{"id":181445,"date":"2016-06-24T17:39:00","date_gmt":"2016-06-24T22:39:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2016\/06\/24\/good-point-12\/"},"modified":"2016-06-24T17:39:00","modified_gmt":"2016-06-24T22:39:00","slug":"good-point-12","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2016\/06\/24\/good-point-12\/","title":{"rendered":"Good Point"},"content":{"rendered":"<p>Over at <i>Angry Bear<\/i>, Sandwichman makes a good point:  For all the claims that &#8220;workplace flexibility&#8221; increases employment, <a href=\"http:\/\/angrybearblog.com\/2016\/06\/the-iatrogenic-and-incoherent-theory-of-flexibility.html\">the societies with the fewest worker protections have the lowest workforce participation rates<\/a>:<\/p>\n<blockquote><p><span style=\"color: blue;\">In its report on \u201c<a href=\"https:\/\/www.whitehouse.gov\/sites\/default\/files\/page\/files\/20160620_cea_primeage_male_lfp.pdf\">The long-term decline in prime-age male labor force participation<\/a>,\u201d President Obama\u2019s Council of Economic Advisers writes:<\/span><\/p>\n<blockquote><p><span style=\"color: blue;\">Conventional economic theory posits that more \u2018flexible\u2019  labor markets\u2014where it is easier to hire and fire workers\u2014facilitate  matches between employers and individuals who want to work. Yet despite  having among the most flexible labor markets in the OECD\u2014with low levels  of labor market regulation and employment protections, a low minimum  cost of labor, and low rates of collective bargaining coverage\u2014the  United States has one of the lowest prime-age male labor force  participation rates of OECD member countries.<\/span><\/p><\/blockquote>\n<p><span style=\"color: blue;\">Although it has&nbsp;indeed become&nbsp;<i>conventional<\/i>, the \u2018flexible\u2019  labor markets mantra is not a theory. It is dogma. An article of faith.  The theory behind the nostrum of flexible labor markets is Milton  Friedman\u2019s natural rate theory of unemployment, which, as Jamie  Galbraith pointed out twenty years ago, was constructed by adding  expectations to the empirical Philips Curve observation of a  relationship between unemployment and inflation:<\/span><\/p>\n<blockquote><p><span style=\"color: blue;\">The Phillips curve had always been a purely empirical relation, patched into IS-LM Keynesianism to relieve that model\u2019s lack of a theory of inflation. Friedman supplied no theory for a short-run Phillips curve, yet he affirmed that such a relation would \u201calways\u201d exist. And Friedman\u2019s argument depends on it. If the Phillips relation fails empirically\u2014 that is, if levels of unemployment do not in fact predict the rate of inflation in the short run\u2014then the construct of the natural rate of unemployment also loses meaning.<\/span><\/p><\/blockquote>\n<\/blockquote>\n<p>Obama and his evil minions<sup>\u00ae<\/sup> should not be surprised by this.<\/p>\n<p>Endorsing general crappiness to the working man has never increased labor force participation rates, because, absent a hyper-Dickensian society, people then opt out of the workforce if they can.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Over at Angry Bear, Sandwichman makes a good point: For all the claims that &#8220;workplace flexibility&#8221; increases employment, the societies with the fewest worker protections have the lowest workforce participation rates: In its report on \u201cThe long-term decline in prime-age male labor force participation,\u201d President Obama\u2019s Council of Economic Advisers writes: Conventional economic theory posits &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[973,975,1003,982],"tags":[],"class_list":["post-181445","post","type-post","status-publish","format-standard","hentry","category-economy","category-employment","category-philosophy","category-stupid"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/181445"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=181445"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/181445\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=181445"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=181445"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=181445"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}