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It's not 100% fallacy if there's slack in the labour market. If you have 10 chaps hanging around, all of whom have broken windows, there's a gain in both wealt
by barrkel 9y ago
It's not 100% fallacy if there's slack in the labour market.
If you have 10 chaps hanging around, all of whom have broken windows, there's a gain in both wealth and employment if some of those chaps get organized and start fixing windows.
To the degree that the novelty is good, keeping otherwise unemployed people active producing novelties is neither a loss nor a waste of time. Of course it doesn't make sense to go around breaking windows to keep the dynamic up, unless breaking windows is enormous fun and gives people lots of utility (which it might!).
More generally, thinking about these things in terms of money rather than wealth, production and consumption (a stock and its positive and negative flows) leads people to faulty intuitions. They're familiar with household budgeting and other situations where money seems tangible. But money is just a way of accounting for the stock, and measuring and transporting the flows. It's the actual wealth, production and consumption that counts.
- tombusby 9y ago> there's a gain in both wealth and employment if some of those chaps get organized and start fixing windows. This is the core of the fallacy. There'd be more net wealth without breaking the window in the first place, leaving the guy free to spend that money on someone else's goods/services, who would cause the exact same amount of growth but you'd still have a window. Spending that money that would have been spent replacing broken windows elsewhere may even generate jobs for the guys who are slack. You can never stimulate a growth of wealth by destroying wealth. If you're saying the window is already broken, that's not the broken window fallacy.
- barrkel 9y agoI already said that the windows were already broken. And I explicitly said people who would be otherwise unemployed. It's like you didn't read what I wrote. And if breaking windows is a thing we value in society, then it wouldn't be a bad thing to go around breaking windows and continuously employ people to fix them up again. The reason I'm stretching it like this is to make "broken windows fallacy" fit fidget spinners and other fads, because that's what's needed to make the analogy work. (You know, the actual topic.) You can never stimulate a growth of wealth by destroying wealth I never said you could. People can, however, increase their wellbeing by consuming wealth, and a cycle of consuming wealth and producing wealth is not a waste of time; if breaking windows was beneficial to wellbeing, then it wouldn't be a waste of time to continuously cycle between breaking and repairing windows. Don't forget that wealth isn't a terminal value anyone is interested in; wellbeing (aka utility) is.
- bbernoulli 9y agohttps://en.wikipedia.org/wiki/The_Scheme_for_Full_Employment https://en.wikipedia.org/wiki/The_Scheme_for_Full_Employment
- tombusby 9y ago"What a genius idea" - Lord Keynes