2012-09-30

Debunking the Broken Window Fallacy

It says that, according to Keynes, it is logical for the government, facing a recession, break windows, to create demand for glass and window installers, to spur the economy.

Yes, it says that, but Keynesianism does not say that is the only source of truth. Keynesians might also say that the government has a job to try to control unemployment. This does not mean Keynesians are suggesting murdering the unemployed.

There is no broken window fallacy, just as there is no murdering the jobless fallacy, because people have some common sense and don't usually throw it all away in the name of ideology.

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