Incentives matter . Private ownership promotes responsibility and cooperation. Trade creates wealth. Profits direct businesses toward activities that increase wealth.
Competition increases efficiency and innovation.
Taxation and regulation discourage production and destroy wealth . Political decision-making favors plunder over production. Central planning wastes resources and retards economic progress. He went on to say that nine-tenths of the economic fallacies that work harm in the world today are the result of ignoring this lesson. While Hazlitt's Lesson is not exactly a separate economic principle, it is a form of mental discipline that must be exercised when constructing or analyzing policy.