Work and Welfare: The Social Costs of Labor in the History of Economic Thought

Work and Welfare: The Social Costs of Labor in the History of Economic Thought

Work and Welfare: The Social Costs of Labor in the History of Economic Thought

Work and Welfare: The Social Costs of Labor in the History of Economic Thought

Synopsis

This interesting work presents a unique perspective on the history of economic thought by showing that classical economists from Adam Smith to Alfred Marshall had sympathy for workers - for example, the theory of the subsistence wage echoed the theological call for a just wage that existed in the middle ages. It also describes how these thinkers promoted either a set of social obligations or a form of social insurance to assist workers. These economic thinkers of the past argued that a subsistence standard of living was important to maintain and improve workers' efficiency and to raise healthy families. The notion that these writers had an undeveloped theory of social costs that they applied to labor should appeal to economists and others concerned with the plight of workers as the modern economy restructures itself.

Excerpt

The title of this book, Work and Welfare, was contrived from a merger of the titles of two earlier works, A. C. Pigou Wealth and Welfare (1912) and J. A. Hobson's Work and Wealth (1914). Written at a time when economists retained an interest in the conditions of work as experienced by workers, both books had as their objective the setting forth of standards of value in the measurement of human welfare that included an accounting of the relationships among production, consumption and the well being of workers. the key issue, as Hobson put it, was "that conditions of labor and conditions of living, taken severally and in the aggregate, interact in ways that affect the efficiency and well-being of the people" (p. 1). This book is a history of that issue as expressed in the writings of economic thinkers.

My objective in writing this book should be explained. in an earlier book, Activist Unionism: the Institutional, Economics of Solomon Barkin (1993), I had written an account of the social costs of labor as analyzed by J. M. Clark. the emphasis on cost shifting in Clark's analysis seemed to bear a distinct relationship to Pigou's notion of externality, as applied to labor. I wondered whether Pigou had applied externalities to labor, and a quick reading of his work revealed evidence that he had, but not in as sweeping a way as Clark. Study of Pigou led me back to Marshall, who led me to J. S. Mill, which extended the search to David Ricardo, Thomas Robert Malthus Jeremy Bentham and Adam Smith. All of them took a keen interest in the well-being of labor. I decided to produce a history of this interest.

In producing that history I was convinced by several critical reviewers of 3 journal submissions of articles on Pigou and Clark that the social costs approach was too confining, and the help these reviewers gave me is hereby acknowledged. the topic thus expanded into the well-being of labor, with . . .

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