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Presenter Information

Robert E. Prasch, Middlebury College

Start Date

27-4-2012 3:20 PM

End Date

27-4-2012 3:50 PM

Document Type

Presentation

Description

The starting point and core notion of neoclassical or mainstream economics is a reductionist vision of the exchange of commodities. Missing is the historical, social, and legal environments within which exchanges occur. A parallel and equally problematic notion is that labor exists as something of a “found object.” By contrast, the classical school of economists understood that laborers must earn a wage equal to or greater than “subsistence” if society was to be an ongoing enterprise. Laborers must be fed, sheltered, socialized, and educated before they arrive in the labor market. This, in a phrase, is the Social Cost of Labor. If the society in question is at all “advanced” or “complex” the expenses associated with what was once termed the “civic minimum” will also be greater. These considerations, which were a commonplace of economic discourse and policy-making a hundred years ago, have disappeared from contemporary discussions. This presentation will demonstrate that presupposing a “social cost of labor” substantially modifies both the analytics and ethics of labor economics.

social cost 6.pdf (169 kB)
Transcript - Social Cost - Prasch

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social cost 6.pdf (169 kB)
Transcript - Social Cost - Prasch


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Apr 27th, 3:20 PM Apr 27th, 3:50 PM

The Social Cost of Labor and Its Importance for Labor Economics

The starting point and core notion of neoclassical or mainstream economics is a reductionist vision of the exchange of commodities. Missing is the historical, social, and legal environments within which exchanges occur. A parallel and equally problematic notion is that labor exists as something of a “found object.” By contrast, the classical school of economists understood that laborers must earn a wage equal to or greater than “subsistence” if society was to be an ongoing enterprise. Laborers must be fed, sheltered, socialized, and educated before they arrive in the labor market. This, in a phrase, is the Social Cost of Labor. If the society in question is at all “advanced” or “complex” the expenses associated with what was once termed the “civic minimum” will also be greater. These considerations, which were a commonplace of economic discourse and policy-making a hundred years ago, have disappeared from contemporary discussions. This presentation will demonstrate that presupposing a “social cost of labor” substantially modifies both the analytics and ethics of labor economics.