Two economists are walking down the street and pass by a pile of dog shit. One of them (a sadist) turns to the other and says "I'll pay you $1000 if you eat that dog shit".
The other performs an internal utility calculation and eats the dog shit.
Continuing their walk, the second economist sees another pile of dog shit and makes the same offer to the first. The first economist also agrees, and eats the dog shit. They walk on.
After a while the second economist says to the first "it feels like we're both worse off than we were before this walk".
The first economist replies "impossible! We've just engaged in 2000 dollars worth of trade!".
The other performs an internal utility calculation and eats the dog shit.
Continuing their walk, the second economist sees another pile of dog shit and makes the same offer to the first. The first economist also agrees, and eats the dog shit. They walk on.
After a while the second economist says to the first "it feels like we're both worse off than we were before this walk".
The first economist replies "impossible! We've just engaged in 2000 dollars worth of trade!".