<p>The question in my mind is: do results matter or intentions matter?</p>
<p>I’ve heard of one story where a charity gave clothing to people somewhere in Africa. Nice right? Well, apparently that destroyed their burgeoning textile industry that would have had a real chance at raising the wealth in the area.</p>
<p>Is the doctor, loved by others, who saves one life a week better or worse than the doctor who is rude to his patients, does it for money, ignores his family, yet saves 20 lives per week?</p>
<p>Matter in regard to what? I generally say only results matter, but I’m generally speaking about policy, it is not a means-justifies-the-ends argument. For example, minimum wage laws raise unemployment, rather than making anybody better off. So I’m in favor of abolishing minimum wage (pick up any econ textbook for a more complete explanation).</p>
<p>But if you asked me if intentions or results matter when, say, a little girl bakes a cake for her mom for her birthday, then I think intentions are what the mom most values.</p>
<p>I would say morals deal with effects… intentions are ethics. If someone kills a lunatic in self defense, the person concerned with morals would say it was immoral (all he sees is appearance, he never cdonsiders the reason the lunatic was klilled, assuming it was not obvious.</p>
<p>I guess you want us to respond in terms of YOUR ethics. After all, who are you to say that working at Walmart for the money is ethically wrong? Essentially, you want us to think for you.</p>
<p>no, I think most people here realize that that is not true.</p>
<p>Example:</p>
<p>there was a reply to my post about soldiers being ethical … I didn’t even attempt to make a counter argument. I don’t think I’ve attacked anyone’s opinion (except yours).</p>
<p>The economic textbooks may be wrong. Do minimum wage laws raise unemployment? If so, then why is there now a raging debate within the economic literature about the effects of minimum wage laws on unemployment rates, with a number of empirical papers in top journals, most notably the Card & Krueger’s 1994 piece in AER, showing that such laws may actually decrease unemployment. Yes, that’s right - a decrease. </p>
<p>Granted, other empirical studies have shown that there may indeed be an increase in unemployment. Nevertheless, what is now clear is that no consensus exists amongst the economics community, and that economics textbooks should no longer be asserting a clear effect of minimum wage laws on unemployment. </p>
<p>To be fair, a consensus amongst economists regarding this issue did exist a few decades ago, which is surely where economics textbooks have based their claim. But those textbooks are now obsolete as empirical tools and the availability of data have advanced considerably over the last generation. </p>
<p>Whatever one’s opinion about the issue, surely nobody can continue to argue with a straight face that a consensus exists within the economics community. A considerable fraction of leading economists now believe that there is no clear relationship between minimum wage laws and rising unemployment.</p>
<p>You mean the thoroughly discredited study that relied on phoning up managers of the fast food companies that had stayed in business after the hike and asking them whether they had more or less employees (instead of hours worked)? A few dodgy studies here and there refuting what every other study in economic history has had to say about the issue hardly “refutes” the very sound economic logic behind the idea that a price floor results in an artificial surplus. The fact that many if not most minimum wage laws are set a little below or a little above the equilibrium point (for the existing supply of labor) helps to hide the resulting increase in surplus labor (i.e. a ten percent hike only resulting in a one percent dip in employment).</p>
<p>The real minimum wage is zero, those whose productivity falls between zero and the minimum wage are made legally unemployable. Ex-cons, the mentally handicapped, minorities from impoverished neighborhoods, people from broken homes, the very young who have no work ethic yet, etc., are the hardest hit by minimum wage laws. The last job I had, a job training program for the mentally ■■■■■■■■, could have been made obsolete by abolishing the minimum wage and making the people in question actually employable, albeit at a low rate to start. But it’s better than languishing in a glorified baby-sitting program for their whole lives.</p>
<p>No, actually, I’m talking about the entire stream of literature that followed on that supported those results. </p>
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<p>Uh, wait, which ‘other studies’ are you talking about? The purely theoretical pieces that never actually had any data at all, and hence can’t actually be called “studies” under any strict definition of the term? It is precisely those theories that may be shown to be “dodgy” and “thoroughly discredited”.</p>
<p>That actually highlights one of the major problems with the way that economics is currently utilized - there are far too many people who pontificate about theories without actually having any empirical data that demonstrates what they are saying. Whatever you may say about the supposedly discredited paper (albeit heavily cited in a top journal) that questions the linkage between minimum wage and employment, it’s still better than the purely theoretical arguments that never presented any data at all. The bulk of the empirical evidence therefore seems to question whether a link between unemployment and minimum wage laws truly exist. </p>
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<p>Is that true? Has that been shown empirically? </p>
<p>Again, to be clear, I am not saying that minimum wage laws don’t generate unemployment. Perhaps they do, perhaps they don’t. The point is that it needs to be demonstrated empirically through a multitude of studies with which we can then examine the totality of evidence. Thankfully, those studies are now forthcoming and so we’ll have to wait for what the evidence says. But we cannot prejudge the answer without collecting any evidence at all. Pure theories - without actual empirical evidence to back them - are not scientific, but rather belong to the realm of metaphysics and philosophy. </p>
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<p>Again, that assumes that every organization that employs labor actually cares solely about productivity, or that such productivity can even be measured at all. How do you measure productivity in, say, academia? Or at an NGO? Or in government? None of them could be said to produce an output that can be easily measured in terms of productivity in the economic sense of thew ord Yet, whether you like it or not, these organizations employ millions of people, and they’re not going to disappear.</p>
<p>A perennial problem I’ve found within economic zealots is that they perpetually harp upon a world that doesn’t exist and never will. We’re never going to live in a world where every decision ever made is to maximize economic output, however “Pareto-efficient” or “welfare-maximizing” such a world supposedly might be. Nor will we ever live in a world characterized by true economic equilibrium. {Name a single real-world market that could be said to actually be in equilibrium.} We have to deal with the world the way that it is, not how some economics-enthralled people might wish it to be.</p>
<p>Sakky, I don’t know that much about economics, but the more empirical-based approach you keep on championing makes a lot of sense to me. Do you know enough about economics research to say whether typically this is how economics research is done, or is it primarily philosophical?</p>
<p>sakky, you discredit yourself. For all your talk about empirical evidence you seem to be ignoring an awful lot of it. I shouldn’t have to do your googling for you, nor should you necessarily hold so much stock in “cutting edge research in the latest journals,” or how often a paper is cited, but rather empirical evidence and reason, which is timeless.</p>
<p>But I googled for you anyway, and now I’m leaving this thread:</p>
<p>Theory is still pretty important; you cannot establish any sort of cause with a theoretical basis. Empirical results only establish correlations. Besides, some theorems one might never expect from just empirical results, like Arrow’s Impossibility Theorem or the Nash Equilibrium, and they are quite applicable. But you are talking about macroeconomics, which is a lot more complex and difficult to study theoretically. Anyway, can you please post some links to the studies you are referring to?</p>