x dollars went to replacement instead of creation.
x dollars was spent once to creat the window, and then had to be spend again to replace it.
x dollars could be better spend on a new suit. 'New'

the business owner is now poorer instead of investing that money in his business or somehow making his life better.

Are you retarded?

>>190937
It doesn't matter if it was created before. The x dollars still went into the town. Same as if it went to the suit maker.

>>190951
0/10

yes the x dollar still went to the town, but the town was 1 window poorer, and the value of that window poorer. Basically, the shop keeper LOST the vaule of 1 window, and he being a part of the town, the town lost that value.

>>190941
Why yes. I'm the retarded child of a French glazier.

>>190951
However X dollars to replace the window doesn't grow the shopkeepers business. It doesn't even likely grow the business of the guy who replaces windows. It just moves money around. But if he spent x dollars he could grow his business and increase the number of dollars in the town

>>190969
Why is his business able to gown with the x dollars and not the window maker's business?

OP is right. This is why Libertarians are retarded.

not sure if you're trolling OP, but you should read Economics in One Lesson by Henry Hazlitt if you're really interested. It starts with the broken window fallacy and is modeled after Bastiat's essay. It's better than Wikipedia.

>>190976
Because the window makers business is set up to make Y number of windows a year. Unless people bust up a bunch of windows like Detroit winning a superbowl would cause the windowmaker's firm isn't growing. Its just doing

>>190969
It grows the glazier's business

bottom line of accounting.
Assests - liabilities = New Worth.
1st window was an assest. when broken it became a liability. Lose of one asset and gain in a libility means a lower net worth.

>>190986
>The suit maker's business is set up to make Y number of suits a year.

Why does the suit maker or store owner get better results than the windows maker? It seems like arbitrary favoritism.

>>190907

Is it wrong I want to raep this animoo character?

>>190986
That's not how business is done in a free market. Nothing produces for the sake of use, it is always for the sake of demand.

>>191003
It applies to the suitmaker or the store owner as well if the money isn't being applied to expand or improve their business

also
>>191001

The point of the story OP is that money isn't wealth--goods are. Destroying something destroys wealth. Money just facilitates trade.

I wish cute anime girls asked me economics questions in real life :(

>>190965
The same would be true of the shopkeeper. His store is only set up to serve a certain number of customers per year.

>>191007
and you plan your business for a set amount of demand. Planning for to much demand means you go out of business. Planning for to little means you need to invest in your firm....or go out of business

you plan for the just right amount you have enough to keep going

Libertarians don't care about the loss to the community. They're just upset because the store owner lost something and can't be selfish anymore.

>>191023
Well what about the loss to the community of growing business?

If companies keep growing that means more people need to come and grow your community

maybe you shouldn't be an idiot and should care about that

The parable has nothing to do with investment or growing business or any of that. He used a small scale to make it easier to understand. If I destroy your xbox, you'll be worse off, and you won't care that Microsoft might get to sell a replacement. If everyone started destroying property to increase demand, everyone would be poorer. Yet that's how government policy works sometimes.

the fallacy comes from the fact that money does not have value, but real things do.

Basically, lets say the community had 10 things. The money could have gone to thing 11, but the stupid kid broke the window. That means the community went to 9 things, and the money had to be used to get back to 10 things. Make sense?

>>191033
The glass maker's business grows.

>>191023
There is no loss to the rest of the community. He would have given the money to the suit maker anyway. Best be trolling.

Wait... This is "broken windows" theory as it relates to crime.

Was about to rant and show off my Criminal Justice skillz.

>>191053
Not necessarily.

Liberals don't understand economics, NO SURPRISE HERE

Normal liberal mistake, MONEY IS NOT WEALTH, PHYSICAL OBJECTS ARE WEALTH.

>>191066
The store owner's business or the suit maker's business doesn't necessarily grow either, why do they get special treatment?

>>191067

Well at least the misunderstanding was posed in a way that we could educate. But a lot of the conservative answers in this thread have been dead off too, or at least not 100% correct. A lot of the answers seem to think that by not spending the money on a window, we automatically do better. However, it's not so much that we do not spend the money on the window but that we spend the money on gaining things.

In my previous reply, I said that basically because we didn't grow in number of things, thats where the benefit was lost. By the same logic, had the shop owner added a window to his shop, the economy would have improved. It's because, as I said, things have value, money does not.

>>191049
Only decent explanation in the thread.

>>191096

Thanks. And I've never read anything on economy or really given two shits about this stuff before either. It just makes sense, logically. Honestly, half this forum is filled with so much shouting people forget to explain their stuff in a way simple enough to be legible.

>>191049
This. Nice and simple.

Another way to look at it would be to pretend the community is one person. He breaks a window. Now he makes a new window. In the time he spent making that window he could have made a suit. Breaking the window thus made him worse off.

>>190907
Because he spent X amount of dollars on the window that means the next X amount of dollars he has he has to spend it on whatever the original X was going towards and it keeps going on and on

It's pretty simple, dude. Basically if a man had his window broken by some kid that would make business for a glass craftsman right? so it is assumed that the broken window actually turned out to be a good thing because the broken window actually stimulated business for the glass craftsman. HOWEVER, what people fail to understand is that that is just a shallow observance of the real situation. yeah the glass man profits from this but what about the storekeeper? he could've used that money to invest in his store or spend on something else in the community like a new suit, etc. in other words, the glass man's gain is the community's loss. the main reason most people don't understand this is because they can immediately see the benefit that it provided for the glass man, but they will never know what could have been. that money went to something that needed to be repaired instead of being used for other things beneficial to the storekeeper and the community (the suit tailor for example). Thanks to the broken window, only the glass man is noticed and others like the suit tailor NEVER EVEN ENTER THE SCENE. This also implies that since broken windows stimulates business people should go around breaking more windows. sure it stimulates business at a glance for the glass man but what about the other industries? suddenly you have a lot of people supporting a few industries to the detriment of everyone else. This is the most basic and commonly misunderstood concept in economics. For example, the idea that wars bring people out of poverty/depressions is false. try to think about what i said and understand how war comes into play.

Windows are the cause of global warming.

Doors are a Jewish conspiracy to lower the intrinsic value of money.

Kitchen sinks are destroying our youth and are paid in part by our tax dollars.

Barack bin Laden is trying to turn the entire goddamned neighborhood into Karl Marx's funhouse.

Essentially this is a question about the creations of goods and services from energy, via labour.

Now imagine the entire universe is just -

1) Boy with stone
2) A worker
3) Finite supply of raw materials

Only processes in the universe -

a) Worker expends energy, turning 3) into a window.
b) Boy breaks window
c) Repeat a)

Nothing much gets done in this universe.

Now assume boy doesn't break window. Worker can build a wall around the window. Then a room. A ceiling. A street. etc etc.

Everyone seems to be assuming that the money stops at the glassblower. What if the glassblower used the money earned from replacing the window to buy a new suit?

>>191270
because that's not even the point. we're talking about the storekeeper's money. the money HE was going to use is now sacrificed because of something else he had to do instead. do you not get this?

>>191287
That's not the issue. The issue is there is no net loss for the community, only the storekeeper. Sure sucks to be him, he could have bought that new suit from the tailor, but not the glazier is going to use the money to buy more sand from the quarry master, which he'll use to make several windows. The quarry master in turn uses the money to buy feed for the mules he uses to haul rocks. ect ect.

>>191287
What if because the window broke he was able to buy a new one made of stained glass that attracted customers and made him rich?

I'm thinking of the Chicago Fire here, which because of that fire chicago was rebuilt far stronger than before with more modern materials that made it extremely successful.

>>191309
The storekeeper is part of the community...

shit, I'm appalled it takes a thread with this many replies to explain that breaking a window destroys wealth. I feel bad for politicians.

>>191318
Part of, yes. He is not the community as a whole though. His loss is someone else's gain. What you're doing is focusing on the lose while ignoring the gain. In essence you're doing the exact opposite of the original point of the parable, which was saying people shouldn't focus on the glazier's gain and ignore the shopkeeper's loss.

>>191327
>His loss is someone else's gain.

omg no it's not. You missed the whole point. He would have spent the money anyhow. The parable is about the destruction of wealth. The essay it's from is about the seen and unseen consequences.

>>191340
Except it's not destroying wealth for the community unless the glazier is selling the window for less than the cost of the raw materials to make more windows.

>>191268

This.

Doesn't matter about someone else's gain. Resources were wasted on replacement.

Think about it this way also. whoever gained by providing the new window, might just as easily have gained from the storekeeper deciding to build an extension and purchasing new windows anyway.

Hypotheticals here mean nothing. Making proper use of limited resources is what matters.

>>191309
so with that logic we should burn every city to the ground because it will make them more prosperous!

>>191352
It would wouldn't it? Of course the assets would go down the drain.

> /new/ can't even understand the most basic fallacy in economics

> realizes most of you are liberals

>>191352
No, you're missing the point. Wealth isn't created or lost here on the community level. The storekeeper loses x amount, the glazier gains x amount. If you're only considering the storekeeper, then yes, it's a net loss. Once you add the glazier into the equation, it's a wash. Which is the whole point of the parable in the first place. You can't just consider one side here. You need to consider both the gains and losses.

>>191346
>it's not destroying wealth for the community
yes it is. Why do you hate the shopkeeper so much? It could have been the glassmaker who broke something. It doesn't matter. The fallacy is that destruction creates wealth by increasing demand.

>>191366
The shop keeper isn't the whole community. Yes, he loses, but someone else gains. You're taking the point of the parable and running with it to the point you need to apply it in reverse.

>>191365
>>191371
You're seriously misunderstanding it. It's not a wash. It's a loss to the community. That's why he mentioned that the shopkeeper would have bought a suit (or pants?) anyway. A window and a suit is better than just a window.

I guess the parable isn't that great since people use it to think in demand-side economics terms, like giving someone money is creating wealth.

>>191365
THE POINT WAS THAT WE ARE TALKING ABOUT THE STOREKEEPER. The storekeeper represents anyone, we just refer to him as a storekeeper. what if everyone was forced to pay for things they had to pay for just to create business (like kids throwing stones at windows to make business for the glazier)? do you think the people would like that system? no, the community suffers even though certain industries are stimulated. instead of everyone prospering and exchanging and trading we must all now become dependent on a few industries (glaziers in this case). just like the fallacy that war always stimulates the economy. perhaps for the related industries like steel, etc. but what about the rest of the community? instead of producing other goods we must all now conform to the "war economy."

I though the parable was about how if you destroy something, it moves the wealth in the favour of someone who replaces destroyed property, obviously this is very inefficient, but if you are someone replacing the stuff, you still profit.

The money is unimportant as it is labour that provides true value in this case. The glazier expends time and effort that could be used for something more productive than replacing the broken window.

Please let this be some sort of troll.

The shopkeeper loses, the glazier gains, the tailor loses, there is a net loss. It's really not that complicated.

Read Economics in One Lesson for the best explanation.

>>191360
>>191360
>>191360
>>191360
>>191360
>>191360
>>191360

>>191390
Well most of the people in the world don't understand it, particularly politicians.

Easy mode:

Broken window = lost potential for dollars that could have been put into a net gain for the community

>>191390
The suit is no different than the window here. A broken window or worn out suit, it's all the same shit that's getting replaced. The only difference is who's going to get the money from the shopkeeper, the glazier or the tailor. There's still going to be raw materials consumed, and labor being done. Why is this so difficult to understand?

isnt it because of lost oppurtunity cost?

by replacing the window, you were replacing something that was already doing its job, and the money you lost could of been spent on something more productive

the window guy gets money, but at some point its going to come back to the shopkeeper, say the window guy buys a new suit, and the suit guy buys whatever shit the store guy sells, so even though he gets his money back regardless, he has still lost the oppurtunity to spend that money on expanding his business and adding a new window, which would benefit the community as a whole

>>191504
Except money is still going into the community. It's just going to the glazier rather than the tailor. Everyone seems to be assuming the glazier would just sell the window to someone else, yet not considering that the tailor might just sell the suit to someone else. The whole point of economics is one person gains a bit while someone else loses a bit. Whether the window is broken or not someone is still going to lose here.

The point is that unnecessary labour has been expended, labour that could have gone into producing something more useful than a mere replacement.

>>191001
>>191001
>>191001
>>191001
>>191001
>>191001
>>191001
>>191001
>>191001
>>191001
>>191001
>>191001
It's not hard, folks.

>>191510
>The suit is no different than the window here.
Correct.
>A broken window or worn out suit, it's all the same shit that's getting replaced.
It sounds like you're going down the wrong path here. There's no difference between creation for the purposes of replacement and creation simply to have something new.
>The only difference is who's going to get the money from the shopkeeper, the glazier or the tailor. There's still going to be raw materials consumed, and labor being done.
No, because you're forgetting that the shopkeeper is STILL down a window. You're saying the purchase of the window is no different from the purchase of the suit, and you're correct, but that's the whole point; the purchase doesn't matter AT ALL. You can ignore the purchase the shopkeeper makes entirely.

And when you ignore the purchase made later what do you get? One less window. The immediate aftermath of incident. From that point on - whether the window is broken or not - the same amount of wealth is being produced, despite the nature of the transactions being different.

Look at the results of the two scenarios: In one, the glazier has x amount of money and the shopkeeper has an intact window and a worn out suit. In the other, the tailor has x amount of money and the shopkeeper has an intact window and a new suit. Since the cost of the new suit equals the cost of a new window, the net wealth of the community in the second scenario is greater.

>>191522
What you're doing is looking at the transactions that would be made in either case and (correctly) concluding that there's no difference in them to the community as a whole, and then (wrongly) concluding that this makes the result of the situations equivalent.

There remains the value of one less window in the community where it had broken. This is true when no transactions are made; this remains true once transactions are made because, as you noted, the effect of the transactions on the community's wealth are not dependent on whether or not the window was broken.

only shit i know about windows is that if you break one, some shithead's gonna break another

I like how the parable doesn't mention the fact the glazier now has six francs to spend on something. :P

>>191585

Okay, so, the shopkeeper would have had to spend his money in the community on something, how is replacing a window different than replacing his shoes?

And now that the glazier has six francs to spend, he can go buy some bread, shoes, and a blowjob, and that money will filter back to the shopkeeper anyway.

What part of Keynesian economics don't you people get?

What happens if we replace the community with the world, and the broken window with, say, WWII?

SO LETS SEE THE SHOP DUDE SPENDS SUM GOLDZ ON A NEW WINDOW AND THE WINDOW DUDE GAINS MONEY FROM IT, SO FAR 1 DOWN 1 UP, NOW THE WINDOW DUDE BUYS A SUIT FROM SUIT DUDE, 2 UP, 1 DOWN... THEN THE SUIT DUDE IS FILTHY RICH AND GOES TO SHOP DUDE TO BUY SHOP DUDES SHIT, SO 3 UP 0 DOWN LOOKS LIKE A NEW BENEFIT TO ME

SRRY 4 CAPS WASNT LOOKING

ITT: A handful of few people who actually understand economics trying to explain it and a sea of Liberals who problably don't know anything beyond "Supply and demand" and "Capitalism is evil". Perhaps not even supply and demand. Also, OP succeeded in trolling.

>>190978
>>191023

I don't have a reaction pic in this comp, imagine the "HA HA HA, OH WOW" guy here.

currency should be considered like energy/matter. it can't be created or destroyed. the government can only reduce the value against foreign interests by "printing more and spending it". in effect, the broken window only releases currency that was being held up from circulation.
people saving money is the worst thing for the economy. only with a complicated banking system can they even attempt to use a fraction of the money saved at a risk when people panic.

so why do so many people worry about china? because they failed maco-econ. we're buying REAL things for imaginary paper. china should be buying shit from us with the money we gave them. but they don't. they stuff it away and print money to pay the locals that worked to produce wal-mart shit.

This entire thread is a demonstration of why GDP is an shitty way measure prosperity.

>smash other peoples light bulbs outside
>people go to walmart to replace lightbulbs
>stimulate economy

sure seems pretty good to me guize!