Hi guys,
Here’s a list of “Top 10 economic myths” from here:
http://hiddeneconomist.blogspot.com/2010/09/top-10-myths-about-economics.html
Can you think of others, more common?
I had a long post ready, but when I clicked post, it just disappeared. Dont know what happened lol.
Basically,
9 is wrong in the sense that it is not just government that causes unfounded expansion of the money supply. Rothbard wrote a book on it.
I agree with 8, but our current version of free trade is not the greatest example to offer (tho I still support it nonetheless). Companies who cannot keep up with what a (arguably) free society demands (or as you might want to say, free societies who demand too much from the economy) run to the protection of tyrannical and exploitive states who sell their country on the cheap (probably much cheaper than what those people would have freely chose)
II get what he is saying with “Minimum wage laws in fact makes illegal for poor and low skilled people (especially young workers) from being employed at all,” but that is kind of disengenous. It really just makes it illegal for companies to pay less than the minimum wage (depending on size of company and nature of job). I agree with what he is saying (somewhat), but the rationality is way off.
I disagree with how the author tries to seperate technology from the ability to use it. Technology is both the knowledge of it (science) and the ability/access to use it.
Most people do argue 4, but when they say “don’t have money” they really mean “dont have access to resource.” Also… “Poor countries are plagued by governments that routinely violates their citizen’s property rights, through taxes, licenses, permits, tariffs, regulations, and outright expropriation”… you could pretty much get rid of everything but that last one, as rich countries engage in the first 5 as well as tyrannies.
3, 2, and 1… Who argues those?
3 would be more accurately represented as “greedy rich people cause low wages” than what he argues.
Im not sure many people actually argue 2, especially if they know anything about capital.
I guess people argue 1 if there is a refutation of it, but I havn’t really seen anything. I have seen some attribute US economic growth to its involvement in WW2, but that is really just about the mobilization of industry and that we were not destroyed like the other nations.
That’s basically the broken window fallacy: We prospered because everyone had to buy from us to rebuild.
Good point. Say everybody had to buy from us to rebuild. What do they give us in as payment? Whatever it is, call it Object X why couldn’t they have given us Object X if they had not lost anything in WW2?
“Ah, but they would not have needed our stuff if they were not destroyed.”
“You mean we could have kept it for ourselves? Meaning we would be wealthier? So how did WW2 help us?”
“You don’t understand. Factories would not have been working at full capacity if not for Europe needing what we have.”
“You mean the guys who owned them foolishly built them too big? All over the country? Everyone? How did that happen?”
How about Upton Sinclair’s The Jungle, and how the market supposedly doesn’t regulate itself for safety.
Or how about barrier to entry, whereby the government has to create infrastructure and things of that nature otherwise companies will get a monopoly over utilities and roads.
“Ah, but they would not have needed our stuff if they were not destroyed.”
“You mean we could have kept it for ourselves? Meaning we would be wealthier? So how did WW2 help us?”
“You don’t understand. Factories would not have been working at full capacity if not for Europe needing what we have.”
"You mean the guys who owned them foolishly built them too big? All over the country? Everyone? How did that happen
(Man C) "They built them to a size bigger than what they would have been able to be under a free market. This, as you may well know, provided for a lot of jobs and profits. What you may not be thinking about is how much this empowered the military-industrial complex and set us in a position to be in perpetual warfare and military expansion to keep the system alive. Welcome to Rome 2.0.
The demand for commodities is the demand for labor.
That’s a good one, although a myth that mainstream economist believe in, not the public in general 