The problem with your analogy is that even if there were a fixed amount of currency, there is never a fixed amount of wealth.
Some people are more productive than other people. Most people are productive to some degree, and their productivity creates ever more wealth.
One of the individuals on your desert island might be more productive at acquiring things that others would like to have: fish, coconuts, wild boar, palm leaves, whatever.
When that happens, a fixed rate of "money" (or "currency" which is what you are talking about) can be sliced up into more bits. My 10 fish that I used to sell for $1 can now sell for 50 cents because I was so productive with my new technique in fishing that I caught more than I expected. Therefore, the value of each fish is less due to an over supply, and that over supply is due to increased productivity.
This increased productivity drives prices down, and increases the value of each dollar, relative to the wealth. So there is no reason to "print more money" -- unless you want to steal the wealth of others -- since total wealth is always increasing, due to productivity always expanding.
The BIG problem that most modern day "economists" have is they do not understand that human productivity is the main driver of a prosperous society.
It is NOT consumption. It is productivity. This is WHY an economy gets destroyed by any form of socialism. Socialism/communism (same thing, ultimately) destroys economies because it disincentivizes productivity, and productivity generates wealth. A lack of productivity reduces wealth.
Money is just a scorecard. It is not the essence of wealth itself.
Central banking and centrally-planned government destroy wealth to benefit the insiders, but they produce nothing of value for society as a whole. They are merely parasites.
The problem with your analogy is that even if there were a fixed amount of currency, there is never a fixed amount of wealth.
Some people are more productive than other people. Most people are productive to some degree, and their productivity creates ever more wealth.
One of the individuals on your desert island might be more productive at acquiring things that others would like to have: fish, coconuts, wild boar, palm leaves, whatever.
When that happens, a fixed rate of "money" (or "currency" which is what you are talking about) can be sliced up into more bits. My 10 fish that I used to sell for $1 can now sell for 50 cents because I was so productive with my new technique in fishing that I caught more than I expected. Therefore, the value of each fish is less due to an over supply, and that over supply is due to increased productivity.
This increased productivity drives prices down, and increases the value of each dollar, relative to the wealth. So there is no reason to "print more money" -- unless you want to steal the wealth of others -- since total wealth is always increasing, due to productivity always expanding.
The BIG problem that most modern day "economists" have is they do not understand that human productivity is the main driver of a prosperous society.
It is NOT consumption. It is productivity. This is WHY an economy gets destroyed by any form of socialism. Socialism/communism (same thing, ultimately) destroys economies because it disincentivizes productivity, and productivity generates wealth. A lack of productivity reduces wealth.
Money is just a scorecard. It is not the essence of wealth itself.
Central banking and centrally-planned government destroy wealth to benefit the insiders, but they produce nothing of value for society as a whole. They are merely parasites.