Sounds like Larry Summers and Brad De Long are channeling (two channels) John Bates Clark.
Gene Coyle On Jan 11, 2011, at 5:43 PM, michael perelman wrote: > Rakesh mentions John Bates Clark theory. Actually, Clark had two > opposing theories. For policy makers, he taught that trust, cartels > and monopolies were necessary to contain destructive competition. For > workers, competition resulted in just outcomes. > > I go into more details in The Invisible Handcuffs & Railroading Economics. > > On Tue, Jan 11, 2011 at 4:35 PM, Lakshmi Rhone <[email protected]> wrote: >> "We do not really know if a US bus >> driver's wages are higher, in real terms ,i.e., in terms of purchasing power >> (which is what is socially relevant) than the wages of an Indian bus >> driver." >> >> >> Yes we do; it's much higher in $PPP. Tens of times higher. Econ I students >> still learn >> that it's basically true that all factors earn an amount equal to the value >> of what they >> contribute to output." And the wage is supposed to equal the marginal >> revenue product of labor, no? >> >> Ever since Clark this theory has supposed to make market-determined >> distribution seem fair. >> There are a lot of problems with this theory in terms of whether it adds up >> with non-constant returns to scale >> and whether it has empirical support and whether it can be formulated in an >> empirically testable manner. >> >> Leave that all aside. My point is that what gives the theory some practical >> resonance among the American working class >> are not the illusions of competition as Marx theorized but the protection >> afforded workers via restrictive immigration law. >> >> If wages were set in the absence of immigration control, workers would have >> no illusion that their earning reflects the value >> of what they contribute to output. I am not saying that in the absence of >> open borders the American working class is not exploited. >> >> >> >> _______________________________________________ >> pen-l mailing list >> [email protected] >> https://lists.csuchico.edu/mailman/listinfo/pen-l >> >> > > > > -- > Michael Perelman > Economics Department > California State University > Chico, CA > 95929 > > 530 898 5321 > fax 530 898 5901 > http://michaelperelman.wordpress.com > _______________________________________________ > pen-l mailing list > [email protected] > https://lists.csuchico.edu/mailman/listinfo/pen-l _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
