Most "wealth" is just government regulations. Property is the prime example.
Imagine you own an empty block of land. If it is zoned that no building is allowed, it is almost worthless. But if you are allowed to build a house it worth much more. The only difference is government regulations.
If you are allowed to multiple homes or an apartment block then you land is worth much more.
Tk : DR - Over 80% of real estate value creation is changes in land use.
Comments
Most "wealth" is just government regulations. Property is the prime example.
Imagine you own an empty block of land. If it is zoned that no building is allowed, it is almost worthless. But if you are allowed to build a house it worth much more. The only difference is government regulations.
If you are allowed to multiple homes or an apartment block then you land is worth much more.
Tk : DR - Over 80% of real estate value creation is changes in land use.
Does this viewpoint help explain anything in a useful way? I do not understand why you would think of wealth this way.
You have two cows.
You trade one for a bull.
That is how wealth is created. Govt is not needed except to protect your rights to buy a bull.
This isn't wealth creation; not all increases in value is because of creation.