Economic Wisdom to Apply in Your Twenties

Chapter 4 Prologue
Prologue Section 3 Learn economics well and gain a "comparative advantage" in life

The best advantage we have in our twenties over our thirties and forties is youth.Twenty-somethings are open to possibility and full of hope for the future.

But being young is both an advantage and a disadvantage. We in our twenties have low income and do not have much capital accumulation; we in our twenties are not deeply involved in the world and lack social experience.Therefore, when young people in their twenties enter the society, the first thing to consider is how to give full play to their own advantages, maximize their strengths and avoid their weaknesses, and cultivate their competitiveness.

Just as Korean financial expert Kim Yong-ho said: In your twenties, the top priority should be to study economics.For asset management, successful employment, and career success, everyone must first learn economics well.

Those who have an understanding of economics may know that there is a concept in economics called "comparative advantage".And we believe that studying economics is an effective way to gain a comparative advantage in life.

Comparative advantage first originated in international trade. It means that the opportunity cost (measured by other products) of a country producing a product in its own country is lower than the opportunity cost of producing the product in other countries, so the country has an advantage in producing the product. Comparative Advantage.Comparative advantage was proposed by David Ricardo, a master of British classical economics, in his book "Principles of Political Economy and Taxation" in 1817. Later, it broke through the limitations of international trade and was widely used in the comparison of various competitions and cooperations. .Such as economic cooperation among industries, ability comparison among job seekers, and development ability comparison between companies, etc., the principle of comparative advantage can be used in any places where comparisons and differences may occur.

The famous American economist Paul Samuelson once said: "The most beautiful theory in economics is comparative advantage." From an economic point of view, if a country, a region, or a system wants to seek effective survival and In order to have room for development, we must give full play to our comparative advantages.Whether it is an individual, an enterprise, or a country, as long as you stick to your "comparative advantage", you can obtain the greatest utility benefit for you in cooperation and competition with others.

Understanding the principle of comparative advantage will help us make correct decisions in life. How to make yourself more professional and how to make use of your comparative advantages is up to you in running business, choosing study subjects, and even in love. must be considered.And studying economics itself is a process of forging comparative advantages for oneself.

Economic principles are the most important cornerstone of this society and the driving force behind dominating the world.Therefore, understanding the common sense of economics is a necessary skill to live in this world.Only by understanding the economy can we better understand and learn knowledge in other fields.Familiarity with economic principles will guide you to look at problems in other fields with a more intelligent perspective, and your comparative advantage will naturally become larger and larger, forming the "Matthew Effect" that we will introduce in later chapters. That is to say, the strong get stronger and the weak get weaker.We are not sure that studying economics will make you a rich man immediately, but at least it will give you a peaceful old age and a more rational attitude towards life.

From now on, if you want to gain a comparative advantage in life, start by studying economics!

(End of this chapter)