3 ms·
Every time one of the red countries does business with the grey countries, there's conversion deadweight.
by danneu 14y ago
Every time one of the red countries does business with the grey countries, there's conversion deadweight.
- frogpelt 14y agoWe should all have one currency too, then?
- jzwinck 14y agoOf course not: sovereign currencies have well-known benefits. Multiple systems of measurement are only a hindrance, a friction.
- Thrymr 14y agoThe friction of unit conversion is much lower, though, because they are constant and don't have transaction fees. The number of centimeters per inch or pounds per kilogram is the same today as it will be next month or next year.
- userulluipeste 14y ago...actually NASA proved that kind of friction to be very severe: http://articles.cnn.com/1999-09-30/tech/9909_30_mars.metric_1_mars-orbiter-climate-orbiter-spacecraft-team http://articles.cnn.com/1999-09-30/tech/9909_30_mars.metric_... Just think that it also could have affected people...
- dhosek 14y agoActually, that's the reason that most international trade is done in dollars.
- sp332 14y agoCurrency is backed by different governments, and they have different risks, rates of inflation, etc. We're just talking about measuring things.