Henry Farrell vs. Matthew Yglesias
Jim Henley: The Only Wealth Inequality That Enrages Modern Really-Existing American Libertarians Is Between Those Who Have Little and Those Who Have Even Less…

Parallel Universe Blogging: This Morning in Sleet



But if you're debating the question of whether it should be illegal to require workers to self-extract their left kidney with a razor blade in the bathtub and hand it to their employer to sell into the transplant market before they get to start work, it doesn't get anywhere to point to the fact that some people are better off in general than others.

Maybe there are two companies in town running roughly similar businesses that require the use of some unskilled labor. Both firms are concerned about the problem of employee theft, and both firms are also interested in paying their workers as little as possible. At one firm, they're offering the federal minimum wage of $7.25 an hour, and they're losing some product. At another firm, they're offering $8.25 an hour and requiring kidney self-extraction. Sometimes people get so fed up with having to self-extract their kidneys that they quit and go across town to the lower-paid, less pleasant job. Other times people get fed up with trying to make ends meet on a minimum wage job, so they quit and go across town and extract and surrender their kidneys in exchange for more money.

Sad stories all around, but telling the higher-paying firm that its business model is illegal and it has to switch to the lower-paying one isn't going to make the stories any less sad.

There are, of course, two issues:

  1. Does forbidding workers to choose an option they do choose and making no other changes make workers better off? No.

  2. Does strengthening workers' bargaining power by requiring that all employers meet minimum standards of decent treatment--by forbidding employers from requiring/workers from offering their kidneys up on a platter and limiting the sphere of potential commodities up for sale in certain ways make workers better off? Certainly yes.