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by kbutler 2365 days ago
No, differential preferences make free exchange a positive sum game (economic surplus/gains from trade). Emergent properties can magnify the value, but are not necessary.

The apple farmer sells apples because (he considers) the money is worth more than the apples. Consumers buy apples because (they consider) the apples are worth more than the money.

  My perceived benefit - my compensation to you > 0 (I win = consumer surplus)
  My compensation to you - your perceived cost > 0 (You win = producer surplus)
If either one of those is not true, no voluntary exchange takes place. In compelled exchange, only the first needs to be true. This takes various forms, including taxation, robbery, and slavery.

Note that those two equations are from two individual perspectives - I determine my benefit, you determine your cost. If you simplify to "benefit > your cost" and compel the exchange, you get a dystopia - compulsion "for the benefit of all/others/king/etc.", without realizing the full costs to those compelled to sacrifice. Voluntary exchange is required to allow each individual to determine their own benefits and costs.

Note also that this incorporates transaction costs inside the "benefit" or "cost". See https://en.wikipedia.org/wiki/Coase_theorem for more info.