Economic debates are dominated by stupid misconceptions, so it is difficult to pick one as the most pernicious of them all.

But if anyone is up to this difficult task, it must be me.

One error; one misconception; one outright falsehood is at the root of so many economic myths that I think it should take the prize as the most damaging: that there is only so much “work” in the world, and therefore only so many “good jobs at good wages” to go around.

Opposition to free trade is often based upon this fallacy: if we open our markets to cheaper foreign goods, somehow Americans will be less well off because we are exporting jobs that could be done here by higher-wage American workers.

New technologies are often feared for the same reason. Robots will replace human workers, and newer, more efficient technologies will eliminate the need for millions of lower-skilled jobs across the land.

Immigrant labor takes the same hit (I speak now of immigrants, not illegal immigration, which is a law-enforcement issue); if a “wave of immigrants” floods the United States, millions of native-born Americans will lose their jobs to cheaper and harder working foreigners.

The root of all these myths is infantile economic thinking.

Simply put, economic activity is the exchange of goods and services between willing people who expect to be made better off through their exchanges. As long as the information is good and fraud is not involved, the more exchanges, the better.

Trade creates a virtuous circle. Wealth, in fact, is created. ,p> It is through trade that we get the division of labor. None of us wind up farming our own food, making our own clothes, or milking the cow for our coffee cream just because nobody else will.

It is through trade that the financing of huge complex semiconductor factories building entirely novel and useful products is stimulated. It is through trade that work—and jobs—that never would or could exist in a world of simply autonomous individuals is created. Continued...