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Sometimes I think westerners just can't wrap their heads around just how poor Bangladesh is. Their GDP per capita: $2000, adjusted for living costs (PPP). Plea
by jvm 13y ago
Sometimes I think westerners just can't wrap their heads around just how poor Bangladesh is.
Their GDP per capita: $2000, adjusted for living costs (PPP). Please, everyone, try to wrap your head around that number.
That means a totally equal distribution of resources would give everyone $2000 a year. GDP counts all money spent on everything, so factory safety compliance costs would come out of that $2000. Consider Mexican migrant workers in the states scraping by on $10k are earning 5x as much as that number, and no, it is not made up for by cost of living, this is taking that into account.
Yeah the stuff that goes on is really messed up. And no, nobody deserves to live like that. But unlike in America, where GDP is at $50k/capita PPP, redistribution actually cannot solve the problem. $2k/year is unacceptably close to subsistence. It's just as important in this case to grow the economy larger as it is to redistribute more fairly.
- dragonwriter 13y agoYour argument assumes that distribution of wealth has no effect on economic growth -- e.g., that distribution changes are zero-sum not only over the immediate term but over the long term as well. I'd expect the propensity to spend money within the domestic economy to be higher at the lower end of the distribution and lower and the higher end, so I'd expect downward redistribution to, ceteris paribus, increase the domestic velocity of money and expand GDP.
- tptacek 13y agoYou might be taking his point too literally. Another way to look at it is, if the owners of factories in Bangladesh were maximally generous and civic-minded, how much could they improve the lives of garment workers? Is the answer "not very much"?
- lemmsjid 13y agoJust taking the details from the original article, the answer is probably 'quite a bit', and probably without a massive economic impact: * Windows * Air conditioning * Chairs (!!) * Fewer hours and more breaks * Disability and health benefits That's a baseline of civilized-ness. In fact, the act of purchasing the labor to install those things would also stimulate the economy. The real answer to why the above don't exist is not economics, it's, "Because we don't have to do that." And worse (and this is on the conscience of 'first world' peoples), "Because it will marginally increase the cost of the goods, thus causing corporations to purchase from other countries without such protections."
- lostlogin 13y agoI'd argue that heath care for all is a baseline requirement for governments, not businesses. If you run heath care as a business... things happen. However I do agree that in the absence of government action, your solutions are best.
- iliis 13y ago> Because it will marginally increase the cost of the goods And this is not even a given. Even in blue-collar industries it can be quite profitable to improve working conditions and thereby raising employee productivity.
- PeterisP 13y agoYour examples such as * Fewer hours and more breaks * Disability and health benefits are definitely major issues with a massive economic impact. Unless 'fewer hours' is forced on all your competitors as well by effective labor legislation, anyone offering hour less for the same pay would quickly go out of business while the exploiters would grow - the effect of anything an employer can decide wouldn't cause any change to 'marginal cost of goods' - the price would stay the same as determined by the majority of competitors, and only loss would be to that owner.
- alive-or-not 13y agoMeasuring economic potential in PPP is like measuring software functionality in lines of code. The basic question is does a country produce enough food to feed itself. If that's the case it can grow an industry slowly with respect to human lives, etc. If not IMHO there are still better solutions than building sweatshops.
- alexeisadeski3 13y agoDid New York State grow enough food to feed itself during its' own sweatshop phase?
- PeterisP 13y agoMost countries don't wish to grow an industry "slowly with respect to human lives" even if they have enough food to feed themselves. As it shows in practice all over the world, if people are given the chance to go from subsistence agriculture to sweatshops, they do so eagerly, intentionally migrating a thousand miles away from their families if needed so. You'd need to apply a lot of force and bloodshed to move them back away from those jobs to the farming; and when given a fair vote, those workers press for many things but not on slowing down industry growth, rather the opposite.