Wood - Fifty Economic Fallacies Exposed

It is often said that economics is applied common sense. Unfortunately, as I remember the man who owned the local bicycle shop saying to me when I was a child, the problem with common sense is that it is not common enough. And so it is that the demand for this monograph by Geoffrey Wood, Fifty Economic Fallacies Exposed , never seems to decrease.

I was delighted that Professor Wood agreed to update this publication to allow the IEA to publish a new edition. A few old fallacies have been removed to make room for new ones (though, no doubt, the old ones will become relevant again in the future). But, as the author said to me, all the fallacies are essentially the same. They arise from an inability of people to understand supply and demand (and, by implication, opportunity cost).

Henry Simons once said: Economics is primarily useful, both to the student and to the political leader, as a prophylactic against popular fallacies. Through the vehicle of undermining fallacies, Professor Wood brings to his audience good economics. As such, this new edition of Fifty Economic Fallacies Exposed is an important contribution to the IEAs educational mission.

The views expressed in this monograph are, as in all IEA publications, those of the author and not those of the Institute (which has no corporate view), its managing trustees, Academic Advisory Council members or senior staff. With some exceptions, such as with the publication of lectures, all IEA monographs are blind peer-reviewed by at least two academics or researchers who are experts in the field.

Philip Booth

Editorial and Programme Director

Institute of Economic Affairs

Professor of Insurance and Risk Management

Cass Business School, City University, London

July 2014