Sunday, January 29, 2012

Do the poor "deserve" their poverty?

Noahpinion has some good thoughts on this question that Bryan Caplan and Karl Smith are going to debate soon. Some of it waxes utilitarian: "When I witness the urban blight, violence, drug abuse, and other social ills that poverty may be causing, as a non-poor person I have an interest in preventing these social ills from affecting me, regardless of whether the ills are "deserved."".

This is a good point too: "That said, I think the Caplan definition of "deserve" is not as "uncontroversial" a moral premise as Caplan declares. The reason is that it is a partial-equilibrium definition, not a general-equilibrium one. If we live in a society in which X percent of the populace must be poor, then no matter what set of actions is taken by the population, some people will wind up in poverty. To see this, imagine that we lived in a society in which the hardest-working 50% of people get to be spectacularly rich, and the other 50% are forced to live in squalid poverty. In this society, if everyone raises their effort by 1000%, the number of people in poverty stays exactly the same. I doubt that most people would say that the lower half of the population "deserved" to stay in poverty after raising their effort by 1000%! But that is exactly what Caplan's definition implies."

Persistent underutilization of the factors of production - among them labor - is usually considered to be a macroeconomic question requiring macroeconomic answers. For some reason, though, a lot of poverty gets discussed in microeconomic terms. I've never been quite sure why.

One concern of mine about this talking about "deserving" poverty is that whatever decisions people make that put them in poverty aren't made in a vacuum. When you're a kid you are crucially dependent on the investments that society makes in you and that your parents make in you. If there are youth populations that parents and society systematically underinvest in, those populations are going to end up with higher poverty rates. Now, we probably could trace that to decisions they make in almost every case. Even factors out of their control can ultimately ascribed to their own decisions. Depressed local labor markets? Why didn't you just set out on your own - why didn't you move? But that seems to miss the point. Would anyone else, put in the same circumstances growing up, have made different decisions on average? Probably not. There's plenty of variation in human behavior and that variation does affect outcomes - but it's still constrained by these circumstances.

This distinction between "equality of opportunity" and "equality of outcomes" is largely made up. If you give a poor black kid and a middle class white kid a "color blind" college admissions test or a "color blind" employment test, you can't call that "equality of opportunity". Opportunity goes considerably deeper than the immediate circumstances of any given choice. Opportunity is something that builds up over years of investment (or lack of investment) in a kid.


  1. Not that it matters---you seem oblivious to real learning---but the poor are poor because we have failed to provide them with an environment substantially free of crime. It really is that simple.

    Jim Clifton, head of Gallop, wrote an excellent book last summer, The Coming Jobs War. The title is misleading. Clifton actually has done an extraordinary amount of work into why societies do or do not prosper. The answer is very simple. Crime and the fear of crime is what causes poverty.

    If you are afraid of crime, you will not leave your home (someone will steal your belongings), invest in transportation, stay late at school, or open a business, etc. etc. You will not shop at a business in an neighborhood believed to be unsafe. etc.

    The great crime in America is that we waste billions trying to heal the victims, when what we should be doing is spending billions to stop crime in the first place.

    1. If - instead of leading with an insult - you just made your point, you'd be pleasantly surprised to know I agree and certainly have thought about the role of crime long before you came here.

      Look, I know you're new here so I'll fill you in on how this blog works. We can be highly critical of each other in the comment section, but if you jump into the insults nobody is going to like you or want to respond to you.

    2. Daniel, simply put, my point of departure with you is you statement that "decisions people make that put them in poverty."

      Victims of crime have not made any decision.

      Let's take a real world example, a family that owns a home in Detroit, Chicago, Cleveland, large parts of St. Louis, LA, etc., that has just seen the City evaporate around them in the last 30 years, as firms have closed mfg. plants and moved good paying jobs either south to low paying jobs in the South (an event you support as you are anti-union, anti-labor) or to China (again, which you support). One day, they wake up in a world of crime.

  2. @JLD: There really isn't an answer as simple as that. In India, for example, crime isn't such a big factor. It is, as the writer of this blog says, lack of investment in people: which is really inequality of opportunity.

    1. Yes - my agreement with him is that it's an important factor in the U.S. - not that it's the only factor.

      These are interrelated too. When you illegalize drug use and don't have other job opportunities, a rational person is going to seriously consider the drug trade. As long as that's illegal, it's going to come with a lot of other criminal activities completely incidental to the drug trade itself.

      These things are not unrelated.

  3. I must come back to: is there a single RW position that isn't explained by the just world fallacy?

  4. @JLD

    US crime rate has been falling continuously and substantially for two decades now, so it's not the most pressing issue.

    Jaai Vipra is right. The homicide rates in Bangladesh and India are among the lowest in the world, and yet those are also the poorest parts of the world.

    The relation between crime and poverty is zero. Relatively rich or middle income nations have plenty of crime - look at Russia, look at Venezuela, look at Britain, and so on.

    1. the crime "rate" for a country as a whole and where poverty is located are two different things

      nor am I talking about just murder. Having to bribe a public official for a permit is also a crime.

      I am no "expert" on India, but what I see holding back India I would call a crime, especially bribery and extortion.

      I am a hands on expert on inner city crime and poverty in the US. Crime and the threat of crime is the key driver of inner city poverty. Until people are safe and secure you cannot make real progress in fighting poverty. Your efforts are just "stolen." The opportunity cost of opportunity is too high. That, and bribery and extortion. Most inner city municipal gov't are a very sophisticated extortion operation. For example, in my city we have about 30 alderman who have total veto power over every aspect of business or commercial activity. If you want to put up a sign or tear down a building or open a beauty solon or do anything it takes a city ordinance. All alderman have agreed not to override the local alderman, so you have nothing but bribery or extortion. You ask for a permit. You are asked, I don't see your name as a contributor to the party. Or, my Uncle paints, have you asked him for a bid. Or, you need to hire this PR firm to support you ordinance.

      This is crime, plain and simple. That it is not effectively prosecuted doesn't mean it isn't a crime.

  5. Daniel,

    While I am sympathetic to the thoughts in your post, one problem I have with this general approach is that it comes very close to entailing the claim that no one deserves anything ever and that all of your personal characteristics are morally arbitrary, an implausible conclusion (in my mind anyway). This is not the place to determine once and for all which egalitarianism is the correct theory, but I do find much of the on-going debate misguided because of this line of thinking inspired by Rawls.

  6. The important thing here is production. If people are paid for low production, or for no production then we will get a lot of that.

    I'm a long run utilitarian, I'm not so concerned about now, I'm concerned about the incentives set for the future.


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