martes, junio 03, 2008

Sweatshops create welfare

Many times in class with my students we engaged in theoretical microeconomic analysis like the situation of workers that face tough job conditions. I usually challenged them with a statement I once heard from a very pious relative: "If I can't pay a decent salary, I'd rather not hire at all". My usual answer: "So you'd rather let them starve". This was usually enough to ignite a beautiful class, with many of the students that had been quite the whole term actually engaging in it. But I always missed some evidence to support my claim and here is a beautiful and brief document giving it! (Thanks to Don Boudreaux).

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