I don't think this is quite right. First of all, I would doubt the relationship would be perfectly linear (e.g. doubling and halving), mainly because putting the second person to work would not have the same effect as the first one being there. Probably the person not working is marginally less productive than the one already in the workforce. But that is really beside the point because I don't think that even if they were identical that this is the way things work. If we assume that the second person really is exactly as productive as the first, what we would end up with is an economy with twice the output (neglecting all niggling details, like childcare, as he is). So assuming a constant money supply, wages would indeed halve as workers underbid each other in price competition, but since output would double, prices would also halve. Materially, at least, the couple would be twice as "well off." (Again, to a first approximation that neglects a lot of important details.) So saying that two incomes would be needed where one would have sufficed is incorrect. Basically, same number of consumers, twice the output. (Once again, throwing the money out with the bathwater makes things easier.) Price competition occurs at both ends, not just on the wage curve. Doubling output will reduce prices at the consumption level in addition to the first effect. More workers competing for same dollars, more goods competing for same dollars. Of course, all those details we threw out are quite important, and I would still have to agree with the overall thrust of the column. In fact, I posted a video awhile back that looks at exactly the effect of women going off to work, and you can see for yourself where all that money/increased production went. The short answer: taxes (e.g. more government largesse), larger mortgages for bigger houses, a second car, and childcare. All this, in exchange for sending mom off to work. Not my idea of a good trade. Mom is worth an awful lot more than that. (Side remark: does this mean that I devalue women by saying so or that I value them highly? You decide...) It may not be so polite to say so, but the key to understanding FS's sentiment is ingratitude. Ask anyone who can remember the days when moms stayed at home, and I'm absolutely certain that they will tell you that families today have lots more material stuff than back then. Only part of that can be attributed to increased per capita productivity. It is perfectly possible to sustain yesteryear's lifestyle on a single income today; in fact, it's probably easier (or at least, has been in the recent past... I expect all that to change shortly). I know families that do so. We just have "higher standards" these days, and short memories. What FS doesn't understand is that today, the average American family actually is materially better off, doesn't appreciate it at all because the money gets wasted on superfluous possessions that are easily discounted and taken for granted, and is spiritually broken. Thanks to the final effect, the first will soon be unraveled, and all will have been lost. Both the American family and American women would have been better off if mom had stayed at home in the first place.1) If women should merely stay at home and take care of the children and do nothing else, how should such a family survive in the days when you need a dual income and the cost of everything is going up?FS doesn't understand that the primary reason a dual income is required is because so many women are working now. This is basic supply and demand. If you double the work force, you halve the price of labor. Two incomes are now needed where one previously sufficed.
Monday, February 9, 2009
Gasp! I Disagree with Vox
I'm a little scared to do so, as Vox has a way of being right an awful lot of the time, and a way of making people who disagree with him look really, really stupid. But I just don't agree with his analysis of women going to work: