Mike Munger
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Economist and frequent EconTalk guest
Claims by Mike Munger (20 of 43)
Buying stock in a multinational corporation building a manufacturing plant in a poor country would help its workers more than fair trade premiums, because the capital-intensive enterprise raises the marginal product and wages of factory workers, and as people leave coffee plantations for factories, coffee workers' wages get bid up too.
Following Hayek, society may legitimately guarantee a minimum subsistence to workers who lose jobs through morally arbitrary economic change, but must never guarantee their existing income stream, because doing so insulates people from forecasting and adapting to the dynamic process that generates prosperity.
Environmental and labor-safety regulations are luxury goods: poor people worried about feeding their families tomorrow rationally prefer higher take-home pay over safer conditions, so such regulations only emerge once a middle class of sufficient size demands them politically—and cannot be successfully imposed from outside.
Imposing US safety regulations on poor-country workers is arrogant paternalism, and the labor/environmental-standards provisions of trade agreements are really a 'bootleggers and Baptists' arrangement: protectionists wanting to keep US jobs use the moral language of caring about poor workers as cover.
People who object to not-euvoluntary transactions persist in their opposition even after being shown the ban makes the worst-off party worse off, because their real objection is preferring not to live in a world where such things are monetized—it functions as a preference, not a factual error.
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