One common feature of those who proclaim themselves to be aligned with the Austrian School of Economics is the opposition to most forms of government intervention in markets. It follows logically, then, that Austrians are generally opposed to minimum wage legislation. I think I’m beginning to understand why:
Pretty much all economists can agree that people respond to incentives, so it’s worth remembering (in this case and others) that incentives can affect beliefs too.
Update: Justin Wolfers has a less charitable but more amusing analysis of the data:
Also, people, just relax and take a joke. It’s fun, I promise, and maybe even productive if it gets someone to respond to the ad. If you want to see real criticism based on this ad, check out the article that the screen shot originally came from.
23 responses so far ↓
1 jeff // Feb 18, 2013 at 2:52 pm
I know this is just hackish austrian bashing, but it’s quite possible to write a 500 word article in 1 hour and 20 minutes ($10/7.25, NY minimum wage), especially if its a topic you’re comfortable writing about and the required writing quality is low.
2 Brett // Feb 18, 2013 at 2:55 pm
That’s pretty small. I suppose the upside is that they’re at least willing to pay something for the article, even if it’s just $10 per article – and they’re open to anyone who sends in a good enough writing sample. Just make sure that everything appears under your byline.
A lot of places wouldn’t even go that far. They’d say “We won’t pay you, but you’ll get exposure writing these articles for us!” *cough* Huffpost *cough*
3 Bo Zimmerman // Feb 18, 2013 at 2:57 pm
Miss Beggs brings up a fascinating question. Fortunately, it’s a resolvable empirical question, though not simple to disentangle: Do consumers buy value, or does value come about from being bought. Did I hire this guy because he’s an Austrian, or is he an Austrian because I hired this guy?
I seem to recall having seen some data on this question (mostly related to politicians and charities), but if someone can refresh my memory, that would be appreciated.
4 Rev. Pfloyd // Feb 18, 2013 at 2:58 pm
^^Ha, I was *just* about to bring up the Huffpost. Or, being a former musician, the always wonderful music-venue phrase: “We can’t pay you, but you’ll get lots of exposure to a potential audience!”
5 J.D. // Feb 18, 2013 at 3:22 pm
@Jeff:
What’s the average market value of telecommuting to work perks for workers? That should be included in your calculation.
6 J.D. // Feb 18, 2013 at 3:23 pm
Also relevant:
What Austrian Economics IS and What Austrian Economics Is NOT
7 econgirl // Feb 18, 2013 at 3:24 pm
Technically, HuffPo may be onto something from a psychological perspective:
Uri Gneezy and Aldo Rustichini, “Pay Enough or Don’t Pay at All”
http://rady.ucsd.edu/faculty/directory/gneezy/pub/docs/pay-enough.pdf
8 econgirl // Feb 18, 2013 at 3:26 pm
@ J.D.: I chose my words carefully- note that I didn’t specifically say that the Austrian School itself was by definition against minimum wages, just that a lot of people who align with it are against minimum wages.
9 J.D. // Feb 18, 2013 at 4:20 pm
And the video fleshes out your carefully chosen wording nicely by explicitly showing that AE is not a specific set of policy prescriptions.
10 econgirl // Feb 18, 2013 at 4:42 pm
Hm…that seems fair, and now I plan on watching the video.
11 Trent Rock // Feb 18, 2013 at 7:05 pm
Every time I ask an Austrian Schooler “Why is there no inflation, when the money supply has tripled”
They say “Oh there is rampant inflation!! The Govt just lies.Wake up!!! Have you been to the grocery store lately, Trent?”
12 Lucas Engelhardt // Feb 18, 2013 at 10:38 pm
Interesting!
Though it’s only fair to note that academic economists are often paid a negative wage for submitting significantly longer (and far more time-consuming) articles to, say, the AER or JPE – where submissions cost $100+ each, and fewer than 10% of those get published…
13 econgirl // Feb 18, 2013 at 10:51 pm
To be fair, in the case of the professors, they are getting paid by the university so that they don’t have to turn their publications into a direct profit-making endeavor. In that sense, the $100 fees are like really nerdy lotto tickets.
14 Brian Donohue // Feb 21, 2013 at 10:25 am
It is no doubt annoying to work in a profession where a segment continually reminds one that “you don’t know, and I don’t know” when your whole raison d’être relies on convincing your clients (students, companies, governments) that your pretense of knowledge, is you know, actual knowledge and regardless of how much you really know, the questions are gonna keep coming because they are pressing and important questions, even if the answers are largely unknowable. So yeah, I get where you’re coming from here.
15 Michael // Mar 1, 2013 at 1:34 pm
Austrian Economics is bad, and Austrian economists should feel bad.
16 Financial Planner Massachusetts // Mar 13, 2013 at 10:14 am
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17 DM // Mar 26, 2013 at 3:04 pm
Wouldn’t a real Austrian demand to be paid in gold rather than fiat? Maybe it’s a test for respondents?
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