The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.

Economics The study of the allocation of scarce resources that have alternative uses.

Fallacies

Fallacy- A fallacy is usually incorrect argument in reasoning resulting in a misconception or presumption

The Broken Window Fallacy War, natural disasters, big government spending- don’t help economies

The Free Lunch Fallacy Tax, inflation, low interest, creative loans, deficit spending, and the debt

The Isolation Fallacy One group doesn’t make or break the economy, profits and business help other businesses

Immediate Effect Fallacy The Immediate Effect Fallacy Look past phase one of economic polices, economic policies live longer than political terms

The Win- Win Fallacy Everything has a level of scarcity, you cannot have your cake and eat it to

The Composition Fallacy The Division Fallacy What is true for a part doesn’t mean it is true for the whole The Division Fallacy What is average for the whole doesn’t mean it is true for each part

The Protection Fallacy Creative destruction hurts but it is necessary, survival of the fittest and laws of nature. Protecting competitors not competition Protecting those who are on the inside against those on the outside

The Goal Fallacy Goals and ideas rarely match true consequences, the market is natural, goals are man made

The Zero-Sum Fallacy Aka The Fixed Pie Fallacy Wealth doesn’t take from others it builds other

The Chess-Piece Fallacy People are human and cannot be counted on like pieces on the chess board

The Open Ended Fallacy There can always be more of something good but nor at the expense of something else Open space, health, safety

The Leveling Fallacy Like water- price is self leveling, supply and demand, quality If the government legislates price then supply or demand suffer. If the government legislates price, supply, and demand, than quality suffers. Additionally, the Government cannot legislate competition. There will always be competition.

The Fence Policy Fallacy Good fences may make good neighbors but not good economics Free trade Also the fallacy that immigrates cause unemployment Protectionism

Prices are a measurement of wealth, not wealth itself. The Money is Wealth Fallacy Prices are a measurement of wealth, not wealth itself.

Production for its own sake The Production for its own sake Fallacy Paying someone $200,000 to dig ditches and to fill them back in will not improve the economy

Correlation = Causation The Correlation = Causation Fallacy The Post-Hoc Fallacy (false cause, coincidental correlation, correlation not causation): X happened then Y happened; therefore X caused Y

The Single Cause Fallacy