jeffrey fisher wrote:
> so, the common sense conclusion here is that there is a causal
> relationship between the low
> wage growth and the high profit growth, ie, that profit growth is so
> robust precisely because
> wage growth has been suppressed. right?
>
> can one actually make that case? or do we think there's something else
> going on?
Even if there is a causal relationship, which I don't know that there is, a better question might be what good is profit growth for the rest of us if it isn't re-invested? In other words, the only socially coherent reason for accepting this argument is that profits are ploughed back into the economy to create more jobs (that's the way Adam Smith justifies it) but it seems pretty indefensible if it isn't being used "productively."
Along these lines, I have a question for Doug (and anyone else who knows). Last night I walked into a thicket of neo-liberal economic theories in my class regarding globalization and productivity. I don't teach an economics class; it's supposed to be about globalization and culture. Still, several of my students attend an economics seminar before my class taught by one of the libertarian guys at GMU (actually most of them are libertarian; that's pretty much their only gig) so ineveitably we get on the subject of how one metric or another makes outsourcing and sweatshops rational, moral, and unstoppable. (It's probably the wrong argument to have but that's another story).
So we started talking about outsourcing in relation to productivity. I couldn't juggle the arguments fast enough, but the argument these students presented was that American workers were more productive than any workers in any other country in the world. Leave aside the way this could possibly justify outsourcing and de-industiralization (basically it is because they are so productive that their labor shouldn't be wasted on menial tasks).
Not being all that well acquainted with these measurements, my first reaction was that this was obviously an ideological argument. One of the students even made a neo-Weberian argument about US (protestant) work ethic and our capitalist institutions. My next, and supporting reaction, was to remember Doug's discussion (nay dissection) of productivity numbers in ch. 2 of After the New Economy. I actually only remembered if vaguely since I read it over the summer and certainly couldn't cite it off the top of my head. But my sense was that these numbers were hardly infalliable and that productivity arguments have been wildly overdrawn. Nevertheless, I hedged on saying that the American worker wasn't the most productive worker in the world and I told the students I would double check this.
Now that I have gone back and looked at that section of the book, I see that most of the discussion is of the arguments about the productivity miracle of the 1990s--which are very good to return to since part of what we were talking about was the concept of the "post-industrial" society. But there are no numbers in that chapter for international productivity per se (or maybe I'm reading it wrong). I don't know if such numbers exist (my students insist that their other econ prof says that they do so...) but, after reading this section of the book again, I wonder just how reliable they are. If US measurements are so convoluted I can't imagine that every other country doesn't have a similar set of wierd cultural survivals biasing whatever set of measurements they offer so that direct comparison would be difficult to make.
I put this in this context so that it might be more obvious if I'm asking the wrong question here, but, in short, are there numbers that say the US worker is the most productive in the world (or not) and how reliable are these comparisons and, if there are, is there a link or set of links I can send them to or a reading I could get for them that discusses this? Moreover, any info on what that actually means in a global context would be good, i.e. what would be the advantage or disadvantage? would there be any way to use this argument as a defense of outsourcing of industrial production (particularly when most of the productivity increase, according to the book, was in the industrial sector)? I feel pretty confident this wouldn't make much sense, but I also don't want to tell them something untrue. I know that is a lot to ask, but thanks in advance for any help.
best, s