Inequality

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JasonL
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Re: Inequality

Post by JasonL » 28 Nov 2019, 07:46

Appears so. Nevertheless that’s a regulatory floor not a productivity at density floor.

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Shem
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Re: Inequality

Post by Shem » 28 Nov 2019, 11:38

JasonL wrote:
28 Nov 2019, 07:46
Appears so. Nevertheless that’s a regulatory floor not a productivity at density floor.
And if the productivity weren't able to support that floor, you'd see either businesses closing or a reduction in the number of jobs available. Neither of which are happening in places like NYC or Seattle that have or are moving into the $15 minimum. Do you think Cincinnati would be similar if they instituted that minimum?
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JasonL
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Re: Inequality

Post by JasonL » 28 Nov 2019, 12:50

There is some margin where you are right and another where I am right. I agree long term jobs will not persist if their costs exceed their productivity and that varies by region. My contention is you can’t solve the cost of living adjustments or even come close by mandating low skill jobs pay comparable ratios because the costs are multiples of the productivity.

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Re: Inequality

Post by thoreau » 28 Nov 2019, 13:55

JasonL wrote:
28 Nov 2019, 12:50
There is some margin where you are right and another where I am right. I agree long term jobs will not persist if their costs exceed their productivity and that varies by region. My contention is you can’t solve the cost of living adjustments or even come close by mandating low skill jobs pay comparable ratios because the costs are multiples of the productivity.
Nobody here (to my knowledge) supports high minimum wages (and few support any kind of minimum wage).

You keep insisting that low-skill workers ought to leave NY, SF, LA, etc. Implicit in this prescription is a notion that there will be substantial improvements in their conditions if they move to the right locales (and presumably also improvements for those who don't leave, due to less competition for jobs and housing). The basic question is whether the numbers add up, if there are enough opportunities in "middle" cities to absorb so many low-skill workers that the new equilibrium is substantially better.

If there are, great. We should drop off U-Haul brochures in poor neighborhoods. If not, it doesn't mean that we should instead do whatever Bernie and Elizabeth Warren want, but it does mean that lack of geographic movement is not sufficient to indict poor workers for not trying to improve their lot.

And that's before we take into account the hard-to-measure but nonetheless real cost of moving away from friends and family who can babysit, give you a ride when your car breaks down, etc.
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Jadagul
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Re: Inequality

Post by Jadagul » 28 Nov 2019, 14:47

JasonL wrote:
28 Nov 2019, 12:50
There is some margin where you are right and another where I am right. I agree long term jobs will not persist if their costs exceed their productivity and that varies by region. My contention is you can’t solve the cost of living adjustments or even come close by mandating low skill jobs pay comparable ratios because the costs are multiples of the productivity.
1) That seems like a good argument for bringing costs down.

2) In the graph you posted, income after cost-of-living roughly tracks income before cost-of-living, and the Bay is one of the highest adjusted incomes on the chart. Now, the chart tracks median rather than 25th percentile, and also tracks the entire metro area and the whole point is that there's a big difference between living in Manhattan, living in Brooklyn, and living out at the edge of Nassau or something. So the chart isn't exactly on-point for this question, but it doesn't exactly support your position either.

3) I think you want to argue about whether individual people are making good decisions. And I'm sure some of them aren't! But I don't think that's a super interesting question to litigate, because individual people are individuals. Some people who aren't moving are making a bad decision and other people are making a good decision. And from a state's-eye perspective I don't know how you could tell which is which.

4) If you do want to address that question, I think you've misidentified the choice people are actually making. People mostly aren't deciding whether they should move to Dallas for the lower cost of living; they're asking if they should move out to Bakersfield for the lower cost of living. Which is why my (really excellent) hairdresser spent years with a ninety-minute commute before she finally cut back to only coming in to the city one a month, and just took the income hit from doing most of her business in Bakersfield where she can't charge nearly as much.

5) Which brings us back to the original point, which is that having to work in Bakersfield rather than in Pasadena is a noticeable reduction in income. Like, if we believe your original numbers on Starbucks wages, that's a 25% raise! A 25% raise is pretty substantial. That's the sort of thing that people change jobs and move cities for; it doesn't make sense to treat that as a negligible difference.

---

To circle back to the beginning: It seems like we all agree at this point that incomes are _higher_ in dense areas, even for entry-level and low-skill jobs. The questions are whether that extra income all gets eaten up by higher costs of living, and then secondarily whether that means people are making bad decisions when they stay in high-income high-cost areas.

But from a _policy_ perspective, the question should be how we can get those costs of living down, so people can benefit more from the higher incomes and increased productivity. And that's not needy whining; that's an attempt to get the fucking regulatory state out of the way and reduce barriers to market provision of scarce, in-demand goods. And I don't know why you're fighting against that so hard.

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JasonL
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Re: Inequality

Post by JasonL » 28 Nov 2019, 19:03

I actually don’t think anyone here opposes opening regulatory barriers to new construction. I don’t. I just don’t think it will do anything close to what you think it will do. I think expanded density is not frictionless and you get some positives up to some modest level before you start running into forces that again mitigate benefits. Like, if the vector of higher productivity is not output but an increase in price level that hits low skilled people.

I think density helps specialization but low skill people are by definition not doing things that get multiples from further specialization. Initial complexity is a part of unleashed value at scale. You aren’t making too many more lattes per head per hour than you are at the busiest cafes elsewhere. The cost of living in Cincinnati is 60% lower than Manhattan. To “get a raise” and to do it without increasing price levels in the face of that kind of number? At low skill job?

You have to do a lot in cost compression while not messing anything else up to get that raise.

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Re: Inequality

Post by lunchstealer » 29 Nov 2019, 13:27

D.A. Ridgely wrote:
26 Nov 2019, 09:05
Shem wrote:
26 Nov 2019, 02:08
D.A. Ridgely wrote:
25 Nov 2019, 22:15
Driverless cars might fix LA, or at least considerably ease the pain.

The major metro areas in Texas are still affordable. Yeah, it's Texas, but there is little that isn't absolutely unique to LA or NYC that isn't available in DFW and the thing about poorer people in large metro areas is that they can't really afford all that much of the good life no matter how close it may be to them. For that matter, for overall quality of life places like Austin or Charlottesville, however expensive they may seem compared to most other cities their size, are extremely livable and affordable. Especially younger people without children have, it seems to me, precious little reason not to move rather than complain that this place or that place is too expensive. Unless you're rich, every house or condo you might actually want to live in is "too expensive" when you're a first-time buyer.
Semi-related; have the floods in Houston prompted any changes to zoning requirements down there to alleviate the risk of future floods?
I don't know. Like most people who live in DFW, I mostly just sneer at and otherwise ignore Houston.
Houston is that place where the traffic is annoying if you're going to Galveston.

Well, that and the rest of I-45.

And US75.
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