Some Important Development Links

|Peter Boettke|

Bill Easterly responds to Frank Fukuyama's NYT book review of The Constitution of Liberty.

Chris Blattman discusses sweatshops in Africa and the relevant alternatives that decision makers face. (why else might I think this post is cool besides the fact that it is about development and is on a topic that Ben Powell is AWESOME on?)

Both make important points in my mind about "the potential and limits of socially organized humankind". (Where did that phrase come from?)

What is your reaction to reading these posts and the debates from which they spring?

Comments

[Cornelius]

The problem with the Skarbek paper is that if management closely monitors sweatshop employees, then the employees will be scared of saying anything bad about their working conditions, for fear of being fired.

The dilemma with sweatshops is not wages per se, but rather the working conditions themselves. The corporations engaging in sweatshop labour are not abiding by international labour standards that their own countries agreed to. It is therefore the responsibility of citizens to call them out on this point.

[EmilySkarbek]

Cornelius,

Any bias in the interviews shows that those workers who volunteered were more likely to discuss the negative aspects of their job. No management was present during any of the worker interviews and confidentiality was communicated both orally and through a written agreement signed in the presence of the worker. Even if that were a significant problem, it does not diminish the relevance of data communicated about previous sweatshop employers.

Second, the whole point of the paper was to examine the non-monetary aspects of compensation including the working conditions. See Table 3 in the paper.

[Mario S]

As you said in 2008, James Buchanan: http://austrianeconomists.typepad.com/weblog/2008/02/why-does-capita.html

[Rafe Champion]

Using the term sweatshops puts a bias on the discussion from the start, like the way the English factories were described by the anti-factory propagandists. In each case you have to look at the alternatives and you have to look at a time series to see how things got better as productivity improved.

[Cornelius]

It is an honour to have one of the paper's authors respond directly! Thank you Emily Skarbek.

First of all, I did not mean management directly affected your study. Rather, I suggest that oppressive and overzealous management can instil fear in workers. This is a psychological point that is hard to overcome, and of course I appreciate that.

Secondly, I did not mean to criticize your study for not emphasizing non-pecuniary benefits. I was merely speaking in general terms.

[Ecommerce website developer]

This blog gives great opportunity to learn on new developments in the technology which helps to explore knowledge on various services.I must appreciate your efforts on posting these information.

[Rafe Champion]

Cornelius, have you revised your opinion about so-called sweatshops, or do you still think that the workers should be laid off if they are not paid according to the terms of international agreements? What are the criteria for setting those terms? Do they have anything to do with the capacity to pay, and the productivity of the workers, and the options that are available to them, and whether they actually want to take on the work, regardless of the views of distant bureaucrats?

[Jim McClure]

How many Skarbeks does it take to put in a light bulb?

Just a joke; lighten up, lighten up.

BTW: Great job Emily et al.!

[Cornelius]

Hey Rafe. I used to be in favour of sweatshops as well - but the sweatshop versus no jobs dichotomy is false. The reason we escaped the workshop phase in our own Western societies is not solely due to exogenous "productivity shocks", as some economists propound, but rather largely due to working class direct action, which turned attention to the disparities.

The movement against sweatshops thus focuses primarily on the labour standards issue. It is hard for even you to argue, I imagine, that a company like Foxconn protects workers' basic rights and freedoms. Of course, corporations are protected by government-sanctioned limited liability clauses, and therefore are not held responsible for their own actions.

[Troy Camplin]

For some reason people think cultures can just jump stages of development, ignoring the historical development of the West. The West went through child labor and sweatshops because those were better than the alternatives at the time. The creation of wealth allowed us to have better conditions an put our children in school rather than to work. The people who think we can skip stages in developing countries are thus responsible for the increase in child prostitution in those countries where they have been successful at eliminating child labor -- because those families still have to eat. The problem is that people are making what are essentially aesthetic judgments -- sweatshops and child labor are "ugly" to their eyes -- and are willing to starve people so they don't have to see the ugliness.

[Cornelius]

Hi Troy, very interesting comment, thanks. Unfortunately, it's still a false dichotomy you are employing in your argument: either sweatshops, or no jobs. Sweatshops may indeed improve the lot of the impoverished, as you suggest. But is that the only criteria a libertarian should stand for? Absolutely not!

Slavery, too, improved the health of those Africans who arrived in North America to become slaves (as judged by heights, food allocations, other quantitative evidence) - the United States had more food and better comforts than Chad, Niger, etc. So does that automatically make slavery right to you? Of course not. A libertarian would argue that slavery is wrong because it does not matter how well the slave is compensated - he/she is denied of freedom.

Anyway, have a good one!

[Troy Camplin]

YOu create a false dichotomy. People who work in a sweatshop do so voluntarily. Slaves by definition did not enter into such voluntarily. That makes a huge difference as to what a libertarian supports. If nobody is being forced into the sweatshop to labor, then I can think of no libertarian reason to oppose them. And since they improve the lives of the workers, as you imply, then what opposition can there be other than aesthetic? I'm an artist, so I tend toward the aesthetic, but I'm not so Euro-American-centric believe everyone should be at the same level of development as we are right this very second, no matter the consequences. You're right, the dichotomy isn't necessarily sweatshops or no jobs -- it's sweatshops or less productive, less income-generating jobs. It is an unvirtuous aesthetics that will condemn people to worse lives for following it.

[Rafe Champion]

Cornelius, the original research claimed that the workers favoured their employment on several margins, not just the money. It has been observed elsewhere such as Vietnam that the factory work is not only better paid than the alternatives but also lighter and in better conditions (like out of the weather).

BTW on your historical comments, what is your problem with child labour in the cotton factories in England? Check out W H Hutt's correction to the misleading histories that are based on the absurd Saddler report.

http://www.the-rathouse.com/Revivalist4/RC_FactorySystem.html

And what was the working class direct action that you mention, was that the sabotage and arson of the luddites and others? Or just violent trade union activity? Check out Hutt on that as well.

http://www.the-rathouse.com/2007/BH_Unions.html

[Cornelius]

Hey Troy and Rafe, thanks for responding to my comment. I understand where you two are coming from, since I used to think along the same lines until I did further investigating.

Troy, please read American political history. If you have, then you'll recall that Abraham Lincoln and the Republican party flew under the banner of ending wage slavery as well as chattel slavery. The two are inextricably linked, since wage slavery denies men and women a viable set of options that unleash their creativity and individuality, and inhibits democracy in the workplace.

Thank you for your essays Rafe, but unfortunately I won't have time to read them - though from what I can tell your style of writing is eloquent. Regardless, it is important to remember that working class action and militancy gave us many of the freedoms and comforts we take for granted today. Men like Robert Owen and Henry Hetherington, and women like Frances Trollope, saw the conditions of the working classes, and were able to end child labour and horrid work conditions.

Also remember that the factory system doesn't need to be oppressive to be profitable. Robert Owen's New Lanark model worked exceedingly well, involving a high level of democracy and equity, while still yielding a profit. Corporations today know that they can introduce such emancipation into sweatshops, but given their power structures, are hesitant to do so.

I think, Rafe and Troy, you emphasize the profit motive and property rights over democracy and freedom. Fair enough, I guess, though I am the opposite. ;)

Have a good one!

[Troy Camplin]

There is no freedom without property rights. I support the freedom of people to choose what is best for them, not what I or some do-gooder thinks is best for them. I have more respect for peolpe than that. Freedom means the freedom to choose their values and value rankings, not to have to adopt mine. As for democracy, your statement about "democracy in the workplace" only demonstrates you don't know what democracy is. It is not found in the workplace. It is a form of law selection (or, in a democratic repubic, of lawmaker selection). That is all. \

I know my history. The laws always have followed the social reforms, not vice versa. The result has been that the government of the time has taken credit for what has already taken place in the vast majority of firms, for example. We see it in all sectors, from health improvement to safety, and education. If you knew your actual history rather than your government school history (which may have some pro-government biases, as you can well imagine), you would understand this. This is why the West is wealthy, by the way, and the developing nations, where do-gooders try to impose conditions of highly developed nations onto less developed ones to the detriment of everyone in those countries. But I suppose actual outcomes don't matter, so long as you have good intentions, right?

[J Oxman]

Cornelius,

Lincoln didn't have much interest in ending slavery. They had the interest of maintaining the union. After all, slavery was not outlawed in the non-secessionist states.

[Rafe Champion]

I suspect that Cornelius is what Roger Koppl called an "edge troll". The idea of starting in favour of so-called sweatshops and becoming less supportive as you learn more lacks credibility. The same applies to the comments on the role of militant labour in improving working conditions. The issue of slavery is a complete red herring. Etc.