Natural Disasters Still Aren’t Good for the Economy

By Art Carden 

Tornado season is in full swing (US), and late April saw big storm systems that did serious damage in parts of Arkansas, Mississippi, and Alabama. Hurricane Season is but a few months away. Just as every year brings weather disasters to some places, every year also brings stories claiming that disasters are good for the economy (here’s a 2011 example from the New York Times). As I have written here before, though, stories like these make an elementary mistake by focusing on the new bursts of economic activity while ignoring the alternative uses of those resources…

 

broken-window-fallacy

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