women, immigrants, and labor quality

[Michael Yates]

The circular reasoning of neoclassical economics is remarkable.  If, for
example, we see that education and income are positively correlated,
then given the apriori logical deduction that the wage rate equals the
marginal product of labor (said deduction deriving from the assumption
of short-run firm profit maximization), it must be the case that more
educated workers are more productive, hence their higher wage rate. 
Talk about a perversion of the scientific method!  It's amusing to watch
neoclassicals squirm when empirically minded econometricians show that
the predictions of neoclassical labor economics don't hold up to well to
the facts.

michael yates

Doug Henwood wrote:
> 
> Rakesh Bhandari wrote:
> 
> >I don't get it: if tight labor market =>then faster growth of c in relation
> >to v, i.e., adoption of labor saving technique=>then industrial reserve
> >army of labor grows anew, leading to downward pressure on the real wage,
> >i.e., a loose labor market. How does Gordon expect to preserve a tight
> >labor market if its main effect is the assimilation of labor saving
> >equipment?  Is he confused?
> 
> Well he is writing about historical change. He didn't say anything
> about the desirability or durability of a tight labor market.
> 
> He did clarify for me the reason why the heavy entry of women into
> the paid workforce in the 1970s and 1980s was considered a decline in
> quality (and this was official statistical policy, not his original
> idea). If the wage equals the marginal product, and if women's wages
> were on average 60% of men's, then we can conclude that they're that
> much less productive than men! QED!!
> 
> Doug