How economy evolves

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An example how the economy evolves (Marga - why)- Here I have postulated four tribes to explain how the people’s economy originates, whom I shall call Volcano tribe, Craft tribe, Dairy tribe and Agro tribe. I shall pretend that they are centres of trade and each provides different basic necessities and skills. Volcano tribe is the centre in ore, the Craft tribe is the centre in wood and has skilful craftsmen, the Dairy tribe produces milk and the Agro tribe has agricultural products.

In the beginning, 1000 years ago, the tribes were struggling for their life and to protect their territories. The Volcano tribals were the poorest tribe. The rocky and volcanic ground could provide nothing to eat. They depended on the forest nearby for food. What made them settle down in this poor area is not known, but they blame the Craft tribals for their misery of not allowing them to use the lake. The Craft tribals lived at the other side of the forest beside the small lake. The lake provided them a meagre food supply. They were very skilful craftsmen in woodcarving, weaving grass mats, and in making bows and arrows. Since long ago they had bartered with the Dairy tribals, who lived on the lowland, with their cattle and sheep. They exchanged their tools and grass mats with them to get milk products. The Craft tribals’ grass mats were a necessity for the Dairy tribals. The Dairy tribeals’ nomadic life required mobility and simple construction materials. The Dairy tribals’ neighbour was the Agro tribals. There was a constant quarrel between them. No one knew the cause of their enmity. The Dairy tribals say that the Agro people are egoistic and selfish and the Agro tribals say that the Dairy people are uncivilised. Be that as it may there was much jealousy between them because of the Agro’s rich agricultural products. Because of this distaste the Dairy tribals hindered the Agro tribals from getting access to the Craft tribals’ craftsmanship and wood.


With this introduction we can imagine the condition and standard of the tribes. In those days the economic development was a spontaneous process. It was not like today when artificial supplies and demands are created. There was a need for survival and any new item or idea was happily welcomed.

How then did their economy evolve? Let us imagine that one day one Volcano tribe man and one Craft tribe man fight in the forest, at the boundary between the two tribes. The Volcano man takes a stone from his leader bag and throws at the Craft man. The stone is a heavy hunting stone. The Craft man responds by picking up the same stone to throw it back. But he stops in his attempt because he is a craftsman and becomes curious why the stone is heavy and red in colour. Instead of throwing it back he runs away. Back in his village he examines the stone and discovers its potentiality for iron making. He did not know that the stone was a peace of iron ore but he felt strong desire to get more. He knew the difficult life of the Volcano people, and planed to visit them. He took some food and some bows and arrows with him. With these goods he approached the Volcano tribals and traded them in exchange for ore. This become the starting point of their new relationship of developing an economy. The Volcano tribals need food and hunting materials and the Craft tribals need ore. A mutual relationship evolved between them. No friendship is shown except when trading. The iron tools of the Craft tribe begin to flourish. Their tools are exchanged with Dairy tribals’ milk products and edible grass seeds. This improves their livelihood but it increases also a danger. The Dairy tribals begin to misutilise the iron weapons to attack the Agro tribals. But this is stopped as the Craft tribe boycott the trading of weapons to the Dairy tribals because they have a good relation with the Agro people. The Craft tribals need the Agro tribals’ vegetables. This is how an economic “check and balance” can facilitate building strong social relationship between culturally different groups.

When the economy of the tribes began to grow it was spontaneously divided into an export-import economy on the one hand, and a local or internal economy on the other. But these two major divisions of the tribe’s economy was not static. As time passed, the tribes added many new items for export. All the new items came out of their own local economy. For example, Craft tribals manufactured wood boxes in which ore was carried down from its source. These boxes were sometimes bartered to Dairy and Agro tribals who came to exchange their goods for iron axes, knives, arrowheads, and spearheads. They found it useful to carry their tools and weapons in these practical and well-made boxes.

In the tribal economies a lot of imitation went on, but with positive results. For example, when the Craft tribals exchanged their wooden boxes for the baskets in which the Dairy tribals carried milk products, they began to copy those strong, elegant little baskets. By the time those boxes lost their demand by other tribals, the Craft tribals had already develop another small, compensatory export trade in imitated baskets. Not only had they expanded the number of craft items, but had provided more employment and, consequently, increased the living standard of the whole tribe.

In reality society doesn’t evolved from just a few tribes as explained above, but from all the many minor tribes and groups in the existing environment. When the economy of the four tribes grows, the people of the other minor tribes, and people of the small hunting groups, will naturally resent the encroachment upon their own territories by this newly formed trading economy. In order for the trading economy to grow smoothly, the major tribes will have to include all the other groups in their trading scheme. If they don’t, then passage through the land of these smaller groups will surely be blocked. This effort to include everyone in the trading scheme will ensure that as the range of customers extends outward, so do the routes to the trading centres (the four tribes), thereby forming a communication and transportation net work that stretches for hundreds of kilometres in all directions.

Before concluding this story, let me describe more about the economic development of the Craft tribe. Because of the tribe’s unusually voluminous and extensive trade of iron, large quantities of food flowed into their village. Especially non-perishable plant food like beans, nuts and edible grass seeds, were easy to handle and traders carrying it could travel more swiftly. The imported food promptly entered the local economy and came under the custody of the local workers who were specialised in its protection, storage and distribution. They were, in effect, stewards. The stewards were intelligent people and fully capable of solving problems and of learning from experience. The stewards made an effort to keep fresh food always on hand and, in particular, always to have some for the happy and exciting occasion when a party of traders returned from afar, weary, hungry and eager for welcome.

Gradually, the tribe grew more and more of its own food but it did not, as a consequence, wallow in unwanted surpluses of imported food. The tribe’s total food supply was made up of its own collective territorial harvest, its imported foodstuffs, and its fresh home garden grown food. In this way the total food supply continued to increase but the imported foodstuff decreased as the tribe’s home-made food greatly increased. The tribe, in short, became self-sufficient in food. The same happened with other items like the imported baskets manufactured locally so they no longer needed to be imported. The tribe thus experienced a tremendous economic change: explosive growth owing to local production of goods that were formerly imported.

Knowingly or unknowingly all the tribes and groups were aiming for their self-sufficiency in basic necessities like food, cloth, tools and construction materials. A complete self-sufficiency as a single tribe or group, would not have been possible because all raw materials are not available in one place. But as an economic zone where all materials are within an reasonable area and through continuous co-operation with the other tribes and groups, it could have become possible.

This illustration of the tribes shows how the people’s economy evolves when dealing with the basic necessities. When there is a common need for these items. When individuals take the initiative to find the means to improve their life and then allow a structure to evolve to handle the production and distribution. The employment increases. Some persons get involved in cultivation, others in production, and still others in retailing and storage. The people’s economy becomes very complex. Its success depends on a strong administration. To deal with the essential needs of the people. To develop small-scale industries. To make polices benefiting the local and export-import economy. And to maintain a moral stand.

Rasatmakananda (1997)