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It also ignores a similar phenomenon among the poor. Decreased self-supply. In a rich country this might mean paying for childcare so you can work. Your expend
by graemep 9mo ago
It also ignores a similar phenomenon among the poor. Decreased self-supply.
In a rich country this might mean paying for childcare so you can work. Your expenditure has gone up, but you are only better off by the increased post tax income less the cost of childcare. Even worse is paid childcare has substituted for family provided (e.g. grandparents) childcare.
In a poor country it might mean buying food instead of growing it. An industrial worker will buy their food, a subsistence farmer will grow their own. There is a huge increase in expenditure, but they might well end up with a worse diet.
This is not new. The initial workforce for the industrialisation of Britain (the first country to industrialise) was available because of the enclosure of common land forced people to seek work in cities.
- palmotea 9mo ago> In a rich country this might mean paying for childcare so you can work. Your expenditure has gone up, but you are only better off by the increased post tax income less the cost of childcare. Even worse is paid childcare has substituted for family provided (e.g. grandparents) childcare. That's a pretty clear illustration of the myopia of excessively quantitative economic thinking. The economist looks at easily-quantified numbers: WAGES - CHILDCARE_EXPENSE = POSITIVE_NUMBER, and concludes "PROFIT! EVERYONE WINS!" But the hard-to-quantify negatives are completely ignored: the poorer relationship between the kids and parents, negative psychological effects on the kids due to day care, etc. That's especially true when talking about things in aggregate.
- graemep 9mo agoI very much agree with you (and that is reflected in my own life choices), but that is a different point. My point is that people are not even as much financially better off as the numbers say.