RichardKennaway comments on Open Thread, October 1-15, 2012 - Less Wrong Discussion
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Instead, someone else goes unclothed.
More generally, if everyone drinks the tea and produces only 3/4 as much, everyone, on average, will be 1/4 poorer. Price movements only affect how the poverty is distributed. (Of course, they also affect what new resources are tapped, what new inventions are made, how hard people will work during their reduced hours, how existing resources are redistributed among their uses, and how effort will be redistributed among the different productive activities, but that is going beyond the purpose of the parable.)
Yvain's premise is that the country is warm, so people only make clothes to show off their wealth, ability to sew, and taste in fashion. Someone decides "I was already reluctant to buy those expensive rags, now they're just too expensive" and joins the ranks of streakers.
So is demand for cloth elastic, or is it not?
That's the parable of the broken window.