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That's usually called "the broken window fallacy". A kid goes out and breaks random windows in people's home; as a result, a lot of economic activity ensues -
by beagle3 7y ago
That's usually called "the broken window fallacy".
A kid goes out and breaks random windows in people's home; as a result, a lot of economic activity ensues - the glass producers, the people who produce glass cutters and specialized tools, the people who install windows, the cleaners who specialize in cleaning broken glass, etc ...
The ad industry is breaking everyone's windows. It does indeed produce a lot of economic activity; But it is more likely than not "misallocation and waste of funds" when looked at in a broader context.
- qroshan 7y agoBroken Windows is actually not a fallacy (classic Keynsian vs Hayek argument) If past decade has proven anything. Keynsian economic policies worked (printing money forcing people to spend) while a Austrian Austerity would have been disastrous. Again, HN will not understand the side effects of destroying a major ecosystem. They all think they are much smarter and can stand on their own and VC money has no effect on their livelihood and it's their superior linux skills that keep them making tons of money
- beagle3 7y agoThe past decade has proven that central banks can keep a system afloat for a decade. It remains to be seen if it proves anything else.