Revealed preferences and unions

Taylor Swift by David Shankbone 2010 NYC

Image by david_shankbone via Flickr

Many assertions and studies comparing union and non-union pay have been circulating since the teachers union in Wisconsin have been demonstrating against the representatives of their employers this past week.  Some say union workers are overpaid, some say they are underpaid and others hold that there are too many factors to make a fair comparison.

I think most of the logic that goes into such comparisons is bad.  Whether someone is underpaid or overpaid is up to them to determine, and it’s not something that is easily ascertainable by third parties.

We each value things differently and have different preferences and situations.  Some people like football, some like Coke and some like Taylor Swift.  But not everybody likes them.

It’s very difficult to capture those preferences in studies.  But, I think we can learn a lot by how people behave.

It occurs to me that if the union workers in Wisconsin were not overpaid in some regard — be it salary, job security, benefits or in some other non-monetary aspects of their employment trade-off — they wouldn’t care nearly as much about it as they appear to.

Another thought occurs to me.  Nearly ever time I patronize most stores the workers there thank me.  I can’t remember the last time someone from my local school district thanked me for paying my property tax, which funds their job.

2 thoughts on “Revealed preferences and unions

  1. The phrase, “demonstrating against the representatives of their employers this past week” is fantastic. Well done, sir.

    • Thanks. I’m glad you liked it. That’s funny. While editing I thought about being more specific on that, but decided to let it float.


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