Pat Gunning asked:  
> how prominent economists have used the  
> term fallacy. What have they regarded as fallacies?  
  
  
 "Why protection retains such popular strength in  
spite of all exposures of its fallacies" (p. v)   
Henry George, Protection or Free Trade, 1883.  
  
The concept of the pure free market, and the fallacy  
that trade barriers are beneficial, goes back at least  
to the Physiocrats, who espoused laissez faire. To  
them, free trade required the abolition of taxation  
other than the impot unique, a tax on the "net  
product" which we today call the "economic rent" of  
land.    
  
Henry George added a moral dimension to the concept of  
a free market, arguing that not only does the taxation  
of wages and other interventions have an excess  
burden, but that it is morally wrong to tax labor and  
otherwise interfere with free trade.  
  
I suspect today's libertarian opposition to taxation  
originates with Henry George's works, even while  
ironically today's libertarians are mostly opposed to  
his ideas.  
  
Previous 19th-century anarchists such as Lysander  
Spooner had moral arguments against imposed  
government.  But their economic arguments were limited  
in not confronting the land issue.  Spooner, hower,  
did use England as an example of a realm that was  
financed from land rents.  
  
Thus, the concept of the pure free market, and the  
corollary, the fallacy of market failure, and its  
relationship to the land issue, does indeed invoke the  
history of economic thought.  
  
Fred Foldvary