[Lalwendë]

Mithril, whilst rare and valuable, would not stir the Lords of Rohan or Gondor into a fight over it - that view is totally unjustified in context with their real challenges in Middle Earth. If it were so, they would be sending men to mine for it like the Dwarves.

We are talking about Middle-earth, and we know, because Tolkien told us so, that Mithril was a material so rare and so sought after as to be almost beyond monetary worth - which is why he made a comparison to the whole worth of a 'nation' - not quite a literal comparison but a metaphorical one to emphasise what a truly rare thing it was that Bilbo had. It would be like saying today that you might 'pay a King's ransom' in order to obtain that Wii that nobody can find on the shop shelves.

However we also know just how much people wanted Mithril because of what the Dwarves foolishly did in order to get at some of it. We also know there likely wasn't much if any left that was obtainable.

Economies can only grow with increased market growth nationally and internationally. Where do you think the manufacturing material in China and India ends up? Mostly to companies abroad at a lower price, of course, hence their growing market share and booming economies. And Hobbits do not have the mind set or culture of Men. They would have to prove that they can adapt to the tastes, wants and needs of Men and acquire much more knowledge about them before manufacturing items for them. Most Hobbits avoid men like the plague, unconcerned by their affairs.

The Tokugawa shogunate of Japan was perhaps the most famous isolationist economy. They only traded with the Dutch and were effectively closed to the world at large, and Japan prospered immensely during this time, not just economically but socially and artistically. The Shire probably worked in a similar way - limited trading, little involvement in squabbles, and hence a long period in which their country could grow. This may also tell us why The Shire is a lot different with seemingly more advanced products for sale than other countries - there's not a lot of mention of umbrellas and postal services in Gondor

Hobbits had no need to trade much, they seem to have lived comfortably enough without troubling anyone else. And probably went on that way too in the Fourth Age.

As during those two hundred years of protectionism which Japan enjoyed, The Shire probably quietly improved, including clearly growing enough so that humble Hobbits like Sam had leisure time enough to spend with the old bloke up the Hill, who taught him to read. There's no reason other Hobbits weren't doing the same as this was no subsistence level existence and nor was it feudal.

War may help to stir a recession, and affect leadership in Gondor or Rohan, but why do you assume the same cannot affect the Shire? Saruman virtually destroyed the Shire single-handedly!

It didn't affect The Shire because it was untroubled by conflict for years. Rohan on the other hand was a 'border' country with troublesome Dunlendings on one border, and eventually a King who became corrupted, while Gondor had been under attack for many years. Saruman only showed his face in The Shire towards the end of the War. He only just had time to chop down a few trees and sell off a few goods.