2 ms·

You're very first point is completely wrong. It is very easy for people to lose wealth and no one receive it. 1. Factory Burns Down -- Lost wealth 2. Factory

You're very first point is completely wrong. It is very easy for people to lose wealth and no one receive it. 1. Factory Burns Down -- Lost wealth 2. Factory no longer competitive - Lost Wealth 3. Built too many houses/widgets/etc - Lost Wealth You lose wealth when jobs that a skilled worker had disappear, not because of technology but because it's not needed anymore. Say for instance you trained 1000 people to run a specialized machine that was used to mine gold in a certain region. As soon as that gold runs out all the investments made in that specific region that are not transferable are lost.

jamesbressi 17y ago
Sorry, you are actually completely wrong =/ All three of your examples are wrong in fact. In every case someone else is going to make money. 1. "Factory burns down -- lost wealth" -- Well a competing factory will pick up that business, sorry. Not to mention if the factory wants to rebuild, construction workers make money. 2. "Factory no longer competitive - lost wealth" Again, no. If a factory is no longer competitive, a competitor will take that business. 3. "Built too many houses/widgets/etc - lost wealth" Lastly, again, no. Let's look at the housing market which was your first mention. People are losing their houses right? Then there are people that buy those houses at huge discounts from Sheriff's sale, fix it up, resell it later for profit. And for the paragraph at the bottom of your comment, wrong again. As soon as the gold runs out in that region, a company in another region with gold will be picking up that loss of business and making money. Thanks for the debate though.
- dantheman 17y ago
  I still think you wrong. 1. Even if a competing company picks up that business wealth is still lost; Sure the other company may earn more money but the total wealth in the world has gone down. That other company could've productively produced some other good, and now has to produce what the other did. Also, the construction workers rebuilding it is just bastiat's broken window fallacy (http://en.wikipedia.org/wiki/Parable_of_the_broken_window http://en.wikipedia.org/wiki/Parable_of_the_broken_window). If the factory didn't burn down the construction workers could have built new things, not merely replacing old. 2.I may have not stated this one clearly enough; when a factory looses it's competitive edge due to mismanagement it's losing wealth. If they were able to properly manage the company everyone would be richer on average. 3. When you build too much of a good that isn't needed then you've lost wealth overall. The housing example might be too complicated, it has a lot of interrelated factors, but lets assume I make action figures. If I produce 100 Billion of them and there are only 1 million people that want them -- we've lost wealth... The time and energy producing the extra ones has now been squandered. Sure the market may expand to 10 million people with deep discounts but wealth was still lost.

jamesbressi 17y ago

Sorry, you are actually completely wrong =/ All three of your examples are wrong in fact. In every case someone else is going to make money. 1. "Factory burns down -- lost wealth" -- Well a competing factory will pick up that business, sorry. Not to mention if the factory wants to rebuild, construction workers make money. 2. "Factory no longer competitive - lost wealth" Again, no. If a factory is no longer competitive, a competitor will take that business. 3. "Built too many houses/widgets/etc - lost wealth" Lastly, again, no. Let's look at the housing market which was your first mention. People are losing their houses right? Then there are people that buy those houses at huge discounts from Sheriff's sale, fix it up, resell it later for profit. And for the paragraph at the bottom of your comment, wrong again. As soon as the gold runs out in that region, a company in another region with gold will be picking up that loss of business and making money. Thanks for the debate though.

dantheman 17y ago
I still think you wrong. 1. Even if a competing company picks up that business wealth is still lost; Sure the other company may earn more money but the total wealth in the world has gone down. That other company could've productively produced some other good, and now has to produce what the other did. Also, the construction workers rebuilding it is just bastiat's broken window fallacy (http://en.wikipedia.org/wiki/Parable_of_the_broken_window http://en.wikipedia.org/wiki/Parable_of_the_broken_window). If the factory didn't burn down the construction workers could have built new things, not merely replacing old. 2.I may have not stated this one clearly enough; when a factory looses it's competitive edge due to mismanagement it's losing wealth. If they were able to properly manage the company everyone would be richer on average. 3. When you build too much of a good that isn't needed then you've lost wealth overall. The housing example might be too complicated, it has a lot of interrelated factors, but lets assume I make action figures. If I produce 100 Billion of them and there are only 1 million people that want them -- we've lost wealth... The time and energy producing the extra ones has now been squandered. Sure the market may expand to 10 million people with deep discounts but wealth was still lost.