Should Child Labor Be Illegal in Poor Countries?

I know it's been Steven Landsburg hour around here lately, but I want to share an idea from his book "More Sex Is Safer Sex: The Unconventional Wisdom of Economics" (not my first choice for a book title, I'll admit).

Landsburg argues that rich nations aren't helping the extremely poor in third-world countries by limiting their choices, such as forbidding them to put their children to work:

Being poor means making hard choices, such as whether to work more or to eat less. Neither alternative is terribly palatable, but it requires more than a bit of hubris to suggest that middle-class American and European demonstrators can choose more wisely than the African and Asian families who have to live with the consequences.

He also cites studies suggesting that parents do truly care about their children and want them to have enough to eat, and he points out that child labor drops dramatically as families exit abject poverty.

I'm not sure if my drive-by synopsis did Landsburg's point justice, but it's well argued in the book.

Building Cars out of Corn

I'm 15 years late to this discussion and don't have anything worthwhile to add to it, but I found this point from Steven Landsburg's "The Armchair Economist" quite profound:

David [Friedman]’s observation is that there are two technologies for producing automobiles in America. One is to manufacture them in Detroit, and the other is to grow them in Iowa. Everyone knows about the first technology; let me tell you about the second. First you plant seeds, which are the raw material from which automobiles are constructed. You wait a few months until wheat appears. Then you harvest the wheat, load it onto ships, and sail the ships eastward into the Pacific Ocean. After a few months, the ships reappear with Toyotas on them.

International trade is nothing but a form of technology. The fact that there is a place called Japan, with people and factories, is quite irrelevant to America’s well-being. To analyze trade policies, we might as well assume that Japan is a giant machine with mysterious inner workings that convert wheat into cars.

Any policy designed to favor the first American technology over the second is a policy designed to favor American auto producers in Detroit over American auto producers in Iowa. A tax or ban on “imported” automobiles is a tax or a ban on Iowa-grown automobiles. If you protect Detroit carmakers from competition, then you must damage Iowa farmers, because Iowa farmers are the competition.

Kill Yourself to Donate Your Organs and Save 5 People?

I've been wondering about a version of the transplant problem thought experiment for years. The way I've always formulated it was this:

Right now, I could volunteer to donate all of my organs, saving at least a handful of lives at the cost of my one life. Five people (or so) get to live, while only one person (me) has to die.

Am I really that selfish to value my own life so much more highly than those of other people, even if they are strangers? I can think of two "economics"-type solutions to this dilemma, but I can't say I buy into either fully.

First, some might argue, sacrificing myself for organs at age 23 isn't optimal. The world would be better off if I live a long time, experience all sorts of utility for myself, and then donate my organs after I die.

I could be wrong, but I think I could save more people donating now, when I'm healthy, than I could by waiting until I die. At that point, I don't need my organs anymore, so the donation is essentially costless, but I would expect that my organs would be in rather bad shape and thus much less useful. Yet I choose not to donate early. (Anyone with a firmer grasp of biology who sees a flaw in this argument can feel free to point it out in the comments.)

Second, one could argue that you can save more lives by living than you can by killing yourself and sacrificing your organs. If you devote your life to some sort of charitable or missionary work, it's easy to imagine scenarios in which this is true.

This is much more of a stretch, but one could also argue that pursuing your goals is better than sacrificing yourself, no matter what your pursuit. Technology and economic progress have allowed billions of people to enjoy so much wealth and pleasure in ways that wouldn't be possible if people were sacrificing themselves all the time. Such societal progress requires expertise and mastery in countless fields, perhaps including the one you want to work in.

Steven Landsburg's book is again the source of inspiration for this post. The transplant problem is, incidentally, a variation of the more widely known trolley problem. The problems typically involve a third party: If you're a surgeon, would you harvest someone else's organs to save five people who otherwise are going to die within the hour? Would you push a fat man in front of an out-of-control train to save five people tied to the track? However, I've always thought of them in the first person: Would I be willing to sacrifice myself to save others?

(Note to relatives and close friends: I'm very happy with life and not at all on suicide watch. It's just a thought experiment!)

Good Enough for Stanford Is Good Enough for Us

University of Rochester economist Steven Landsburg's "The Big Questions" has a fascinating discussion about how we value our own opinions above those of people who are just as smart, capable, and well-informed as we are. This stubborness often leads us to needlessly duplicate the work of others, such as in evaluating job applicants:

[George Mason University economist Robin] Hanson's best guess is that disagreements persist because we tend to overestimate our own intelligence, and therefore tend to put too much weight on our own opinions. One sees this in academic circles all the time. Every year, the members of my department devote prodigious amounts of energy--perhaps half our working hours over a period of several months--to evaluating the qualifications of applicants for faculty positions. At the same time, the faculties of MIT and Stanford are evaluating pretty much the same pool of candidates. Yet we persist in making offers to candidates we believe are strongest, as opposed to the candidates our Stanford colleagues believe are strongest--even though they're surely as well qualified to make judgments as we are. We could save ourselves a lot of time and effort by just announcing a policy that we're willing to hire anyone with an offer from Stanford.

An offer from Stanford is a very credible signal of quality. So credible, in fact, that the University of Rochester could use it as a substitute for its own expensive and time-consuming applicant screening process.

Taking this idea one step further, if such a practice were the norm, all the universities would want some place like Stanford to do all the legwork of screening applicants, while the rest of the universities could pick up the people who decline Stanford's offer.

Of course, Stanford isn't going to make enough offers to support the rest of the system (and it might even begin to make offers strategically to hurt the copy cats). And many, if not most, people with such an offer would accept it. Even expanding the criteria to "we'll hire anyone with an offer from an Ivy League school" or something similar wouldn't cut it, either.

But I could imagine a world in which some centralized body interviews and evaluates all the candidates. Universities would then be willing to hire an applicant if he has a sufficiently high score.

Then again, such mass evaluation has proven imperfect in the past. High school students with the best SAT scores or GPAs don't always become the best college students (though there is enough correlation that these measures still have value). Law students with the best grades or scores on the bar exam aren't always the best lawyers. But does the econ department at Rochester make better hires under the current system, which brings in face-to-face contact and subjective evaluation, than it would if it just based hires on scores? More importantly, even if the current system picks applicants slightly better, is it worth the huge amount of effort the system requires?

Maybe the differences between universities and departments are more important than Landsburg lets on. Perhaps the perfect candidate for Stanford is a poor fit for Rochester, if the programs have different focuses. Also, it would be difficult to assign objective scores to rate the quality of professors in the arts and similar disciplines.