12/22/08 - EconLog by Bryan Caplan
People propose policies and explanations without thought of the consequences or any examination of likely causes. Caplan talks about separating twins in school, and reasons given for economic success or failure.
[edited] Schools ususally put twins in different classes. The main rationale is that they will make new friends. They will, but that doesn't mean you are doing them a favor. Twins put less effort into making new friends because they already have a better friend than most of us will have. The marginal benefit of making new friends is unusually small.
There is no reason to target twins. Do kids benefit from making more new friends than they naturally want to? If you believe that, you would separate as many children as possible from their current friends. Will they thank you later? If you are certain that separation is the right answer, why not try a little self-experimentation? Cut the time you spend with your best friend in half, and tell us how you like it.
A decade ago, pundits said (wrongly) that the Japanese economy was doing well because their factories were destroyed during World War II. So, they built new factories and competed better than the victors with their musty old factories. Economists replied: If that is true, all we need to do is bomb our own factories!
Don't be fooled by pundits or by make-work bias. When the government applies some policy that interferes with people's lives and businesses, officials point proudly at all of the increased activity that results. They ignore the damage that this activity is aimed at correcting.
When you step on an ant hill, and see the ants rush out and mill around, the ants aren't better off because they have been put to work.