Good post, Brad, especially about England and France. Do you have a reference to Card & Krueger's take on compensating wage differentials? Peter Brad De Long wrote: > > > > > >Tom Walker wrote: > > > >Case in point: I've asked the question three times "how does one > >'adjust appropriately' for the disutility of work?" > > > > I don't know. I do have two observations. > > First, output per worker--as measured by national income > accountants--in the U.S. south fell by about a quarter after the > Civil War. But by *any* social welfare function (save the one that > gave the overwhelming weight to ex-slaveholders utility that was > implicitly maximized by the pre-Civil War market economy) the > post-Civil War U.S. was better off. Freedmen preferred being their > own bosses--sharecropping--to being regimented (and lashed) gang > laborers. Freedwomen withdrew from the... I can't call it the > "paid"... labor force to focus on household production tasks. The > fall in material output per capita was associated with an increase in > human happiness because the disutility of work was lower. > > Second, the old comparison of France and England: England where > peasants lost rights to land early and had no early incentive to > restrict fertility, and thus saw a rapidly-growing rural population > that was pushed out of the countryside into the cities where it > became the reserve army for the textile factories of the industrial > revolution. Manchester 1844. France where peasants acquired rights to > land and found themselves with a substantial incentive to restrict > fertility, and thus saw a slowly-growing rural population that had to > be pulled out of the countryside by the promise of relatively high > urban wages. > > England wins the race as far as national product per capita, indices > of industrialization, and industry-driven military power are > concerned. France seems to me to win the nineteenth-century race as > far as being a more pleasant place to live. Once again, lower > material output per capita is associated with greater human happiness > because the disutility of work was lower. > > Econometric attempts to estimate disutility of work today (and in the > past) have, however, been largely unsuccessful. As David Card and > Alan Krueger explain it, you just cannot find people who are choosing > between less-pleasant and more-pleasant jobs and demanding a wage > premium for the first in order to identify your coefficients. > Instead, all your statistical procedures discover is--now > surprise--that poor people with few options and little formal > education get jobs that are (i) low paid and (ii) hard (and often > unpleasant) work. > > Brad DeLong
