Think this page needs an overhaul - several bits here entirely misrepresent basic principles of economics.

(Non-comprehensive) Examples:

1.Note 5 - Perfect Information is NOT assumed as a matter of course in economic models, nor is it related to the rationality assumption: generally simple models will be constructed with perfect information, and then imperfect information will be added as you learn more complex econ. I think the cereal example here is really misguided - the decision to purchase name-brand cereals is not 'irrationality', but based on preference (in fact this example commits the fallacy of intrinsic value).

2. Note 7 - Misuse of coase theorem (which is to do with allocation of PROPERTY rights leading to an efficient outcome). I accept that civil liberties shouldn't have a bearing on economic efficiency, but there is a decidedly inverse relationship between workers rights (which I take to mean their power to set wages/minimum wages/etc) and efficiency. The more powerful workers' organisations, the further away from efficient free-market levels wages are set. In a generally free market state this leads to higher unemployment: http://en.wikipedia.org/wiki/Calmfors%E2%80%93Driffill_hypothesis (usually we'd be on the left hand side of the hump in a modern developed economy).

3. Note 8 - my issue is with the caveat someone has clearly tacked on here. There is no fear that people will suddenly stop buying govt bonds (in fact, yields are extremely low). The worry is that they will become more expensive as risk premia increase (but again, this isn't too significant a worry).

4. Note 9 - 'In Real Life, monopolies are hard to maintain without at least either blatantly criminal means or collusion/support by the government.' - ??? First, a monopoly does note collude (there is no one to collude with), secondly, this completely contradicts the point the author was trying to make that free markets don't equal monopolies! If you have to make something illegal to stop it, then it would obviously occur in a free market!

The article says: "In Real Life, monopolies are hard to maintain without at least either blatantly criminal means or collusion/support by the government.". This assumes that the laws are written in this way. In a "pure" free market system monopolies tend to be stable because the dominant player can:

1: Write contracts that exclude the competition ("if you buy anything from my competitors, you can buy nothing from me: which do you need more?", or "You pay me a royalty for every computer you sell, regardless of whether it contains my operating system")

2: Write contracts with the competition to divide up the market ("I'll bid on this and you bid on that").

3: Tie goods and services together to leverage dominance in one market into dominance in another ("If you buy my oil then you have to have it delivered by my tankers")

Someone put in the poverty has been decreasing in the USA. The actual figures, which I put a link to, prove otherwise.

This is just normal for (generally Right Wing) tropers to make various claims without any factual basis.

I also reported that a true "Free Market" has never existed in real life. A free market (according to The Other Wiki) is a market in which there is no economic intervention and regulation by the state, except to enforce private contracts and the ownership of property.

From the regulation of weights and measures, anti fraud laws, tariffs, taxes, subsides, trade restrictions, etc, there is no government that has done this. Of course, you may have a different definition of "Free Market".

But the USA has never had this, one of the first laws pass by the US Congress was a tariff act.

the rationality issue contains a faulty example in my opinions: [quote]A good example of this can be seen in any given grocery store that stocks both name-brand and generic versions of the same product, like breakfast cereals. Generic breakfast cereals are invariably cheaper than name-brand cereals, usually identical in quality, and sometimes even contain slightly more food per box/bag (for the same or cheaper price). If the ridiculous rationality fallacy were real one would expect generic cereals to constantly sell out and name-brand cereals to be shelf-warmers. In reality, the opposite is true. Sales for name-brand cereals leave the generics in the dust, mostly because consumers come to the (irrational) conclusion that name-brand cereals are better because they come in colorful boxes and/or are promoted by entertaining cartoon characters and/or because, if the brand name cereal turns out to be of inferior quality, the consumer has a multi-billion dollar corporation to shun/sue.[/quote]

The problems with this claim: 1. Most generic breakfast cereals contain more sugar per gram. 2. Most generic breakfast cereals ARE lower quality. 3. You cannot sue a company for producing lower quality goods, only for producing dangerous and unhealthy goods.

Point 2 seems to contradict itself. Inflation comes from wealth being a zero sum game, but it is listed as a fallacy on the next item.

Also, the USA example is not good, because the USA economy is not a closed system. USA as a whole can be seen as "stealing" from poorer countries

Is there a difference between simply not mention the economic system and you fail economics forever? Is it possible to build a world and not even offer the slightest clue about how the economy operates?