Economics in One Lesson

Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economics by Henry Hazlitt, Crown Publishers, 1979. 

Cause and Effect

The author approaches economics from the perspective of cause and effect. In order to properly understand economic one must study not just some of the effects of an action, but all of them. One must study not just the short-term effects, but also the long-term effects. 

Zero-Sum Game

For every job created in public works, the taxes that provide the salary for that job come from the private economy, and cause one private job to be lost. For every structure, such as bridge or hospital, built by the government, the private economy builds one fewer structure, due to the taxes that were paid to fund the public structure. This is hard for some people to see, because the public structures that was built can be seen with ones own eyes, but the private structure that was not built cannot be seen, but only imagined. 

Automation

At first glance, it would seem that automation will reduce employment, because  using a machine reduces the number of workers required to produce a particular amount of output. This is true, but it is not the whole truth. Automation has other effects. In particular, automation leads to increased profits which leads to expanding operations which leads to hiring more workers. When adding up both the negative and positive effects on employment, automation produces a net gain in employment. 

Minimum Wage Laws

Minimum wage laws increase unemployment, because people whose skill level is so low that their labor is worth less than the minimum wage will not be kept or hired.

Technology

The increases in wages during the twentieth century in America were not due to labor unions, but rather to technological advances.