The Broken Window Fallacy

The broken window fallacy is the idea that whenever we observe economic activity, that we are going to acquaint that with value creating economic activity. A cansian would object to that by saying, yes, that holds true in a situation of full employment. But when resources are not being fully utilized, there is no opportunity cost. If you really understand that all resources have alternative uses, then who's to say that withholding a resource from the market isn't in some sense a use? In fact, that sort of withholding is precisely what we would expect in the wake of a depression as resource owners search for best ways to refit their assets.