of us is a hint how to make the
majority of the things that we consume.

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Just getting ready in the morning
involves taking many trips around the

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globe.

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Take this coffee for example beans come
from

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Guatemala and they were brewed in this
coffeemaker from Switzerland.

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The container ship that carried the
beans was built in Korea.

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It's insured by a company from London and
it's captained by Frenchman

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who loves Turkish cigarettes. We've
transitioned

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from each of us doing many things to each of us doing one thing.

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Having a job only makes sense in a modern
world

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where each individual typically does only
one type of work.

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So while we mostly only produce one
thing

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doing one job each of us now consumes a
whole bunch of products

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that require a whole bunch of jobs to
produce.

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The question where prosperity comes from
launched the field of economics.

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It's why Adam Smith wrote the first book
in modern economics.

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An inquiry into the nature and causes of
The Wealth of Nations.

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Back in 1776 when he published it

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Smith was trying to understand the
causes of modern prosperity that were

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just starting to appear.

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Poverty and starvation were still normal as
they had been from the beginning

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but in the late 18th century for the
first time ever

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the masses began to enjoy riches once
reserved

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only for the nobility. It is this mass
prosperity that Adam Smith

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sought to explain. Why was it happening?
What was causing wealth to move from being

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the exception

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to being the norm. Now look around try to
figure out what causes poverty

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instead of what causes prosperity. You are
watching

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Everyday Economics, a course where we use the
lens of Economics

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to explore everyday questions. This
section is about

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trade. In the upcoming videos we will attempt
to explain how trade

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plays a role in our prosperity. You also
get to decide where the course goes.

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Maybe you have some questions related to
trade that you've wondered about.

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We'll cover the basics and then you tell
us what topics come next.

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