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November 22, 2006

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Igor Belanov

Wouldn't most managers use modern, efficient machinery rather than old stuff that's been out of repair for months?

Sam

This in turn suggests that it's too simple to say that it's "fair" to pay someone their marginal product. Is it really fair that a man's pay can vary widely through factors beyond his control?

Of course it's fair, unless you have an incredibly utopian definition of "fair". Let's say that I am a highly skilled designer of garden gnomes and the like. If the public acquire a taste for kitsch tat, I'll make a lot of money. If the public has some aesthetic sensibilities, I'll be in the poor house. I have no control over the public taste. Is it "unfair" that skilled makers of buggy whips should find themselves discomfited by the introduction of the automobile?


Maynard Handley

I heard a talk by Coase in which he claimed
"2. They help explain the existence of firms. If two assets only work well together, each has an incentive to threaten to pull out in order to bargain for a bigger share of the output. This is the hold-up problem. "
that this was specifically NOT the case. He had been talking to car makers in the US and the manufacturers of something very specialized that was only of use to one car-making firm (stamped auto-bodies or something), and he concluded that although it would naively appear that they should be one firm, they managed the hold-up problem quite fine using contracts.

He further claimed that his theory of why firms existed was frequently explained in this way, but this was not what he meant. So far so good. Unfortunately I'm clearly rather dumb because I could not quite understand exactly what he did then think was the justification for the firm (cost of transactions and information flow?)

Paulie

Oddly, the Unions never show more than a token interest in worker-control. Ministers in the 1945 Labour government couldn't interest Miners leaders in the idea and I've discussed it with well-placed members of the UK rail Unions and been told that they aren't interested. I can hazard a few slightly misanthropic explanations for this, but nothing that I'd be able to defend for very long.

Any ideas?

dsquared

the economics here is excellent, but I cannot let Chris's loony ideas about cricket go unchallenged. Panesar hasn't been picked because he can't field, can't bat and his bowling is really not good enough to stand on its own. He's a left handed fingerspinner which is a rarity, but he doesn't have much variability and would have been found out really badly against Australia. One good test in India on really favourable pitches does not make someone an automatic pick.

ManBearPig

Oddly, the Unions never show more than a token interest in worker-control. Ministers in the 1945 Labour government couldn't interest Miners leaders in the idea and I've discussed it with well-placed members of the UK rail Unions

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