districts supplied, this tendency to specialization and
consequent exchange of goods would grow in an ever-widening circle.
Instead of the tribe being a commercial unity, the zone in which the
interchange of goods went on would widen as far as the geographical and
other boundaries allowed it. In the same country one district would be
found to be specially well adapted for agriculture, and another for
pasture; another, being well supplied with metals, would naturally
provide a race of smiths and producers of rough tools for industry, and
the exchange of commodities between districts with these various
capacities would mean that the specialization of production would go
steadily further, and that a whole town or village would be found in
which the great majority of the inhabitants were at work upon one
particular form of industry, relying for the other kinds of commodities
that they required upon the activity of a similar community living in
the next valley or on the other side of the river. This widening-out
process would naturally extend itself over the borders of different
countries. Obstacles to this process would be found in the differences
of language and probably in the difficulties of transport. On the other
hand, it would be greatly stimulated by the different ideas of value
that prevailed in different communities. Value depends upon the extent
to which anybody wants a thing, also on what he thinks it is worth, that
is to say, the number of commodities in his possession with which he is
prepared to part in order to secure it. Obviously commodities coming in
from foreign countries, and being unknown or rare in the country in
which they are offered, if they are otherwise at all attractive, possess
a certain amount of what is called scarcity value, which makes them
easily saleable by adventurous merchants who arrive with the cargo.

The stories of fortunes made by merchants who travelled among simple
native tribes with cargoes of glass beads and were able to exchange
these gaudy baubles for gold or rubber or other commodities which are
valuable in civilized countries, have often been told, and opportunities
for trading of this kind must have been very much more frequent when
communication was comparatively difficult. Value to a great extent being
determined by local convention and local habit, the profits of the
trader were likely to be considerably increased the further he got from
his home market. If he took away w