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The productivity zombie

October 3rd, 2013

Following on from my previous post on productivity and the eponymous Commission, I have a piece in the Guardian with the stated objective of killing the productivity/micro reform zombie once and for all. Of course, that’s impossible: as watchers of the genre know, there are always more zombies, then sequels and new seasons, then reruns. But I’ll keep on trying.

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  1. Ikonoclast
    October 4th, 2013 at 07:59 | #1

    What really has to be killed is the efficiency myth. This is the myth that economic efficiency, narrowly defined, ought to be the highest value of our society. This efficiency myth is the zombie spawner. Any number of zombie ideas can be and are spawned from the efficiency myth.

    Economic efficiency arguments ignore the human element and the environmental element and subsume all other values to economic values. Really of course it is about taking rights, income and quality of life off workers and giving all the proceeds or as much as possible to the capitalists and rentiers.

    Whenever confronted by an efficency argument I ask this. Efficient for whom? Mostly, the capitalists and rentiers are looking for ever more efficient ways of stripping workers of rights and income and ever more efficient ways of stripping and despoiling the environment. The end result will be a wrecked society and a wrecked environment.

  2. Hermit
    October 4th, 2013 at 09:20 | #2

    I agree there are a lot more hidden traps and omissions in measuring productivity. An economy wide metric might be GDP/hours worked. That takes no account of resource bonanzas or unpaid overtime at the expense of those wanting more hours. While this is going on in the background unnoticed may be huge cost savings. Example Meals on Wheels volunteers who work for $0 an hour, not $20 or whatever.

    As to micro-economic reform generally google an article by former SA electricity boss Bruce Dinham. He says that the ‘reformed’ electricity market is rigged to guarantee generous profits to unnecessary middle men. According to the micro reformers the end customers were supposed to pay less not more.

    Perhaps we need a Dodgy Theories Commission. Part of their brief would be to check on the Productivity Commission.

  3. Socrates
    October 4th, 2013 at 10:55 | #3

    The Productivity Commission has admitted it cannot define productivity, and therefore, presumably it cannot define how it can improve it either. Yet the PC still has a cost. If then the Productivity Commission does not improve productivity, yet has a cost, productivity would be improved by abolishing the Productivity Commission. Then we would have the same result in this area of economic management (zero) and lower costs.

    I look forward to the Productivity Commission’s announcement of its own voluntary disbandment. It is the only way they will stay credible.

    We might do a more general study on the economics of economists, and test for correlations between the number of economists per capita and the rate of economic growth. Then we could see the optimum number of economists we need. We could compare it to the number of astrologers (and other forecasting professionals) per capita to form a baseline. Should we train more astrologers or economists? Hard to say.

  4. may
    October 4th, 2013 at 12:53 | #4

    is this a bit like getting some-one to define socialism?

    the closest i can get is when the essential infrastructure funded from the public purse is run at best value for money,properly maintained and closed to profit takers.

    simple minded. sigh.

  5. Jim Rose
    October 4th, 2013 at 16:38 | #5

    Ikonoclast :
    What really has to be killed is the efficiency myth. This is the myth that economic efficiency, narrowly defined, ought to be the highest value of our society. This efficiency myth is the zombie spawner. Any number of zombie ideas can be and are spawned from the efficiency myth.
    Economic efficiency arguments ignore the human element and the environmental element and subsume all other values to economic values. Really of course it is about taking rights, income and quality of life off workers and giving all the proceeds or as much as possible to the capitalists and rentiers.
    Whenever confronted by an efficency argument I ask this. Efficient for whom? Mostly, the capitalists and rentiers are looking for ever more efficient ways of stripping workers of rights and income and ever more efficient ways of stripping and despoiling the environment. The end result will be a wrecked society and a wrecked environment.

    David Friedman defends the efficienct criterion thus:

    As an economist, I have no expertise in good and bad. I can, however, set up a “criterion of goodness” called efficiency, that has the following characteristics.

    First, it has a fairly close resemblance to what I suspect you mean by “good.”

    Second, it is so designed that in many cases I can figure out, by economics, whether some particular proposal (such as a tariff) is an improvement in terms of my criterion.

    Third, I cannot think of any alternative criterion closer to what I suspect you mean that also has the second characteristic.

  6. J-D
    October 8th, 2013 at 08:53 | #6

    @Jim Rose
    I ask David Friedman for a paintbrush.

    David Friedman hands me a screwdriver and assures me that:
    A. David Friedman thinks a screwdriver is approximately like a paintbrush;
    B. David Friedman knows how to measure the quality of screwdrivers and whether changes in design will improve it or not;
    C. David Friedman can’t think of anything that is more like a paintbrush than a screwdriver is and that also has a quality measurable by David Friedman.

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