The misunderstanding of economics contributes to poverty. The Austrian economists tend to write about this. For example, the minimum wage essentially makes it illegal for very unskilled workers to work. This was dramatically illustrated when the US government imposed a higher-than-market minimum-wage on the island of American Samoa and decimated the economy.[1]
An economically-naive do-gooder, considering that a minimum wage helps poor people, might work hard for its passage, not understanding that the minimum wage actually hurts poor people.
He made the opposite statement: Austrian economics contributes to ending poverty. If you have time, watch this documentary by Milton Friedman: http://freetochoose.tv
dpatru|14 years ago
An economically-naive do-gooder, considering that a minimum wage helps poor people, might work hard for its passage, not understanding that the minimum wage actually hurts poor people.
[1] Peter Schiff gives an excellent explanation of the result of the minimum-wage on American Samoa: http://www.youtube.com/watch?v=X25U_7mx9jU
olalonde|14 years ago