Essays on Political Economy, M. Frederic Bastiat
Essays on Political Economy
M. Frederic Bastiat
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Claude-Frédéric Bastiat was a French economist, writer and a prominent member of the French Liberal School. A member of the French National Assembly, Bastiat developed the economic concept of opportunity cost and introduced the parable of the broken window. He was described as “the most brilliant economic journalist who ever lived” by economic theorist Joseph Schumpeter. In his 1850 essay "Ce qu'on voit et ce qu'on ne voit pas" ("What is seen and what is not seen"), Bastiat introduced through the parable of the broken window the concept of opportunity cost in all but name. This term was not coined until over sixty years after his death by Friedrich von Wieser in 1914.

Essays on Political Economy

by
M. Frederic Bastiat


That Which Is Seen, and That Which Is Not Seen

Introduction

In the department of economy, an act, a habit, an institution, a law,gives birth not only to an effect, but to a series of effects. Of theseeffects, the first only is immediate; it manifests itself simultaneouslywith its cause — it is seen. The others unfold in succession — they arenot seen: it is well for us if they are foreseen. Between a good anda bad economist this constitutes the whole difference — the one takesaccount of the visible effect; the other takes account both of theeffects which are seen and also of those which it is necessary toforesee. Now this difference is enormous, for it almost always happensthat when the immediate consequence is favourable, the ultimateconsequences are fatal, and the converse. Hence it follows that thebad economist pursues a small present good, which will be followed by agreat evil to come, while the true economist pursues a great good tocome, at the risk of a small present evil.

In fact, it is the same in the science of health, arts, and in that ofmorals. If often happens, that the sweeter the first fruit of a habitis, the more bitter are the consequences. Take, for example, debauchery,idleness, prodigality. When, therefore, a man, absorbed in the effectwhich is seen, has not yet learned to discern those which are notseen, he gives way to fatal habits, not only by inclination, but bycalculation.

This explains the fatally grievous condition of mankind. Ignorancesurrounds its cradle: then its actions are determined by their firstconsequences, the only ones which, in its first stage, it can see. It isonly in the long run that it learns to take account of the others. Ithas to learn this lesson from two very different masters — experience andforesight. Experience teaches effectually, but brutally. It makes usacquainted with all the effects of an action, by causing us to feelthem; and we cannot fail to finish by knowing that fire burns, if wehave burned ourselves. For this rough teacher, I should like, ifpossible, to substitute a more gentle one. I mean Foresight. For thispurpose I shall examine the consequences of certain economicalphenomena, by placing in opposition to each other those which areseen, and those which are not seen.


I
The Broken Window

Have you ever witnessed the anger of the good shopkeeper, James B., whenhis careless son happened to break a pane of glass? If you have beenpresent at such a scene, you will most assuredly bear witness to thefact, that every one of the spectators, were there even thirty of them,by common consent apparently, offered the unfortunate owner thisinvariable consolation — “It is an ill wind that blows nobody good.Everybody must live, and what would become of the glaziers if panes ofglass were never broken?”

Now, this form of condolence contains an entire theory, which it will bewell to show up in this simple case, seeing that it is precisely thesame as that which, unhappily, regulates the greater part of oureconomical institutions.

Suppose it cost six francs to repair the damage, and you say that theaccident brings six francs to the glazier’s trade — that it encouragesthat trade to the amount of six francs — I grant it; I have not a word tosay against it; you reason justly. The glazier comes, performs his task,receives his six francs, rubs his hands, and, in his heart, blesses thecareless child. All this is that which is seen.

But if, on the other hand, you come to the conclusion, as is too oftenthe case, that it is a good thing to break windows, that it causes moneyto circulate, and that the encouragement of industry in general will bethe result of it, you will oblige me to call out, “Stop there! yourtheory is confined to that which is seen; it takes no account of thatwhich is not seen.”

It is not seen that as our shopkeeper has spent six francs upon onething, he cannot spend them upon another. It is not seen that if hehad not had a window to replace, he would, perhaps, have replaced hisold shoes, or added another book to his library. In short, he would haveemployed his six francs in some way which this accident has prevented.

Let us take a view of industry in general, as affected by thiscircumstance. The window being broken, the glazier’s trade is encouragedto the amount of six francs: this is that which is seen.

If the window had not been broken, the shoemaker’s trade (or some other)would have been encouraged to the amount of six francs: this is thatwhich is not seen.

And if that which is not seen is taken into consideration, because itis a negative fact, as well as that which is seen, because it is apositive fact, it will be understood that neither industry in general,nor the sum total of national labour, is affected, whether windows arebroken or not.

Now let us consider James B. himself. In the former supposition, that ofthe window being broken, he spends six francs, and has neither more norless than he had before, the enjoyment of a window.

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