Home > Economics > Bastiat and the fallacy of the Broken Window

Bastiat and the fallacy of the Broken Window

Tom G. Palmer explains in this short story from Frédéric Bastiat why destruction is not a reason for economic rejoicing:

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  1. 18 April, 2010 at 3:12 pm

    What if the glazier bought a suit with the money the baker paid him to fix the window?

    • William
      19 April, 2010 at 12:59 am

      Of course we presume the glazier buys a suit, or invests the money, or does something useful with the money received. But from the point of view of society as a whole, that’s the same money the baker would have used to buy the suit, or invest, or do something useful. As a whole, looking at the total net costs and gains, the economy is still worse off by the cost of the window.

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