Since April Wu and Alice Munnell of Boston College were prominently cited in
the Sedensky article, and I got my degree from the same institution, I wrote
this letter to the chair of the econ department at BC, with a copy to Professor
Munnell. (Wu is not listed as in the Econ department.)
January 3, 2014
Professor Donald Cox, Chair Department of Economics
Boston College
140 Commonwealth Avenue
Chestnut Hill, MA 02467-3806
Dear Professor Cox,
I received my Ph.D. from BC in 1969. Today I was embarrassed to see
quotes in the Sacramento paper with BC economists said to be fighting the “lump
of labor theory.”
The article I saw was an AP wire story which you can find here:
http://www.sacbee.com/2014/01/03/6044167/will-surge-of-older-workers-take.html
I wonder if someone in the department has undertaken to correct them?
Presumably someone with a focus on macro, on labor/employment or income
distribution policy would be interested in getting this
straightened out. It is certainly important for national policy discussion to
eliminate the error that Professors Munnell and Wu are propagating.
Are Professors Munnell and Wu claiming that technology doesn’t
eliminate jobs? Or do they rely on Say’s Law to comfort all with the idea that
more jobs will appear in response to ... well, something?
Professor Jonathan Gruber over at MIT is also cited in the article.
I’m not familiar with his work but his MIT colleague, David Autor is a great
proponent of the idea that Say’s Law will see to it that more jobs
will appear. Here is his cite of that theory:
“Leading economists from Paul Samuelson to Paul Krugman have labored to
allay the fear that technological advances may reduce overall employment,
causing mass unemployment as workers are displaced by machines. This ‘lump
of labor fallacy’—positing that there is a fixed amount of work to be done so
that increased labor productivity reduces employment —is intuitively
appealing and demonstrably false. Technological improvements create new
products and services, shifting workers from older to newer activities. Higher
productivity raises incomes, increasing demand for labor throughout the
economy. Hence, in the long run technological progress affects the composition
of jobs not the number of jobs.” (A white paper prepared with Lawrence Katz
of Harvard for the National Science Foundation, dated September 29, 2010.)
You will apprehend that Autor is simply relying on Say’s Law, with all
its baggage, to reach a false conclusion. Surely this sort of thing is not
being taught at BC?
Gene Coyle
On Jan 3, 2014, at 3:19 PM, Tom Walker wrote:
> "We all cannot believe that we have been fighting this theory for more than
> 150 years," said April Yanyuan Wu, a research economist at the Center for
> Retirement Research at Boston College, who co-authored a paper last year on
> the subject.
>
> I've forwarded to Sedensky my correspondence with April Wu from Sept. 2012
> that I will paste below. Makes me wonder if "Wu" is short for "Woo-woo." I
> wrote to Gruber in March of 2012 advising him that one of the chapters in a
> book he co-edited had plagiarized from my work and never received a reply.
> What a bunch of bottom-feeders!
>
> On Tue, Sep 18, 2012 at 4:34 PM, Tom Walker wrote
>
> Dear Alicia and April,
> Having done extensive research on the lump-of-labor fallacy claim and
> published three papers on it, I would have hoped that propagation of the myth
> would have died out. But no. Finding no evidence that there is not a fixed
> amount of work is about as challenging as finding no evidence that the sun
> rises in the West. However, it misses two key elements of the issue. First,
> who ever claimed that the sun rises in the West? And second -- as you no
> doubt are aware -- the sun doesn't actually "rise" (even in the East) -- it's
> the rotation of the earth that from a vantage point on earth creates an
> appearance of rising.
> The summary of your paper by the Pew Economic Mobility Project refers to a
> host of increases in Boomer employment being "associated with" increases in
> youth employment or hourly wages. I was taught the expression "correlation
> doesn't imply causation" and there is nothing in that summary that would lead
> me to believe you put forward any more sophisticated causal explanation in
> your paper. I would be interested in reading the paper to see if that is
> indeed the case. In exchange, I would be happy to share with you my published
> research papers on the 232-year old lump-of-labor fallacy canard.
> Cheers,
> Tom Walker
>
> On 19/09/2012 1:14 PM, April Wu wrote:
>
> HI, Tom,
>
> Thanks very much for your email and I am glad to hear that our results are
> consistent with those of your work.
>
> The short brief published by the Pew only reflects a small fraction of our
> work. In the paper, we do explore the causal relationship by using the
> instrumental variable approach. I have attached our working paper for your
> reference.
>
> Feel free to let us know if you have any questions.
>
> Best,
>
> April
>
> On 19/09/2012 4:08 PM, Tom Walker wrote:
>
> Hi April,
> Thanks for your reply. I guess I was entirely too subtle in my criticisms.
> What I'm trying to say is that this "lump-of-labor fallacy" business is a
> red-herring and a distraction from the real policy issues. You say in your
> paper that "opponents of free trade, technological advance and immigration
> often use the lump of labor argument to make people fearful about losing
> their jobs." There are three things wrong with that statement. First, if such
> "opponents" "often use" the argument where are your citations of these
> "opponents" using the argument? Second, you characterize trade and technology
> in blatantly ideological terms that mask the special interests that benefit
> from particular trade and technology policies. Not all trade agreements are
> "free" nor are all uses of technology "advances." Third, you imply that
> people would not be fearful about losing their jobs were it not for these
> nefarious "opponents."
> Your empirical results are unsurprising. You are shooting fish in a barrel.
> But the question is why would you be shooting THOSE fish in THAT barrel?
> There are important policy questions having to do with youth unemployment and
> old-age pensions that have nothing whatsoever to do with imaginary lumps of
> labor. Instead of addressing those issues you set up and knock down a straw
> man. Why?
> I'm attaching a conference paper I wrote last year on the ethical dimension
> of this lump-of-labor canard. I'm also attaching my 2007 article from the
> Review of Social Economy. It is interesting that you cite Schloss and Mayhew
> in your paper. I believe that my earlier article (2000) was a pioneer in
> bringing those sources to light. I have recently come across a parallel
> discussion in the field of Anthropology about what George Foster termed the
> "Image of Limited Good" in a 1965 article. Unlike the groupthink that
> prevails in Economics, Anthropologists found quite a bit to criticize in
> Foster's theory. I suppose I can use your paper as an "object lesson" for my
> next critical survey that will seek to carry over the Anthropological
> critique into Economics.
> Cheers,
> Tom
>
>
>
> On Fri, Jan 3, 2014 at 1:54 PM, Eugene Coyle <[email protected]> wrote:
> There is _always_ a job for a journalist who will trot out this story and
> interview economists who understand nothing. Tom Walker can correct him on
> his date of 1851 but this journalist refuses to be corrected on what he and
> most economists know. Galbraith tried and failed.
>
> Will surge of older workers take jobs from young?
> By MATT SEDENSKY
> Associated Press
> Published: Friday, Jan. 3, 2014 - 9:09 am
> Last Modified: Friday, Jan. 3, 2014 - 1:29 pm
> CHICAGO -- It's an assertion that has been accepted as fact by droves of the
> unemployed: Older people remaining on the job later in life are stealing jobs
> from young people.
>
> One problem, many economists say: It isn't supported by a wisp of fact.
>
> "We all cannot believe that we have been fighting this theory for more than
> 150 years," said April Yanyuan Wu, a research economist at the Center for
> Retirement Research at Boston College, who co-authored a paper last year on
> the subject.
>
>
>
>
>
> Why are economists always so burdened with denying this, as they have been
> denying it forever?
>
> > The theory Wu and other economists are fighting is known as "lump of
> > labor," and it has maintained traction in the U.S., particularly in a
> > climate of high unemployment. The theory dates to 1851 and says if a group
> > enters the labor market — or in this case, remains in it beyond their
> > normal retirement date — others will be unable to gain employment or will
> > have their hours cut.
> >
> > It's a line of thinking that has been used in the U.S. immigration debate
> > and in Europe to validate early retirement programs, and it relies on a
> > simple premise: That there are a fixed number of jobs available. In fact,
> > most economists dispute this. When women entered the workforce, there
> > weren't fewer jobs for men. The economy simply expanded.
> >
> >
> > Read more here:
> > http://www.sacbee.com/2014/01/03/6044167/will-surge-of-older-workers-take.html#storylink=cpy
>
>
> Galbraith refutes them.
>
> > Still, many remain unconvinced.
> >
> > James Galbraith, a professor of government at the University of Texas at
> > Austin, has advocated for a temporary lowering of the age to qualify for
> > Social Security and Medicare to allow older workers who don't want to
> > remain on the job a way to exit and to spur openings for younger workers.
> >
> > He doesn't buy the comparison of older workers to women entering the
> > workforce and says others' arguments on older workers expanding the economy
> > don't make sense when there are so many unemployed people. If there was a
> > surplus of jobs, he said, there would be no problem with people working
> > longer. But there isn't.
> >
> > "I can't imagine how you could refute that. The older worker retires, the
> > employer looks around and hires another worker," he said. "It's like
> > refuting elementary arithmetic."
> >
> >
> >
>
> but the journalist persists, and finds
> Jonathan Gruber, an economist at the Massachusetts Institute of Technology
> who edited a book on the subject for the National Bureau of Economic
> Research, said it's a frustrating reality of his profession: That those
> things he knows as facts are disputed by the populace.
>
> Economists are so firm in denial of jobs being hard to find because to admit
> otherwise is to concede the market isn't working to always keep workers fully
> employed. The market not working, you say? Impossible.
>
>
> _______________________________________________
> pen-l mailing list
> [email protected]
> https://lists.csuchico.edu/mailman/listinfo/pen-l
>
>
>
> --
> Cheers,
>
> Tom Walker (Sandwichman)
> _______________________________________________
> 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
