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Define Coercion… Or Else!

May 8th, 2007 · 4 Comments

Dan Klein has a long and interesting Cato Unbound essay that takes as its starting point the somewhat puzzling finding that more than half of economists in a recent survey believed that minimum wage laws were “not coercive in any significant sense.” Klein takes this result to be explained by the negative connotation of the term “coercive,” which made economists who support minimum wage regulations reluctant to apply that label. And that’s plausible enough, but I can think of at least two other reasons, especially if you’re willing to lean a bit on that qualifier, “in any significant sense.”

One possibility is simply that most economists believe the minimum wage to be low enough that it’s not actually inflating people’s pay or labor costs above the market wage for the vast majority of workers. If that’s the case, then minimum wages are typically coercive in roughly the same way that “breathe, or else” is coercive: There’s technically a threat involved, but most people end up doing roughly what they would have done anyway.

The other possibility is that the economists are reading “coercion” in a Hayekian sense—a definition I vaguely recall Klein having elsewhere argued against. The idea here is that a sufficiently stable and neutral rule, while “coercive” in the sense of having a humanly imposed penalty attached, takes on more of the character of a natural fact, like gravity, around which people can and do arrange their long term plans. On this view “coercion” is reserved for unpredictable ad hoc demands to comply with the will or judgment of particular persons. Whether we prefer this definition to the more colloquial one depends largely on what sort of distinctions we want to make, and I’m inclined to think that relatively little turns on one or another use so long as we’re clear about which one we mean in different contexts.

Tags: Economics


       

 

4 responses so far ↓

  • 1 Glenn // May 9, 2007 at 12:20 am

    It seems to me that we should use Occam’s razor here and conclude that they are saying it isn’t coercive because they want to avoid what they know will follow, namely an argument against the minimum wage that flips between trivial and substantive definitions of coercive.

  • 2 steveintheknow // May 9, 2007 at 10:03 am

    I am surprised that anyone would argue (honestly) that it isn’t coercive. After all, if it isn’t then what’s the point?

    It seems to me that the MW exists to correct an injustice, and the only way to do that is coercively. So is there really no injustice to remedy?

  • 3 Anonymous // May 22, 2007 at 12:48 am

    I don’t really see the difference between the distinctions drawn in your second and third paragraph. The premise of both is the same, and that’s coercion is as coercion does.

    But you know, that’s how I think I’m going to start referring to the Rockwell/Rothbard-type libertarians: “coercion libertarians.”

    yours/
    peter.

  • 4 Julian Sanchez // May 22, 2007 at 6:13 pm

    In the second paragraph, I’m suggesting that people might not apply the term “coercion” because the action in question doesn’t actually alter people’s behavior–it insists they do what they would have done for other reasons.

    In the third paragraph, I’m suggesting they might not apply the term because, even if the rule does change people’s behavior (if not for the rule, they would pay less), it does so in a highly stable, uniform way