Hacker News Reader

Comment by cyberax | Hacker News Reader

"Broken windows" is not a fallacy. The common belief that it's a fallacy is a fallacy.

"Broken windows" indeed can stimulate the economy and improve the lives of people. But not _always_.

How can it stimulate the economy? That's just lack of consideration of cost of opportunity. Hospitals paying for more of similar software is hospitals not paying for something else that could actually improve care.

"Broken windows" can help to jumpstart a stalled economy, that exists in a state of depressed spending. In modern economies, this state is immediately apparent when the interest rate goes down to near zero.

E.g. the US in 2008. Or Europe and the US in 1930.

The fallacy is not that it doesn't create work or money circulation, it's that you are taking money and forcing it to be spent badly. The $100 someone spends on a windows you broke would've spent better spent on literally anything. And if it's not being spent, there's a reason for that as well.

But what if the reason for not spending is that other people are also not spending?

Remember, "your spending is my income".

How does exactly "breaking windows" improve the lives of people?

By creating work that needs to be done, and thus forcing people to start spending.

To bring things back to the original point, there's always a way for health centers to spend money improving patient care. They could hire more nurses and give the existing ones more sleep, for example. In the context of the analogy, a broken window is diverting resources from the broken plumbing and refrigerator motor instead of creating an incentive to spend where none existed.

Reply on news.ycombinator.com