Index
- pg 13: The broken window fallacy is often disguised in many different forms. It is one of the most persistent fallacies in economic history.
- pg 14: The notion that war is beneficial for the economy comes from the broken window fallacy.
- pg 14: The notion is also supported by the fallacy of confusing need with economic demand.
- pg 14: Economic demand requires both need and corresponding purchasing power.
- pg 14: Another fallacy often found here is the conflation of purchasing power with monetary supply. This is why people may see war time inflation as a positive economic result.
- pg 14: Just like with the broken window fallacy, it is true that there will be economic benefits for certain businesses and producers, primarily those tasked with repairing all the damage and those creating products that were not able to be produced during war.
- pg 15: The catch is that really this is simply diverting demand to certain products over others. More houses might get built out of necessity, but now there is less capacity for the production of other goods and services.
- pg 15: In addition to this shifting of demands, war will also shrink the demand.
- pg 15: Supply creates demand. People exchange the supply they produce for goods supplied by others. Goods must be supplied to acquire purchasing power, which is a requirement for economic demand.
- pg 16: While inflation may look like the creation of more demand due to the abstraction of money, there is no actual increase in production and exchange.
- pg 16: Postwar demand will be lower than prewar demand as the supply will have shrunk.