Self-identified liberals & Democrats fail Econ101 questions

[Free Soviets]

i firmly believe that a certain strain of libertarians and conservatives are setting back the cause of academic economics by decades.

Thank you.

heh

it's like, listen, there are important things that econ shows us. how about we not go around acting in such a way as to convince lots of people that the entire field is ideological bullshit, a'ight?

[Franca-Liria]

i firmly believe that a certain strain of libertarians and conservatives are setting back the cause of academic economics by decades.

I agree. The economics courses in schools today are set up to glorify the free-market and its 'near-magical restoration abilities', not to provide objective criticism of its failures, short-comings, and its successes.

[Vittos Ordination]

The poll was designed to trip up liberals and democrats. It completely fails as a comparison between conservatives and liberals.

It still shows, however, that liberals and democrats are also likely to have their interpretations skewed by what they want to be true, just like everyone else.

Then the stupid M and W test was designed to trip up conservatives, libertarians and republicans, how 'bout that?

I don't know what you are talking about.

[Bramborska]

1. Who did they choose? Conservative economic professors and people off the street who consider themselves "liberal"? Do we know?
2. Just because someone self identifies as liberal doesn't mean they are.
3. the economic right continuously posting these stupid and unscientific studies in a desperate attempt to prove themselves smarter and therefore "right" just makes you look insecure.

Considering that it was done by Zogby, a leading scientific polling company whose reputation is so stirling the British are considering replacing their currency with it, you should hazard a guess that it wasn't done like some high school project.

Zogby is hardly part of "the economic right." The Zogby family is deep in left of center politics, and their institution does sometimes swing a bit to the left (if anything) in its polling.

[Yootopia]

"7) Minimum wage laws raise unemployment (unenlightened answer: disagree)." - Wut.

Of the EU countries, Germany has quite bad unemployment and zero minimum wage laws. Also, consider most of Africa. Now that's potentially more correlation than causation, but still.

Thats fairly basic:

Increase in the price of labor -> decrease quantity demanded in labor

OK but you have to play that off against the whole "decrease in the wages of labour -> decrease in the amount of spending money available" effect.

[Meroivinge]

Economics is a social science, like sociology, anthropology, psychology, etc.

Climatology is a hard science like biology, physics, astronomy.

I suggest you review terms and understand them before making arguments by fiat.

If climatology is a hard science why is there no consensus about anything (Global Warming etc etc) ?

There is a consensus about global warming. A consensus is not required for the division between "hard" and "soft" sciences. Natural and physical sciences are considered hard, social sciences are soft. Economics is a social science. Climatology is a physical science.

[Person012345]

"7) Minimum wage laws raise unemployment (unenlightened answer: disagree)." - Wut.

Of the EU countries, Germany has quite bad unemployment and zero minimum wage laws. Also, consider most of Africa. Now that's potentially more correlation than causation, but still.

Thats fairly basic:

Increase in the price of labor -> decrease quantity demanded in labor

However, it also increases the buying power of workers. Which increases demand for products

which increases the demand for labour as as the companies expand amirite?

I believe that most economic systems will work, as long as they are implemented correctly (though I don't believe that some are compaitible with certain political systems. And I don't think anarchy would ever work.

[Hydesland]

not to provide objective criticism of its failures, short-comings, and its successes.

This is not true at all (at least for the majority schools), read any major macro or microeconomics text book.

[Vittos Ordination]

So they reject a grounding in reality?

Not in the slightest.

They reject a grounding in applying the finite human mind to an unimaginably complex and interwoven system of autonomous economic agents.

They also reject empirical studies on the grounds that economics can only study historical records and therefore are inherently impossible to control for.

[Bramborska]

"7) Minimum wage laws raise unemployment (unenlightened answer: disagree)." - Wut.

Of the EU countries, Germany has quite bad unemployment and zero minimum wage laws. Also, consider most of Africa. Now that's potentially more correlation than causation, but still.

Thats fairly basic:

Increase in the price of labor -> decrease quantity demanded in labor

However, it also increases the buying power of workers. Which increases demand for products

Actually, it doesn't increase demand, because the money is in the same company-employee relationship. Transferring the money from, let us say, buying a new window for the store to buying a new window for the employee's house is hardly increasing demand.

The problem that arises is that minimum wage places the value of a worker above its actual value, so even if demand does (magically!) go up; at best it is going up to where the market equilibrium sits.

[Daistallia 2104]

On first read of that Op/Ed, if I had presesnted that for my Intro Statistics and Social Science Research Methods class at university, I'd have flunked.

Shoddy reasearch is shoddy.

[Lunatic Goofballs]

"7) Minimum wage laws raise unemployment (unenlightened answer: disagree)." - Wut.

Of the EU countries, Germany has quite bad unemployment and zero minimum wage laws. Also, consider most of Africa. Now that's potentially more correlation than causation, but still.

IT IS SIMPLY LOGIC....if you value is X and the government forces me to pay you X+y then you will not get the fucking job

Incorrect. It wouldn't be logical for a business that needs labor to accomplish it's goals do do without. Logic would be to hire employees not for what they are worth, but for the minimum they will accept. Setting a higher bar for that minimum isn't going to change a business' need for labor.

Let me ask you this: Do YOU get paid what you're worth?

[Linux and the X]

5) Third World workers working for American companies overseas are being exploited

I'm not sure how anyone could deny that.

6) Free trade leads to unemployment

Not on a worldwide scale, perhaps, but yes, if the labour pool increases but the needed labour remains constant, more people will be looking for work.

[Vittos Ordination]

i firmly believe that a certain strain of libertarians and conservatives are setting back the cause of academic economics by decades.

That is absolute nonsense. How could this even be true? Is there some Austrian illuminati sitting around determining what economic studies are acceptable?

[Abury]

I agree. The economics courses in schools today are set up to glorify the free-market and its 'near-magical restoration abilities', not to provide objective criticism of its failures, short-comings, and its successes.

I have no word

The entire academia setting is screwed toward the hard-far-left

english classes,sociology,psychology,climatology etc etc are so far to the left and an odd with the real world outside their fucking ivory tower that basically they are more a train center for young Marxists than any else

AND ARE YOU SAYING ME WITH YOUR STRAIGHT FACE "ECON(one of the few BALANCED course) GLORIFY THE FREE-MARKET"

OHOHOH

sorry but this is fucking ridiculous

[Hydesland]

I think some people should read this thread.

[Abury]

Let me ask you this: Do YOU get paid what you're worth?

Yes in a free-market Laisse-faire capitalism everyone is getting paid EXACTLY for what they are worth

[Panzerjaeger]

I agree. The economics courses in schools today are set up to glorify the free-market and its 'near-magical restoration abilities', not to provide objective criticism of its failures, short-comings, and its successes.

I have no word

The entire academia setting is screwed toward the hard-far-left

english classes,sociology,psychology,climatology etc etc are so far to the left and an odd with the real world outside their fucking ivory tower that basically they are more a train center for young Marxists than any else

AND ARE YOU SAYING ME WITH YOUR STRAIGHT FACE "ECON(one of the few BALANCED course) GLORIFY THE FREE-MARKET"

OHOHOH

sorry but this is fucking ridiculous

Ah the old if you are educated you are a filthy Marxist...that never gets old.

[Vittos Ordination]

heh

it's like, listen, there are important things that econ shows us. how about we not go around acting in such a way as to convince lots of people that the entire field is ideological bullshit, a'ight?

As if the field of economics wasn't filled with idealogues from the left-side of the spectrum as well...

Conservative economics is basically an also-ran at this point.

Which conservatives are convincing people that the entire field is ideological bullshit, if you don't mind me asking?

[Bramborska]

Let me ask you this: Do YOU get paid what you're worth?

Yes in a free-market Laisse-faire capitalism everyone is getting paid EXACTLY for what they are worth

What? Heresy! Only the government can tell you what you're worth!

[Soheran]

Leaving aside Vittos's correct observation that this deals with the particular issues where liberals are more likely to disagree with the consensus view (why not ask about stimulus spending or a carbon tax?), the questions' answers are also, in several cases, highly suspect.

Let's go through them one by one.

"Restrictions on housing development make housing less affordable."

"Maybe" is the only correct answer for this question: what kinds of restrictions? What about restrictions that demand the construction of affordable housing? What about restrictions of appearance or location that may have only a small effect on housing prices, or that may instead impact other kinds of consumer benefits (like nearness to shopping centers or public transport) that are individually-rational but have negative social externalities for various reasons? It is not too much of a stretch to call the broad statement there--"Restrictions on housing development" as such?--incorrect.

"Mandatory licensing of professional services increases the prices of those services."

Arguable, because of asymmetric information. It is at least conceivable that mandatory licensing might impede natural monopoly power by letting consumers trust new competitors rather than relying on companies that have a record of good service. Or that high pricing might become a market signal of good service, producing an inverse of the classic relation between price and quantity demanded. If consumers knew everything about every good and service they bought, we wouldn't need quality regulation. But they don't, so we do. (Undoubtedly licensing also has less positive effects in the real world, but these are very general assertions about causal relations, not careful, nuanced statements.)

"Overall, the standard of living is higher today than it was 30 years ago."

Arguably false for a large portion of the population. Most income gains from growth have gone to a minority. And new consumer products are a mixed bag, especially included with other cultural changes that might have taken place over the past thirty years. (What would we do if most people said that the standard of living was lower? Might that be reason to reject our understanding of standard of living rather than their judgment? I thought economics believed in subjective value?)

"Rent control leads to housing shortages."

The consensus view on this one is probably correct, but in the absence of specific information of the kind of affordable-housing policy being discussed, the conclusion is perhaps debateable.

"A company with the largest market share is a monopoly."

I think this is just a semantic issue. It's true that liberals are probably quicker to label businesses monopolies than others, but I highly doubt that if you showed a market with a hundred nearly-equal players in it, any reasonably-educated liberal would say that the one with the highest market share--say, 1.1%--was a monopoly.

"Third World workers working for American companies overseas are being exploited."

This one is plainly more disputable than the question suggests. It is true enough that productivity differences explain a lot of the difference between First World and Third World workers, but weak or unenforced labor regulations, a lack of collective bargaining, and sometimes raw force have something to do with it, too. Only if you are a free-market radical who thinks unregulated labor markets work perfectly, and you have an extremely naive view of what labor markets in developing countries look like, could you suggest that the response to this unqualified assertion is clearly "disagree."

Fuck, we don't even have a consensus definition of "exploitation" in the economics context--what does this question even mean? Shouldn't even someone who thinks, as the saying goes, "The only thing worse than being exploited by the First World is not being exploited by the First World", answer "agree"?

"Free trade leads to unemployment."

I'm a pretty strong supporter of free-trade policies in developed countries, but I think I could answer "agree" to a qualified version of this statement, as could anyone who recognized that transition costs are non-zero.

"Minimum wage laws raise unemployment."

This is one of those cases where the empirical evidence is ambiguous (at best) compared to the classic theory. And it's easy to construct a reasonable theory where minimum wage laws do not have this effect, and may even reduce unemployment: if labor markets are not perfectly competitive, for instance.

[Hydesland]

They reject a grounding in applying the finite human mind to an unimaginably complex and interwoven system of autonomous economic agents.

If you're referring to Hayek and others criticisms of central planning, that has almost no relevance to econometrics.

They also reject empirical studies on the grounds that economics can only study historical records and therefore are inherently impossible to control for.

This is completely incoherent. If you think you can't control for a variable in statistics you need to seriously brush up on your mathematics. If you're referring to the Lucas critique, this only applies to some types of studies (after-all Lucas is himself an econometrician and is not shy from empirical work).

[Vittos Ordination]

OK but you have to play that off against the whole "decrease in the wages of labour -> decrease in the amount of spending money available" effect.

Decreases in wages logically implies price deflation as well, so less money would be needed.

[Hydesland]

Which conservatives are convincing people that the entire field is ideological bullshit, if you don't mind me asking?

The person in this very article, for instance.

[Person012345]

Let me ask you this: Do YOU get paid what you're worth?

Yes in a free-market Laisse-faire capitalism everyone is getting paid EXACTLY for what they are worth

LOL

No, they get paid the minimum they can be paid. Which, when there is no help for the unemployed and regulation from the government, is very little for many people. Sometimes even nothing, but they still have to go back. Take a look at [insert eastern developing economy here].