Whereas in isolation, man produces what he needs, in a social system, man produces based on what he expects others to need. He need not meet the full diversity of all his needs through his own labor and can instead direct his labor to the areas of production in which he can excel most at serving others. By specializing in producing a good for a market, rather than producing for your own consumption, it becomes possible to dedicate labor toward the place where it is most productive, not where it is merely necessary. In a market economy, your needs are best met indirectly, by using your abilities to specialize in what you do best and exchanging it for the goods and services produced by others. Specialization is therefore another way of increasing productivity. Beyond just an increase in productivity, trade leads to social cooperation and civilized behavior, as the benefits of being able to engage with society peacefully in a division of labor are very high.
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