The Economics of Pineapple Pizza

Yes I’m serious there is sound economics behind this.

There’s this raging debate of whether or not pineapples belong on pizza which I think it does, but before you come after me with pitchforks let me explain how it even exists.

That slice of pineapple pizza wasn’t made entirely by your favorite pizza chain, and in fact it took thousands, perhaps millions, of self-interested people to create it. Let’s start with the manager of the restaurant that you ordered from. The manager had to order various ingredients like flour, pineapples, tomato sauce, cheese, and whatever else goes into making a pizza because he/she is self-interested and wants to make money. The farmer who grew the pineapples, tomatoes, and the wheat is also self-interested. Same goes for the person driving a John Deere to plow and harvest the wheat, and the workers who harvested the tomatoes and pineapples. Now, let’s break it down even further; the John Deere was designed by an engineer in the U.S., it’s steel parts were manufactured in China. The diesel, rubber, iron ore, were all refined by workers; additionally the workers needed food as well. Just think of all the millions of people that had a hand in raising the workers’ food!

I could go on and on about all the equipment and people involved in making pineapple pizza, but for simplicity’s sake I’ll stop here. By now you should get that countless numbers of people helped create pineapple pizza, yet not one person, business, or country is able to create one all by themselves. Each individual who had a hand in bringing the pizza to market has limited knowledge. In other words, there’s no master mind that can bring all of these people and resources together. It’s simply impossible and attempting to do so would be overwhelming, it’s akin to playing God.

Every single product or service, like pineapple pizza, is a result of the free market and every ingredient and labor that was put into it was prompted by spontaneous order. The idea of spontaneous order comes from Friedrich Hayek who defined it as a peaceful interaction of unregulated (non-government) groups of self-interested individuals with limited knowledge. This means that pineapple pizza appeared because self-interested individuals offered their tiny bit of knowledge to other people; it’s kind of like putting pieces of a puzzle together with each piece being a person who can do one thing well but not everything.

This is the beauty of it: We’re all interconnected without even realizing it, and the people who we might consider to be enemies are helping us. It transcends beyond borders, cultures, and economic classes and the entire order is headed by nobody, not even the government. It all comes together because of voluntary actions fueled by our self-interested motivations. This is proof that we do not need regulations to force others to do our bidding, neither do we need a planned economy as championed by socialists.

Read I, Pencil

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