6 ms·

> As a counter example, many places in Asia have gone more pro-market in the last decades and have benefitted enormously from it. I don't think this is necessa

by Jochim 6y ago

> As a counter example, many places in Asia have gone more pro-market in the last decades and have benefitted enormously from it. I don't think this is necessarily a counter example. Certainly some individuals in these countries are much better off than they were before. The economies of these countries may be doing better, but this growth has increasingly come at the expense of a vast number of individuals lower down the pole. The youth of China moved to the city from farming towns and villages, and now work to enrich the CEOs and executives of Foxconn. Children in Bangladesh and India are spending twelve hours a day making shoes for Nike. The well off in these countries are much more well-off than they were before, but the poor are potentially in a worse/more inescapable position than they started. > Singapore is perhaps the closest to a free market place on earth, and is also one of the richest and safest. Singapore is a heavily authoritarian country in which the state directly controls large sectors of the market[1] and daily life. Some quotes from the source that illustrate the extent to which the Singaporean government is directly involved in shaping and controlling the country's markets: > State monopolies provide all utilities, telephone and postal services, port and airport services, industrial estates, and radio and television. Government ministries provide a large part of medical and health services, all sanitation services, and all education for the population from primary to tertiary level. The state Housing and Development Board houses nearly three-quarters of the population in public housing estates. In the non-social sector they own and operate: > Singapore Airlines, ...A state trading company, a state shipping company, two state join-venture shipyards, ...The Development Bank of Singapore The government also owns "about 75% of all land in the country". The rest of the paper goes into detail explaining how the government routinely intervenes with subsidies and tax policy in order to force the market into whatever shape it deems fit. So I think the fact that people view Singapore at anything close to a free market is more a testament to just how effective the propaganda that has been pushing free market economic thought has been. [1] https://sci-hub.se/https://www.jstor.org/stable/2644389?seq=1 https://sci-hub.se/https://www.jstor.org/stable/2644389?seq=...

eru 6y ago
> The well off in these countries are much more well-off than they were before, but the poor are potentially in a worse/more inescapable position than they started. Would you count this statement as falsified, if eg the median income in Bangladesh went up? (Or any other percentile.) If not, what would falsify that statement? Singapore is an interesting case. You are right about ownership. I am basing my estimate more on eg the low rate of government spending compared to total GDP, general ease of doing business, light touch regulation. Close to my heart (coming from Germany) is the absence of pervasive occupational licensing in Singapore. Similarly the absence of minimum wage laws. > The rest of the paper goes into detail explaining how the government routinely intervenes with subsidies and tax policy in order to force the market into whatever shape it deems fit. So I think the fact that people view Singapore at anything close to a free market is more a testament to just how effective the propaganda that has been pushing free market economic thought has been. I am currently living in Singapore, and so far the 'propaganda' has been so effective that even living here I still see that it's fairly pro-market. And that includes talking to 'normal' locals, and also to people running businesses here. Malaysia is useful for contrast. The government is a much bigger drag on the economy there. The paper you quote is fairly old, and also doesn't seem to reflect the consensus of economists. (It's nonetheless interesting though.)
- Jochim 6y ago
  > Would you count this statement as falsified, if eg the median income in Bangladesh went up? (Or any other percentile.) If not, what would falsify that statement? I don't honestly know. Quality of life is in my mind the most important factor and is hard to measure, I don't think there's any one statistic or small group of statistics that can capture it. What worries me at the moment is the trend of 40-50 years of productivity increases leaving wages far behind. The elimination of secure, well paying jobs for the lower working classes that have been replaced with gig/service work where you hope you'll be given enough hours to make end meet that week. Sectors of local economies destroyed or made dependent on global capital firms with huge losses. I want to know where it will end, because all I can see in the future is rising inequality and stratification. > Close to my heart (coming from Germany) is the absence of pervasive occupational licensing in Singapore. Similarly the absence of minimum wage laws. I'm not familiar with occupational licensing in Germany. But I don't have a problem with it if it's done to ensure safety/quality and there are minimal barriers to entry, employers seem all too happy to introduce inexperienced workers to situations which may not be obviously dangerous to the worker without proper training. Minimum wage is a fairly contentious issue, what is it you dislike about it in particular? Interestingly it looks like some sectors have enforced a minimum wage: https://www.minimum-wage.org/international/singapore https://www.minimum-wage.org/international/singapore I'd be interested in knowing why cleaning and security were singled out specifically rather than a more general rule. >I am currently living in Singapore, and so far the 'propaganda' has been so effective that even living here I still see that it's fairly pro-market. >And that includes talking to 'normal' locals, and also to people running businesses here. >Malaysia is useful for contrast. The government is a much bigger drag on the economy there. >The paper you quote is fairly old, and also doesn't seem to reflect the consensus of economists. (It's nonetheless interesting though.) It was interesting to see how far back the disagreement on Singapore's economy goes.
  - eru 6y ago
    > What worries me at the moment is the trend of 40-50 years of productivity increases leaving wages far behind. First, people usually make that claim for the US. Living standards in the developed world have improved too visibly. So let's concentrate on the US. Second, that claim usually comes about by people comparing productivity statistics to wage statistics. Usually, both of those data sets are inflation adjusted, but via different measures of inflation. To avoid that complication, we can just look at the ratio of nominal wages to nominal GDP over time. https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-labor-share.htm https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-... has a graph that shows that labour share falling from about 66% in 1947 to ~58% in 2016. That's a fall to be sure, but calling the change something like 'leaving wages far behind' seems a bit dramatic. If I remember right, most of that lost 8% went to higher land rents. The share of capital is generally stable. I find land rents as problematic as the next Georgist. > I want to know where it will end, because all I can see in the future is rising inequality and stratification. Globally, inequality has gone down massively over the last few decades. Billions of people used to starve. Now people in China and (many in) India obsess over which smart phone to buy. > I'm not familiar with occupational licensing in Germany. But I don't have a problem with it if it's done to ensure safety/quality and there are minimal barriers to entry, employers seem all too happy to introduce inexperienced workers to situations which may not be obviously dangerous to the worker without proper training. In Germany, the government requires a two to three year apprenticeship for you to be allowed to eg cut hair or fix a computer or lay bricks or cook etc. In Singapore, you mostly just have to do a short health and safety training, and then it's up to the customers to reject your bad haircuts. > Minimum wage is a fairly contentious issue, what is it you dislike about it in particular? They are an instance of the 'Copenhagen interpretation of ethics': https://blog.jaibot.com/the-copenhagen-interpretation-of-ethics/ https://blog.jaibot.com/the-copenhagen-interpretation-of-eth... If we want poor people to have more money, we should levy a general tax of some kind, and then use the proceeds to give them more money. Minimum wages put a burden on people who interact with poor people instead. So they encourage you to find ways around having to interact with poor people. Eg you can avoid the burden by eg replacing workers with robots, or by shopping at a more upmarket place than Walmart. Or eating at fancy restaurants instead of Burger King. (You might notice that the people shopping at places that hire a lot of minimum waged workers tend to be also on the poorer side. And I don't think business owners are absorbing the costs of minimum wages, because capital is internationally mobile.) > It was interesting to see how far back the disagreement on Singapore's economy goes. I asked Google Scholar to tell me who cited the paper you quoted to get some further context. The paper and author seem to be embedded in some particular corner of economics. Wikipedia and most of the rest of the world describe Singapore as free market. (Including also the economists blogging at econlog.) > I'd be interested in knowing why cleaning and security were singled out specifically rather than a more general rule. I might look up the history behind that. In general, I assume it was some pragmatic bending to political pressure. In some instances the population is not quite as free market as the government here. I really like the system Singapore has for cars. Basically, the government sets an overall limit for the number of cars on the island. It's about a million at the moment. Those one million permits are auctioned off to the highest bidders for ten years at a time. Each month, roughly 1% of permits expire and are auctioned off again. The auction is a simple affair: The government takes all the bids from the current month, and determines the lowest price that clears the market. Ie every one who bid more than the clearing price gets a permit at the clearing price. Everyone who doesn't get a permit bid less than the clearing price. To come to the point: often people suggest that instead of every winner paying the same price, winners should be made to pay what they bid. For some reason, that's supposed to make big companies pay more in the end, and individuals pay less. Of course, big companies are exactly the kind of institutions who can afford the modelling and research to forecast the clearing price, and they can also afford to miss out or get a few extra cars in their fleet. (Thus the government understands economics a bit better than much of the population.) It's also a good illustration of how the government intervenes here, instead of letting everyone drive a car, but does so in a way that econ 101 would approve of.

by Jochim 6y ago

eru 6y ago

> The well off in these countries are much more well-off than they were before, but the poor are potentially in a worse/more inescapable position than they started. Would you count this statement as falsified, if eg the median income in Bangladesh went up? (Or any other percentile.) If not, what would falsify that statement? Singapore is an interesting case. You are right about ownership. I am basing my estimate more on eg the low rate of government spending compared to total GDP, general ease of doing business, light touch regulation. Close to my heart (coming from Germany) is the absence of pervasive occupational licensing in Singapore. Similarly the absence of minimum wage laws. > The rest of the paper goes into detail explaining how the government routinely intervenes with subsidies and tax policy in order to force the market into whatever shape it deems fit. So I think the fact that people view Singapore at anything close to a free market is more a testament to just how effective the propaganda that has been pushing free market economic thought has been. I am currently living in Singapore, and so far the 'propaganda' has been so effective that even living here I still see that it's fairly pro-market. And that includes talking to 'normal' locals, and also to people running businesses here. Malaysia is useful for contrast. The government is a much bigger drag on the economy there. The paper you quote is fairly old, and also doesn't seem to reflect the consensus of economists. (It's nonetheless interesting though.)

Jochim 6y ago
> Would you count this statement as falsified, if eg the median income in Bangladesh went up? (Or any other percentile.) If not, what would falsify that statement? I don't honestly know. Quality of life is in my mind the most important factor and is hard to measure, I don't think there's any one statistic or small group of statistics that can capture it. What worries me at the moment is the trend of 40-50 years of productivity increases leaving wages far behind. The elimination of secure, well paying jobs for the lower working classes that have been replaced with gig/service work where you hope you'll be given enough hours to make end meet that week. Sectors of local economies destroyed or made dependent on global capital firms with huge losses. I want to know where it will end, because all I can see in the future is rising inequality and stratification. > Close to my heart (coming from Germany) is the absence of pervasive occupational licensing in Singapore. Similarly the absence of minimum wage laws. I'm not familiar with occupational licensing in Germany. But I don't have a problem with it if it's done to ensure safety/quality and there are minimal barriers to entry, employers seem all too happy to introduce inexperienced workers to situations which may not be obviously dangerous to the worker without proper training. Minimum wage is a fairly contentious issue, what is it you dislike about it in particular? Interestingly it looks like some sectors have enforced a minimum wage: https://www.minimum-wage.org/international/singapore https://www.minimum-wage.org/international/singapore I'd be interested in knowing why cleaning and security were singled out specifically rather than a more general rule. >I am currently living in Singapore, and so far the 'propaganda' has been so effective that even living here I still see that it's fairly pro-market. >And that includes talking to 'normal' locals, and also to people running businesses here. >Malaysia is useful for contrast. The government is a much bigger drag on the economy there. >The paper you quote is fairly old, and also doesn't seem to reflect the consensus of economists. (It's nonetheless interesting though.) It was interesting to see how far back the disagreement on Singapore's economy goes.
- eru 6y ago
  > What worries me at the moment is the trend of 40-50 years of productivity increases leaving wages far behind. First, people usually make that claim for the US. Living standards in the developed world have improved too visibly. So let's concentrate on the US. Second, that claim usually comes about by people comparing productivity statistics to wage statistics. Usually, both of those data sets are inflation adjusted, but via different measures of inflation. To avoid that complication, we can just look at the ratio of nominal wages to nominal GDP over time. https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-labor-share.htm https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-... has a graph that shows that labour share falling from about 66% in 1947 to ~58% in 2016. That's a fall to be sure, but calling the change something like 'leaving wages far behind' seems a bit dramatic. If I remember right, most of that lost 8% went to higher land rents. The share of capital is generally stable. I find land rents as problematic as the next Georgist. > I want to know where it will end, because all I can see in the future is rising inequality and stratification. Globally, inequality has gone down massively over the last few decades. Billions of people used to starve. Now people in China and (many in) India obsess over which smart phone to buy. > I'm not familiar with occupational licensing in Germany. But I don't have a problem with it if it's done to ensure safety/quality and there are minimal barriers to entry, employers seem all too happy to introduce inexperienced workers to situations which may not be obviously dangerous to the worker without proper training. In Germany, the government requires a two to three year apprenticeship for you to be allowed to eg cut hair or fix a computer or lay bricks or cook etc. In Singapore, you mostly just have to do a short health and safety training, and then it's up to the customers to reject your bad haircuts. > Minimum wage is a fairly contentious issue, what is it you dislike about it in particular? They are an instance of the 'Copenhagen interpretation of ethics': https://blog.jaibot.com/the-copenhagen-interpretation-of-ethics/ https://blog.jaibot.com/the-copenhagen-interpretation-of-eth... If we want poor people to have more money, we should levy a general tax of some kind, and then use the proceeds to give them more money. Minimum wages put a burden on people who interact with poor people instead. So they encourage you to find ways around having to interact with poor people. Eg you can avoid the burden by eg replacing workers with robots, or by shopping at a more upmarket place than Walmart. Or eating at fancy restaurants instead of Burger King. (You might notice that the people shopping at places that hire a lot of minimum waged workers tend to be also on the poorer side. And I don't think business owners are absorbing the costs of minimum wages, because capital is internationally mobile.) > It was interesting to see how far back the disagreement on Singapore's economy goes. I asked Google Scholar to tell me who cited the paper you quoted to get some further context. The paper and author seem to be embedded in some particular corner of economics. Wikipedia and most of the rest of the world describe Singapore as free market. (Including also the economists blogging at econlog.) > I'd be interested in knowing why cleaning and security were singled out specifically rather than a more general rule. I might look up the history behind that. In general, I assume it was some pragmatic bending to political pressure. In some instances the population is not quite as free market as the government here. I really like the system Singapore has for cars. Basically, the government sets an overall limit for the number of cars on the island. It's about a million at the moment. Those one million permits are auctioned off to the highest bidders for ten years at a time. Each month, roughly 1% of permits expire and are auctioned off again. The auction is a simple affair: The government takes all the bids from the current month, and determines the lowest price that clears the market. Ie every one who bid more than the clearing price gets a permit at the clearing price. Everyone who doesn't get a permit bid less than the clearing price. To come to the point: often people suggest that instead of every winner paying the same price, winners should be made to pay what they bid. For some reason, that's supposed to make big companies pay more in the end, and individuals pay less. Of course, big companies are exactly the kind of institutions who can afford the modelling and research to forecast the clearing price, and they can also afford to miss out or get a few extra cars in their fleet. (Thus the government understands economics a bit better than much of the population.) It's also a good illustration of how the government intervenes here, instead of letting everyone drive a car, but does so in a way that econ 101 would approve of.