how does greed contribute to the economy?

Answer 1

Supply and demand?

Answer 2

Greed is a common behavior shared by many people and transcends countries and cultures. The benefit of greed to the economy is defining a consistent and expected behavior or rule between two parties in any business transaction. This results in efficiency within the market. For example, if we were to take a trade negotiation. If both parties expect to either make or save as much money as possible, then at every change in tactic during the negotiation, one party can be safe to assume that other party's greed is the motivation. If at the end of the negotiation a deal is reached, and each party is equally skilled at negotiating and equally driven by greed, the terms of the deal will be most efficient solution. A balance of minimal concessions between parties to achieve the deal.

Another example, as a shareholder of a company, you would expect the company you invested in is trying to make every penny of profit it can, not leave any opportunity on the table or waste its resources. This requires due diligence and to think about every contingency where the other party may exploit. This results in the company being very efficient with it's resources. Any company which doesn't make the best of any opportunity, can and will be eventually be out competed by a greedier company which can make the best of the opportunity. As an investor that would not be desirable to invest in a company which can be outdone.

Answer 3

Greed creates more demand for goods and services which in turn boosts the economy.

More demand creates more production, more profits for businesses, more jobs and therefore a better economy.

If on the other hand the greed is for imported goods then this can negatively affect the economy (that is if the monetary value imports is greater than that of exports). In this case another country's economy will benefit.

Answer 4

"Greed is Good", that's a quote from the Michael Douglas movie "Wall Street." But greed is only good for those on top. It's good for the oil companies who make record profits when gas prices are at all time highs and the average Joe has to struggle to fill his tank. It's good for those who invest in stocks in Drywall, Lumber and Roofing material companies after a catastrophe like Hurricane Katrina but it's bad for those trying to rebuild their lives after wards. Greed drives up prices and profits. Only those at the top profit. When prices go up everyone else suffers. When most of the people suffer and the rich get richer, that is, supposedly, good for the economy, until so many people suffer that things crash, and even then, the rich will not be hungry or do with-out. They will somehow get richer while we get poorer.

Answer 5

raises the country's GDP, creates demand, supply has to keep up, jobs get created, opens more markets, more product diversity, competition among producers gears up, advertising/marketing increases, imports/exports may go either way depending on product/supply concerned, etc, etc. etc....

Answer 6

I gets me out of bed in the morning then sends me to walmart after working 12 hours to buy food clothes dvds beer.........