Popular mistakes in reasoning about economic concepts

A fallacy is the use of invalid or otherwise faulty reasoning, or "wrong moves" in the construction of an argument. A fallacious argument may be deceptive by appearing to be better than it really is. Some fallacies are committed intentionally to manipulate or persuade by deception, while others are committed unintentionally due to carelessness or ignorance. The soundness of legal arguments depends on the context in which the arguments are made. An economic fallacy is one that misunderstands or misrepresents the principles of economics.


UpdThe Nature and Significance of Economic Education, by Israel Kirzner, The Freeman, Oct 1998
Explains why economic education of both the general public and politicians/legislators is needed and why a teacher, such as Mises, must remain scientifically detached (value free) even if passionate about the teaching goals
"One of the most pervasive fallacies in public opinion has been that of seeing the gain that one participant derives from a market exchange as having necessarily been extracted and subtracted from his partner in that exchange. After all, if I profit from an exchange with my neighbor, that profit can only have arisen from my neighbor’s presumed, corresponding, loss. It is of course an elementary economic insight, yet one often entirely missed, that my profit must, at least prospectively, be in fact accompanied, not by a loss to my exchange partner (as in a 'zero-sum game'), but by profit to him (a 'positive-sum game')."


Economic Fallacies
    by Frédéric Bastiat, 1848
Partial contents: Abundance-Scarcity - Obstacle-Cause - Effort-Result - To Equalise the Conditions of Production - Our Products are Burdened with Taxes - Balance of Trade - The Petition of the Candlemakers - Immense Discovery - Reciprocity
Economic Sophisms
    by Frédéric Bastiat, 1848
Partial contents: Physiology of Spoliation - Two Principles of Morality - The Two Hatchets - Lower Council of Labour - Dearness, Cheapness - To Artisans and Workmen - A Chinese Story - Post Hoc, Ergo Propter Hoc - The Premium Theft - The Taxgatherer

The introductory paragraph uses material from the Wikipedia article "Fallacy" as of 25 Nov 2018, which is released under the Creative Commons Attribution-Share-Alike License 3.0.