How can the wealth of the world increae? Where does the money come from??

Answer 1

Wealth is not finite: new wealth is created every day. Any time one person creates something of value for another person, if the value of that product or service is greater than the cost of the time and resources to create that product or service, then wealth has been created (if it is worth less though, then wealth has been destroyed).

Often such value is created by manipulating natural resources, or just rearranging natural resources in complex ways (building a house). But increasingly, value creation comes from highly abstract workings of the mind.

That value-creation stuff is pretty abstract, but money is a tangible thing that serves to capture this "created value" so that you can store it and benefit from it later.

New money is created over time to reflect the fact that value-creation continues to occur. Money-creation is not the same thing as wealth-creation, but the two things are linked. Even when societies crudely relied on gold coins as money, new gold coins were always being minted by governments as new gold was extracted from the ground.

A healthy economy must have processes to peg money-creation to value creation, or else the money system will be dysfunctional. That is why if you go to a bank to borrow money, you usually have to prove that you have income (you're creating value for someone) in order to get a loan.

Money also lets us quantify and COUNT value creation, which is very important. This, along with free markets and pricing systems, let's us know whether we are creating or destroying wealth; and encourages to create value rather than destroy it.
One reason the Soviet Union went extinct is that it habitually destroyed wealth until it imploded, because it foolishly used a communist economic system that eliminated these important signals of value creation.

Answer 2

Wealth is as the other fellow said created by productive work. When Iron and Aluminum are dug out of the ground and refined they are obviously worth more than the raw ore in the ground. Likewise then they are rolled formed into parts and made into a bicycle a car hospital bed or whatever they are worth more than slabs of material.

Answer 3

wealth comes from productive work.

you could sit around, instead you go and make something useful. Then you exchange it for something you like even more (even if exchange happens through money). You're better off than you were before.

It is true that some resources (land, minerals) are limited. But technological progress means we can get more stuff out of same resources.

Answer 4

Most wealth is not held as money, it is held as assets that generate income (stocks, bonds, etc), or as personal possessions (houses, art, jewelery etc) that could be sold for money, but usually are not. Wealth increases when businesses grow and build more factories or become more efficient, or new technologies create new businesses increasing income. Even building new houses creates more wealth.

Answer 5

The "Wealth of the World" is a finite quantity. The only unknown is the impact based on how it is distributed.