Quotulatiousness

March 12, 2018

The pesky and persistent gap between what men earn and what women earn

Filed under: Britain, Business, Economics — Tags: , , , — Nicholas @ 05:00

Tim Worstall responds to yet another Guardian article decrying the difference in earnings for men and women:

There is a gender earnings gap in British – as with all others – society. The interesting question is what is causing it, the important one what we do about it. The answers being, in turn, children and nothing.

This is not, you will note, the general direction of the political conversation. It does have the merit of being true on both counts.

Take this finding that there are lots more highly paid men out there:

    There are almost four times more men than women in Britain’s highest-paid posts, according to “scandalous” figures that show the extent of the glass ceiling blocking women from top jobs.

    Government data reveals the huge disparity in the number of men and women with a six-figure income, fuelling concerns over the gender pay gap in the City and other professions.

    There were 681,000 men earning £100,000 or more in 2015-16, according to new HMRC data. It compares with only 179,000 women. The latest figures show that 17,000 men earned £1m in 2015-16, while only 2,000 women did so.

Those numbers are true. There are more men earning higher incomes than there are women. This is the entire and whole driver of that gender pay gap – or what it actually is, a gender earnings gap. And what is the cause of this? As the TUC has pointed out [PDF]:

    There is an overall gender pay gap of 34 per cent for this cohort of full-time workers who were born in 1970. This gap is largely due to the impact of parenthood on earnings – the women earning less and the men earning more after having children.

That really is just about all there is to it. It’s illegal, and has been for decades, to pay people differently based solely upon their gender. People doing the same job get the same pay by gender – there’re fortunes to be made dobbing in employers where this isn’t the case and we don’t see such dobbing in happening.

[…]

We can also point out that the true answer here is entirely in womens’ hands. Granny knew how to manage G-Pops, Lysistrata shows the Ancient Greeks got the point. If the only way men got nookie and or children was by being house husbands then there wouldn’t be a gender earnings gap, or it would run the other way. That women don’t strike for this – perhaps that not enough do – shows that this might well not be what women actually want.

OK, maybe not in womens’ hands but certainly in their control….

March 8, 2018

Frictional Unemployment

Filed under: Economics — Tags: , , — Nicholas @ 04:00

Marginal Revolution University
Published on 1 Nov 2016

Finding a job can be kind of like dating. When a new graduate enters the labor market, she may have the opportunity to enter into a long-term relationship with several companies that aren’t really a good fit. Maybe the pay is too low or the future opportunities aren’t great. Before settling down with the right job, this person is still considered unemployed. Specifically, she’s experiencing frictional unemployment.

In the United States’ dynamic economy, this is a common state of short-term unemployment. Companies are often under high levels of competition and frequently evolve. They go out of business or have to lay off workers. Or maybe the worker quits to find a better position. In fact, millions of separations and new hires occur every month accompanied by short periods of unemployment.

Frictional unemployment helps allocate human capital (i.e. workers) to its highest valued use. Hopefully, workers are similarly finding themselves with more fulfilling jobs. Even when it’s caused by an event such as a firm going out of business, frictional unemployment is a normal part of a healthy, growing economy.

March 6, 2018

Real estate reality may finally be changing minds in Silicon Valley

Filed under: Business, Technology, USA — Tags: , , , — Nicholas @ 03:00

I’ve never lived in Silicon Valley, and my one vist there was over 25 years ago — but even then, I thought the real estate market was far higher than it should have been. The sale of a tiny house in Sunnyvale (for $2 million or $2,358 per square foot) is symbolic of real estate values all around the area, as the stories get told of new employees living in their cars because even on six-figure salaries, they can’t afford to buy or even rent near where they work. Iowahawk linked to a New York Times article which shows that some movers and shakers acknowledge that Silicon Valley has a serious problem:

March 2, 2018

Defining the Unemployment Rate

Filed under: Economics, USA — Tags: , , — Nicholas @ 02:00

Marginal Revolution University
Published on 18 Oct 2016

How is unemployment defined in the United States?

If someone has a job, they’re defined as “employed.” But does that mean that everyone without a job is unemployed? Not exactly.

A minor without a job isn’t unemployed. Someone who has been incarcerated also isn’t counted. A retiree, too, does not count toward the unemployment rate.

For the official statistics, you have to meet quite a few criteria to be considered unemployed in the U.S. For instance, if you’re without a job, but have actively looked for work in the past four weeks, you are considered unemployed.

In times of recession, when people are faced with long-term unemployment and lots of discouragement, the official rate might not count some of the people that you would otherwise consider unemployed.

This video will give you a clear picture of how the unemployment rate is defined and build a foundation for further understanding this important facet of labor markets.

February 27, 2018

Many Americans feel that the elites have “betrayed and abandoned them for a mess of virtue signaling and glib ideologizing”

Filed under: Politics, USA — Tags: , , , , , — Nicholas @ 05:00

ESR on the fraught subject of US immigration policy:

Crime is a real issue. Legal immigrants have a slightly higher criminal propensity than the native born (the difference is small enough that its significance is disputed) but illegals’ propensity is much higher, to the point that 22% of all incarcerees are illegals (that’s 92% of all jailed immigrants).

But the elephant in the room is the impact of illegal immigration on social trust.

Diversity erodes social trust, trust being that extremely valuable form of social capital that enables people to make handshake deals, leave their doors unlocked, and trust institutions to treat them fairly. Sociologist Robert Putnam was so shocked to discover this that he sat on his results for seven years before publishing. In diverse communities trust drops not only between ethnolinguistic groups but within them. It’s insidious and very harmful – low-trust societies are bad, bad places to live.

The U.S. has a proud tradition of assimilating legal immigrants into a high-trust society, but it succeeds in this by making them non-diverse – teaching them to assimilate folk values and blend in. Putnam’s work suggests strongly that without the ability to rate-limit immigration to be within some as yet undetermined maximum, the harm from erosion of trust would exceed the benefits of immigration.

We are probably above the optimal legal immigration rate – the highest compatible with avoiding net decrease in social trust over time – already (later in this post it will become obvious why I believe this). There is little doubt that we would greatly exceed it without immigration controls.

Anyway, even if ending border enforcement were a good idea (and I conclude that it is not, despite my libertarian reflexes) it’s a political nonstarter in the U.S. Trump got elected by appealing to sentiment against illegals, and beneath that is a phenomenon one might call Putnam backlash; everywhere outside a few blue-state enclaves, Americans sense the erosion of social trust and have connected it to illegal immigration.

And on the very strong divergence of opinion between the elite (very pro-immigration) and non-elite (becoming much more anti-immigration over time):

One of the major forces currently poisoning our politics is a breakdown in trust between people like you and me – the cognitive elites – and the rest of America. Deplorables. Flyover country. Brexit, and Trump’s election, slapped me upside the head. I’ve been forced to confront some uncomfortable truths.

They think we’ve betrayed and abandoned them for a mess of virtue signaling and glib ideologizing. On the left: identity politics, PC, and open borders justified on multiculturalist grounds. On the right: free trade and open borders justified on laissez-faire principle.

They have a point. I’m seeing that now.

I mean, I might still think free trade is a good idea and have lots of arguments for it. But my arguments don’t mean fuck-all to a Rust-Belt steelworker who’s watched his livelihood get exported and the community around him wither and has nothing left but a cheap high on opioids. Nor to an unskilled black or legal-immigrant urbanite who can’t get a job because the restaurants can hire illegals for cheaper.

We owe these people more than we have given them. What we owe can’t mainly be paid in money. It’s compassion; a fair hearing. Respect. Not dismissing them as trash or troglodytes because they don’t love the brave new globalized world that gives us options but – too often – closes off theirs.

I don’t have easy solutions to these problems. But is it too much to ask that people like you and me should stop being arrogant assholes about them?

February 24, 2018

Is Unemployment Undercounted?

Filed under: Economics, Government, USA — Tags: , , — Nicholas @ 04:00

Marginal Revolution University
Published on 25 Oct 2016

You may recall from our previous video that to be counted in the official unemployment rate in the U.S., you have to be an adult without a job and have actively looked for work within the past four weeks. That means that if someone has given up looking for a job, even if they want one, they are no longer counted under the official definition.

Does this mean that unemployment is undercounted? In other words, is the unemployment rate in fact higher than is reported?

Some have claimed this to be the case. However, unemployment is a tricky statistic. It’s important to consider that adults without jobs can fall into different categories. Many retirees, for example, are willing to leave retirement and take a job for the right price. If we are counting people that aren’t actively looking for employment, shouldn’t the retirees also be considered unemployed?

The simplest solution to this conundrum is to only count unemployed adults actively seeking work.

But what about discouraged workers — those who are unemployed and have not sought work in the past four weeks, but have sought work in the past year. Should we consider them in our calculations?

There are actually six different unemployment rates measured by the U.S. Bureau of Labor Statistics. The various rates have less and more stringent criteria. The official rate, called U3, falls somewhere in the middle. Another rate, called U4, does include discouraged workers in its calculation. All six rates follow a similar track over time.

So while the official unemployment rate may not be perfect, it does provide us with a good indicator of the state of the labor market and where it’s headed.

February 10, 2018

Protecting (some) women from their own decisions

Filed under: Business, Liberty, Politics — Tags: , , , , — Nicholas @ 03:00

Kirio Birks on the Formula One “grid girls”:

Objectification, we are told, is degrading. Why? Because any job that requires employees to be sexually attractive and gazed upon for that reason necessarily dehumanises them. It encourages others to treat them as pretty ‘things’ rather than as autonomous people with their own lives, passions, thoughts, and desires. Or so the thinking goes. ‘Grid Girls’ – models employed by Formula One for promotional purposes – have just discovered that their role is to be discontinued. As Formula One’s managing director of commercial operations explained: “While the practice of employing grid girls has been a staple of Formula 1 Grands Prix for decades, we feel this custom does not resonate with our brand values and clearly is at odds with modern day societal norms.”

But in their hurry to spare Grid Girls the indignity of the male gaze, nobody making this argument seems to have stopped to wonder whether Grid Girls might have an interest in defending what they do. Instead, a collective of ostensibly progressive voices leapt to their defence without bothering to ask the girls themselves if they needed defending at all. In response, Formula One abandoned its Grid Girls so that it can be seen to be moving with the times and hip to contemporary mores. In doing so, Formula One’s executives have implicitly conceded that they have spent too long objectifying women instead of empowering them. They would like it to known that they’d rather see women driving the cars, or as members of the engineering teams, or just about anywhere other than track-side holding a driver’s name-board and looking beautiful.

What baffles me is that a move supposed to empower women came at the expense of other women, and only because a minority of outsiders found Grid Girls inappropriate, problematic, and otherwise an offence against good taste. But even if Grid Girls are being objectified, then – contra the explanation offered above – it’s not at all clear that objectification is wrong in and of itself. It is acceptable to use people as a means to an end – that’s called employment. Grid Girls obviously know that they will be objectified and they make an autonomous, informed decision to take the job anyway. They are not harmed, they are paid for their time and their work, and many of them have come forward to say, with understandable indignation, that they enjoy what they do. Needless to say, this has not impressed those feminists who applauded their redundancies. But surely a woman has a right to be the object of somebody else’s desire if she wants and surely it doesn’t matter if she is being paid for it?

Opponents may suggest that Grid Girls have internalised their own oppression in a society shaped by patriarchal values, but not without making two claims: (1) that Grid Girls are unable to adequately think for themselves because of the society they live in and (2) that thinking for yourself is only evidenced by acknowledging the existence of a patriarchal status quo and resisting it.

February 4, 2018

QotD: Modern feminism

Filed under: Liberty, Politics, Quotations — Tags: , , , , , — Nicholas @ 01:00

Feminism now regularly calls for women to be treated as eggshells instead of equals. And through this, it does something pernicious to the women it claims to advocate for: Feminism has become a movement for female disempowerment, or what I call “encouraged helplessness” (from psychologist Martin Seligman’s “learned helplessness”—the feeling that there’s nothing you can do to escape your fate).

In fact, feminism, bizarrely, has morphed into paternalism — instructing women that they are fragile, passive, powerless victims who need authority figures to advocate for them.

That’s a movement I want no part of. Or, as I like to put it — because I’m neither a feminist nor much of a lady: Count me the fuck out.

If you’re a woman, I encourage you to join me — count yourself the fuck out of what feminism has become.

This doesn’t require you to be fearless. You just need to shove your fears aside and do what needs to be done — say, getting up on your hind legs and telling some co-worker, “Stop saying that thing to me” or “…treating me this way.”

Now, if they persist after you’ve told them to stop a few times, that’s harassment and you can seek support to get them to stop. But consider that it’s less likely to get to that point if you simply act like men’s equal—act as if you’re powerful — instead of acting like you’re a feminist.

Amy Alkon, “Are Women Really Victims? Four Women Weigh In”, Quillette, 2017-11-22.

February 3, 2018

Arizona’s legally protected blow-drying cartel

Filed under: Business, Government, Health, USA — Tags: , , , — Nicholas @ 05:00

Eric Boehm reports on the fantastic lengths protected businesses will go to to protect themselves from “unlicensed” competitors, even in such areas as hair drying:

Brandy Wells never anticipated the amount of vitriolic abuse she would receive over — of all things — her public support of a proposal to let people blow-dry hair without a state-issued license.

“I’ve been called a cunt, a bitch, an ass, trashy, a puppet, a pawn, repugnant,” Wells says. “And my favorite: ‘your logic on deregulation of cosmetology is much like your hair, dull and flat.'”

Wells says she’s received several attacks from cosmetologists on social media accusing her of being “uneducated” or “clueless” about cosmetology because she doesn’t work in the industry. It’s true that Wells isn’t a licensed cosmetologist (though she does, in fact, know how to use a blow-dryer, she confirmed to Reason), but that’s actually the precise reason why she’s speaking up.

Wells serves as the lone “public member” of the Arizona State Board of Cosmetology. That means she is the only member of the seven-person board who does not work in some capacity as a cosmetologist or with a connection to a cosmetology school. Last month, she voiced her support for House Bill 2011, which would removing blow-drying from the state’s cosmetology licensing requirements. Under current law, using a blow-dryer on someone else’s hair, for money, requires more than 1,000 hours of training and an expensive state-issued license. Blow-drying hair without a license could — incredibly — land you in jail for up to six months.

In response, Wells says, members of the cosmetology profession have sent messages to her employer, the Arizona Chamber of Commerce, suggesting that she should be fired — fired because she thinks people can safely blow-dry hair without 1,000 hours of training!

The cosmetology board is “a group of special interest bullies,” said Arizona Gov. Doug Ducey, a Republican, in his recent State of the State address. The board, Ducey said, “is going after people who simply want to make a living blow-drying hair. No scissors involved.”

This week, the fight over the so-called “blow-dry bill” spilled into the state legislature. The state House Military, Veterans, and Regulatory Affairs Committee held its first hearing on the bill, and licensed cosmetologists packed the room to speak one-by-one about the potential dangers of letting unlicensed professionals blow-dry hair

January 31, 2018

Tyler Cowen: The Economics of Choosing the Right Career

Filed under: Economics, Education — Tags: , — Nicholas @ 04:00

Marginal Revolution University
Published on 11 Oct 2016

As many who entered the labor market following the Great Recession know all too well, graduating with a college degree does not mean you’ll easily fall into a good career. Four-year college graduates with entry-level jobs actually earned more in 2000 than they’re earning today and student loan debt burdens are higher than ever.

Does this mean you should skip college or drop-out? Not necessarily. Unemployment is still lower for those with undergraduate and higher degrees. However, understanding the economics behind the labor market will make finding a career a more manageable task.

The labor market in the United States has undergone many changes in the past few decades. Whereas we once had many manufacturing jobs that required little training or specialized skills, the labor market today demands more people who can work with computers and information technology.

Choosing a good career requires planning beyond getting a college education. You’ll want to carefully consider the career options available for your major, as well any specialized skills you’ll need to build outside of the classroom.

It’s also essential to understand how supply and demand affect your career options. How many people are also choosing that major vs. how many employers are looking for those skills? Is a particular career path susceptible to being replaced by a machine? What about outsourcing in the global labor market? What about laws and regulation – does it require an occupational license?

There’s a lot to think about! Choosing a career is a huge decision and understanding how supply and demand rule the labor market will help you better navigate your future.

January 23, 2018

The unintended consequences of Ontario’s steep minimum wage hike

Filed under: Business, Cancon, Economics — Tags: , , , , , — Nicholas @ 05:00

Colby Cosh on the unpredictable outcomes of Ontario’s recent minimum wage increase:

In Thursday’s edition of this paper, Marni Soupcoff wrote an entertaining column about how Ontario’s fairly aggressive minimum wage increase had suddenly raised the costs of labour-intensive goods and services for consumers — the ones, that is, who don’t benefit themselves from a minimum wage increase. Child care, which is a very pure purchase of labour, is the example that is being exasperatedly discussed this week. The headline did not have “duh” in it, but that was the spirit of the thing.

Soupcoff pointed out that this not only could have been foreseen; an explicit warning of it was given in the pages of the Toronto Star, by the paper’s social justice reporter Laurie Monsebraaten. Our Financial Post section could perhaps easily be called the Social Injustice Gazette, but anyone at FP who got such an early jump on an economics story would be rightly pleased with himself.

Soupcoff’s major point was that the broad-sense law of supply and demand is not some plutocratic swindle devised by the Monopoly Man and his fatcat pals; even believers in “social justice” have to take it into account, as they take gravity into account when they are moving an old couch to a charity shop or sending cosmonauts into orbit. This is obviously right as far as it goes, but the words “supply and demand” are not enough, on their own, to predict the precise market response to a change in a price control — which is what the minimum wage is.

That, perhaps, is the true key point amidst all the various ideological struggles currently in progress over minimum wage levels, which are being yoinked upward in Alberta as well as in Ontario. A minimum wage is a price control. The minimum wage is not really so much a labour standard as it is the abolition of labour bargains that feature a nominal wage below the minimum. And price controls are a blunt instrument. Most economists, whatever their political orientation, instinctively resist them.

The incidence of a price control — the precise place upon which the economic burden of it falls — is not, in fact, foreseeable without other information. In the market for hired child care, for example, it could turn out, with time, that the real effect of increasing a minimum wage is that some parents drop out of the labour market and tend to their own children. It’s just not what one would actually predict, because the need for professional child care is something that a family tends to plan for well in advance, with a longer time horizon than any government’s. (Also, we haven’t invented dependable babysitting robots yet.)

Women, in particular, organize lives and careers around whether they expect their own labour force participation to be able to cover care expenses. Indeed, couples adjust family size for these expectations. We can even imagine circumstances in which a province’s extreme, credible commitment to a very high future minimum wage influenced birth rates.

January 13, 2018

QotD: Occupational licensing

Filed under: Bureaucracy, Business, Quotations, USA — Tags: , — Nicholas @ 01:00

When my mother retired from selling real estate, she toyed with the idea that she — a talented cook who had long made her own croissants — might make a little money on the side by selling homemade baked goods. It’s the sort of business that people have started from time immemorial, letting them share what they love with someone willing to pay for it.

A quick investigation, however, revealed that the thing was impossible. You can’t just bake a little stuff at home and sell it, for fear that you might poison people. If you want to poison people with your deliciously flaky homemade croissants, it must be done on a strictly ad-hoc, volunteer basis.

Welcome to the modern economy, where increasingly, everything not compulsory is forbidden. We are hedged around with rules to protect us, to protect other people, to protect some theoretical victim who exists only in the minds of regulators and judges. And there’s reason to worry that this red tape is getting wrapped so tight that it risks rendering us immobile.

I’m not talking about environmental regulations, or even the labor regulations that make it increasingly expensive and burdensome to employ people. Today I’m talking about occupational licensing, and the burden it places on people who want to build a career.

Megan McArdle, “You’re Gonna Need a License for That”, Bloomberg View, 2016-05-17.

December 29, 2017

2017 wasn’t all doom and gloom and Trump tweet wars

Filed under: Bureaucracy, Business, Government, USA — Tags: , , , , , — Nicholas @ 05:00

Veronique de Rugy manages to find three things that 2017 produced that somehow didn’t kill millions of Americans (so far, as far as we know):

First, President Donald Trump just signed a historic reduction in the corporate income tax rate, from 35 percent — the highest of all industrialized nations — to 21 percent. And except for a one-time repatriation tax, the U.S. will no longer tax most profits made by businesses overseas.

Both changes should boost economic growth and American workers’ wages. Moreover, the reform removes many of the distortions that discourage companies from investing foreign-earned income in the United States and prompt them to use tax avoidance techniques.

Second, this was a very good year for deregulation. Cutting taxes isn’t the only way to boost growth and raise wages; innovation may matter even more. Getting rid of duplicative and outdated regulatory hurdles to innovation promises to have a real impact on our lives. That’s what the Trump administration, with the help of Congress, seems committed to doing.

When the president first got to the White House, for example, he froze many not-yet-implemented Obama-era regulations. These include the punishing overtime pay regulation, which would have increased the cost of employing workers and ultimately reduced their base compensation to offset the increase in overtime pay.

[…]

Last but not least are the sustained efforts by Sens. Pat Toomey, R-Pa., and Richard Shelby, R-Ala., to slow down the process that would restore the Export-Import Bank, a bastion of cronyism, to its full and former glory.

Appointing enough board members to give Ex-Im a full quorum would instantly restore the agency’s ability to sign off on deals above $10 million for the benefit of a handful of very large foreign and domestic corporations. By resisting, the two senators are fighting a lonely fight on behalf of the unseen victims of corporate welfare.

December 19, 2017

The imminent threat of Neo-Victorianism

Filed under: Business, Education, Government, Media, USA — Tags: , , , , , , — Nicholas @ 05:00

Megan McArdle on the moral panic currently gripping modern American public life:

The same logic applies to the burdens of proof. If unsubstantiated claims are accepted at face value, then eventually enough will turn out to be false that many future claims will be disregarded — whether they are plausible or not, whether they are substantiated or not. That was the harm done by cases like the Duke Lacrosse scandal, the UVA rape case, the Tawana Brawley accusations, and many others. But there’s another potential harm we also have to think about.

Let’s say that we do manage to establish a social norm that a single accusation of “inappropriate sexual behavior” toward a woman is enough to get you fired and drummed out of your industry. It’s the crux of the issue so eloquently explored recently by Claire Berlinski: What would a reasonable and innocent heterosexual man do to protect himself from the economic death penalty?

One thing he might do is avoid being alone with anyone of the opposite sex — not in the office and not even in social situations. You might, in other words, adopt something like the Pence Rule, so recently mocked for its Victorian overtones. (Or worse still, work hard not to hire any women who could become a liability.)

This would obviously be bad for women, who would lose countless opportunities for learning, advancement, friendship, even romance — the human connections that make us human workers superior to robots, for now.

On the radio recently, I pointed out that this might be a logical result of a “one strike and you’re out” policy. The host, aghast, remarked that this was obviously not what we wanted. And of course, that isn’t what anyone wants. It might nonetheless be the logical result of the rules we’re setting up.

It’s easy for me to think of all the things I would have lost out on under a strict Pence Rule. The creative writing professor who conducted my independent study in his house, for example. It was perhaps a more innocent time, but even then I was not unaware of the sexual overtones our culture would see in a young female student going to a much older male professor’s home while his wife was at work. He was a perfect gentleman who made me cabbage soup, taught me to insert little slivers of garlic into a beef roast, and savagely critiqued my prose. David Slavitt, wherever you are, thank you for making me a better writer. And my condolences to all the female students today who will never have similar opportunities — if I may judge by the bemusement/horror of male professors to whom I have told this story.

December 18, 2017

QotD: The perils of well-meaning regulation

Filed under: Economics, Government, Quotations — Tags: , , — Nicholas @ 01:00

Because the rich and powerful run the government, the poor and other powerless have been regularly hurt by governmental regulation – even by such sweet-sounding regulations as evening closing of shops (making it hard for the working poor to have time to shop) or protections limiting the hours women could work (making it hard for them to hold supervisory jobs requiring one to come early and stay late) or building codes claiming to promote safety but instigated by building trade unions (making it hard to build inexpensive housing) or minimum wages (making it hard for blacks, immigrants, women, and nonmembers of craft unions to get paying jobs).

Dierdre McCloskey, Bourgeois Equality, 2016.

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