In the 1960s, my grammar school (grades 1-8) encouraged us to buy cheap kids books; they had lists and we checked off what we wanted and paid for them. They were cheap; these were not new releases, and they were paperbacks (a bit taller and wider, and thinner, than standard paperbacks). Not a lot of pictures as I recall.
The one I want to i.d. is about a young boy in a small (maybe rural) town. There is nothing supernatural going on, certainly no violence, it's just him and some amusing local characters. The only part I remember is a container, or maybe it's invisible dust, that is supposed to improve everything. The joke is that the container is empty - or the 'dust' is nonexistent - so people just think it works. In the end someone adds water, and says it was the best, wettest water ever.
I'm pretty sure there were multiple stories in the book, and other books with the same boy and characters. I'd like to i.d. this so I can buy it for my grand-nephews.