One can assume that individuals are normally rational, that is, they prefer to have and consume more than less of everything that gives them satisfaction. They cannot have everything they would like nor can they satisfy all their needs because the resources they have to allocate to the acquisition of those satisfiers, of those goods, are limited.
Consequently, given this scarcity of resources, individuals have to choose how they are going to allocate them and which of all their needs they are going to satisfy and to what degree. In this process of deciding how to allocate scarce resources, Individuals have a planning horizon within which they have to decide how much of their income is destined for consumption in the present and how much they save to consume in the future and it is clear that the greater the sacrifice in the present, the greater the consumption may be in the future.
The Most Essential Deals
Linked to the above, individuals have to make two other decisions: first, how much of their available time they allocate to leisure and how much to work and second, where they will work, that is, in which sector of economic activity they will use the productive resources of your property. Both decisions have a single objective, which is to try to obtain the maximum possible performance since this is what allows them to generate the income to acquire the goods with which they will satisfy their needs and it is obvious that the higher the income, the more needs will be able to satisfy. You can Click here to visit Vimeo channel also to get the best Evergreen Wealth Formula for you.
The Decision Making
In all this decision-making process, a particular consideration is that parents want their children, when they are the same age as them, to have a higher standard of living than they themselves have, so in the allocation of resources, they will be willing to sacrifice their own consumption and allocate those resources so that their children accumulate human capital that allows them, in the future, to generate an income stream.
In this way, the postponement of present consumption by parents, together with the sacrifice of their own consumption to give those resources to their children, means that in each generation the value of capital increases and it is this process of wealth accumulation which results in an intergenerational improvement of well-being, that is, generates economic development.
Given that the accumulation of wealth is the indispensable condition for economic development, it is surprising that the Vatican has declared “excessive accumulation of wealth” a mortal sin. From what was said above, the Vatican is implicitly punishing economic development, it is encouraging the perpetuation of poverty, an action now also classified as a mortal sin and furthermore, what should be considered excessive accumulation of wealth”? Everyone who appears on the Forbes list?
All those whose wealth is greater than the average wealth of the population of a country plus a certain standard deviation? Is it excessive to have a global wealth between properties, value of human capital and financial savings of 100,000 dollars or only if it amounts to more than a million dollars? It is true.