Economic Facts and Fallacies

Economic Facts and Fallacies

Thomas Sowell

Language: English

Pages: 276

ISBN: 0465022030

Format: PDF / Kindle (mobi) / ePub

From one of America's most distinguished economists, a short, brilliant and revelatory book: the fundamental ideas people most commonly get wrong about economics, and how to think about the subject better.
Economic Facts and Fallacies exposes some of the most popular fallacies about economic issues--and does so in a lively manner and without requiring any prior knowledge of economics by the readers. These fallacies include many beliefs widely disseminated in the media and by politicians, such as fallacies about urban problems, income differences, male-female economic differences, as well as economics fallacies about academia, about race, and about Third World countries.
One of the themes of Economic Facts and Fallacies is that fallacies are not simply crazy ideas but in fact have a certain plausibility that gives them their staying power--and makes careful examination of their flaws both necessary and important, as well as sometimes humorous.
Written in the easy to follow style of the author's Basic Economics, this latest book is able to go into greater depth, with real world examples, on specific issues.













regards the kind of housing being built but also as regards the kind of people who move in. 34 Economie Facts and Fallacies Respect for property rights means that existing residents and potential newcomers compete for the same space on an equal basis in the marketplace, rather than in a political process in which only the existing residents can vote. While the existing residents may choose to believe that they have a right to "protect" their community against outsiders by using the power of

political pole, Rexford G. Tugwell, the federal administrator responsible for the New Deal's Green Belt demonstration suburbs, explained, "My idea is to go just outside centers of population, pick up cheap land, build a whole community and entice people into it. Then go back into the cities and tear down whole slums and make parks of them." 49 42 Economie Facts and Fallacies T h e demolition of any neighborhood will of course destroy not only the physical structures of that neighborhood but

measured, but what if women who are more driven to pursue a career are less likely to marry early or perhaps at all? That is not measurable, which is not to say that it is not important. Income differences between less driven and more driven women may be falsely attributed to marriage, when in these cases differences in marriage patterns may be an effect rather than a cause. In other words, it need not be marriage, as such, which accounts for income differences between married and unmarried

subprime loans more often than Asian Americans, a study of the 1990-91 downturn in employment showed that white workers were more likely to lose their jobs than were Asian American workers. Either we believe that white employers are prejudiced against white workers or we admit that groups can differ from one another in characteristics relevant to economic decisions. 79 Questions about the existence, magnitude, and consequences of racial discrimination cannot be answered with gross statistics,

adverse information— or hiring private detectives to look into the private lives of job applicants, housing applicants, or applicants for loans. Among these sorting devices are hiring by recommendations from existing employees, who have incentives not to jeopardize their own standing with their bosses by recommending someone they know will be wrong for the job. Race, as we have already seen, can be used as a sorting device, even by people who have no hostility to a particular race, including

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