As we often say in class, economics is about thinking on the margin. Statement "tobacco taxes rose, but my friend carried on smoking, so economics is rubbish". No. Your friend might be inframarginal. It's very likely that for a person on the margin, they will stop smoking.
Another way to say this is that economic thinking is systems thinking. Don't just think about the consequences for your friend, but for the system as a whole. And the system as a whole will be influenced by marginal smokers.
Here's an application of that.
1. The Earned Income Tax Credit subsides workers on a low wage and is much more generous for workers with children. See the discussion in Leigh, https://docs.iza.org/dp4960.pdf.
2. What happens when it is introduced? One non-marginal model is to say: well, if more workers with children work, that raises supply and lowers the wage of low paid workers with children.
3. The marginal argument is different. If the supply of labour rises, then wages will fall for all marginal workers, those with and without children.
4. what does the paper find?
"Although the EITC has a much larger effect on the labor force participation of workers with children than those without, the wage effect appears to be similar for workers with and without children. This suggests that what matters is the average EITC rate in a labor market, not an employee’s own EITC rate."
So when someone tells you how beneficial tax credits are, think of the system. Subsidising firms to pay low wages has systemmatic effects.