Guest post by Ed Crooks, US industry and energy editor
A pleasurable consequence of my research into the economic impact of the giant storm Sandy was that I spent spent some time reading the work of the great French economist Frédéric Bastiat, who more than 160 years ago set out the foundations for the way we still think about the economics of natural disasters today.
Bastiat is not as well-known as he deserves to be in the English-speaking world, perhaps because of a reflexive Anglo-American view that “great French economist” is a contradiction in terms. But as the collection of his work at the excellent website bastiat.org makes clear, he was a brilliant man: full of sharp and original insights expressed in his distinctively pithy style.
The description of the famous “broken window fallacy”, which explains why natural disasters do not make an economy better off, is a case in point, packing a wealth of ideas into just 846 words. Read more