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Thursday, February 26, 2015

Econlib: The Ten Pillars of Economic Wisdom

The Ten Pillars of Economic Wisdom, David Henderson | EconLog | Library of Economics and Liberty
A few times I've referred to "The Ten Pillars of Economic Wisdom" that I teach at the start of every economics course I give.
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A few times I've referred to "The Ten Pillars of Economic Wisdom" that I teach at the start of every economics course I give. I've usually linked to someone's restatement of them from my book, The Joy of Freedom: An Economist's Odyssey. But I've updated a few times since then. Here's the current version of them.

The Ten Pillars of Economic Wisdom
By David R. Henderson

1. TANSTAAFL: There ain't no such thing as a free lunch.
2. Incentives matter; incentives affect behavior.
3. Economic thinking is thinking on the margin.
4. The only way to create wealth is to move resources from a lower-valued to a higher-valued use. Corollary: Both sides gain from exchange.
5. Information is valuable and costly, and most information that's valuable is inherently decentralized.
6. Every action has unintended consequences; you can never do only one thing.
7. The value of a good or a service is subjective.
8. Creating jobs is not the same as creating wealth.
9. The only way to increase a nation's real income is to increase its real output.
10. Competition is a hardy weed, not a delicate flower.

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