The Happy Meal Fallacy

ParanoydAndroid · 8時間前

This seems like it's a bit of a spherical-cow fallacy that ignores too many externalities to be a useful guide to real world policy.

lurgi · 3時間前

This sounds only one step removed from the simplistic argument that raising the minimum wage must reduce employment because of supply and demand. Which is true, if you ignore absolutely everything that makes the labor market interesting and your economic knowledge stops at "Everything I Know About Economics I Learned Trading My Lunch In Elementary School".

It's entirely possible, for example, that if every meal is served with fries and a drink that the cost of supplying that fries and drink will go down relative to the price where it's optional and that that new price is a big win for everyone.

Going to the contractors/full time employees, it's also worth noting that, in many cases, employees are customers (not in all, but in some). Giving them more money and more economic stability might actually be good for the bottom lines of the company. Or not. Beats the hell out of me. My economic knowledge does stop at EIKAEILTMLIES, but at least I recognize that fact.

aksfjh · 7時間前

First off, he fails to account for the benefit the employee/employer get from the economy of scale of it. Insurance, 401ks, toilet paper, etc., all become cheaper when bought in bulk. The discount should increase benefits and/or wages compared to a scenario where the worker would pay for it alone.

Secondly, he seems to confuse which workers benefit more from non-wage compensation. Yes, in a world without a safety net and a minimum wage, outright wages would mean more. However, we don't live in that world and he's not arguing from that position. Since people have enough money from wages and welfare (due to the safety net) to provide shelter, eat, and otherwise live day-to-day, the benefits gained from a pool of employees under a single employer are much better for those that need protection from catastrophe.

Those that benefit least from this compensation are those that already have them or have little need for them, people who are doing alright already. The benefits are redundant or unnecessary, so the wages lost to this arrangement are just that.

What's odd about him bringing up the poor in this at all, he's aware of the minimum wage statistic that states that most of those working minimum wage are part of households out of poverty. That seems to contradict the view that marginally higher contractor wages would somehow benefit the poor any more than an increase in minimum wage would.

taleinat · 8時間前

I couldn't disagree with this more...

A) People "choose" what food to buy according to preference, but employees don't "choose" jobs with lower benefits - they usually take the job with the highest wage and benefits that they can. Allowing employers to offer jobs with lower benefits reduces their expenses at the direct expense of the employees. Just like there is a minimum wage, there should be minimal benefits and protections for employees. And these protections exist! Hiring contractors is a way around those protections, which has become widely abused.

B) Some people order just a hamburger because it is by far healthier to eat just a burger rather than a burger with french fries and a soft drink. French fries are soaked with unhealthy fats and soft drinks are full of simple sugars (or alternative sweeteners, which are also being shown to be unhealthy).

tazias04 · 5時間前

fuck fries.

I want 3 mcjunior's and peace.

surprisesugarfree · 2時間前

Is no one concerned that someone out there thinks adding fries and a soda to a hamburger makes for a more complete and healthy meal?

RT17 · 7時間前

Arguments from analogy are perhaps the most specious of arguments.

ontopic · 7時間前

Meanwhile, in real life, employers are floating the idea that there aren't enough skilled workers for tech positions while colluding to fix wages across the industry.

Putting aside that the "Happy Meal" metaphor is just awful and dumb, this is a ridiculous concept.

beguiledfoil · 3時間前

Some restaurants offer burgers without fries and a drink. These restaurants cater to low-income people who enjoy fries and drinks but can’t always afford them.

This is not why restaurants offer individual burgers... I can't believe articles like this generate serious discussion. This is praxeology at its worst.

OliverSparrow · 3時間前

This is one of those strained analogies that take discussion into irrelevant detail. "Marriage is like setting off on a long sea voyage", and then everyone starts talking about cabin trunks and life boats.

The question could go in one of two ways. In situations of high employment, would you. Sir, prefer highly paid part time work of lesser paid permanent work with all the trimmings? That is not the sense of the question, however, which tends int he other direction: in times of surplus labour, is it better policy to clear the market in any way that is available, or to dictate that certain boxes have to be ticked before people can work? And if you prefer to go with the box ticking, monitoring route, then what are sensible limits to this? Factories Acts that keep child workers out of the machinery are generally held to be a Good Thing, at least in the wealthy world. Requirements that price a significant number of low skill people out of work - and consequent make-up welfare funding to handle this - is increasingly seen as foolish. Where the dotted line should go is not an economic question, however, but a political one.

realy · 3時間前

I might have some insight here as someone that use to be an employee but now does the exact same job as an independent contrator. First I will say the whole premise of this article is false, because very few people actually get to decide whether to be contractors or employees. I personally like being a contractor, but I can see how it would be hard for someone with less income and a family to support.

Benefits: I pay far less in taxes because of the way s-corps work and my ability to deduct expenses, but this wouldn't be the case for everyone. I also can demand a higher wage because it is easier to shop around for who pays best. Plus I can take on jobs on a temporary basis without quitting my current job.

Cons: Lack of access to credit. I can't even get a mortgage right now despite a great credit rating, good income and large savings. Banks require you have at least two years of 1099 income before lending, so until next year I can't get a mortgage. Also, no health insurance. I buy my own, which as a young single person is cheap, but this is really hurting some of my coworkers with families. Don't care about the 401k.

Overall I like being a contractor. However, if you are lower income, you really can't take advantage of the tax savings an s-corp affords. Plus you can't afford a good accountant. I'd complain about lack of health insurance, but most jobs on the lower income spectrum don't offer it anyway. Plus my current health insurance is actually cheaper than what I was being charged by my previous employer as a regular employee.

usrname42 · 58分前

A lot of people in this thread need to read The Accidental Theorist.

weekendofsound · 5時間前

Buying a happy meal has NOTHING to do with benefits. These kind of arguments are feeble minded horseshit. At some point, every single worker SHOULD go to the doctor, and going to the doctor is beneficial to both the employer and the employee because it can help prevent illnesses and therefore will maintain productivity. An intelligent employer will understand that this is an investment in your workforce - that employees with good benefits are going to be more satisfied and more productive and will have less stress in their lives than employees who have to buy these things off the "free market."

This is a huge issue with our culture that MUST be rectified - a certain portion of Americans that we have no responsibilities to collective society is going to fuck us over when we can no longer compete in the global market because our population is uneducated and unhealthy, and those same citizens came to that conclusion through false analogies like this one.

Ateist · 6時間前

Would a law requiring firms to provide all workers with fries and a drink help workers?

Depends on the salary before and after. If the wages are extremely depressed (i.e. at minimum wage) due to overabundance of unemployed people, adding mandatory benefits would indeed help workers (as long as the firm doesn't close and the workers are not also co-owners of the firm) .

Available_user-name · 5時間前

I would never buy fries or soft drinks (besides water), and know other people who wouldn't. Not sure why it is assumed that everyone would want them

kwh · 4時間前

This reasoning lacks historical context. Bear in mind that the entire concept of worker benefits came out of the post-war boom when it was referred to as "fringe" benefits - a way to attract the best talent in a workforce glutted with returning veterans and the winding down war industry, as well as an economy transitioning from rural/agricultural to suburban/commuter on the way to post-industrial.

Offering things like health insurance or retirement benefits through employers rather than "on the market" was seen as a win-win-win - employers got the best talent and their health was protected, employees got benefits without having to manage for themselves, and health insurers as example would benefit from lower admin costs in selling to large groups, community rating, etc. That's why we saw the establishment of laws around making many of these benefits tax-advantaged for the employer - tipping the scales in favor of this arrangement.

The entire thrust of this article is around the "gig" economy, which may be a reality for some (tech workers in large cities, designers, developers, single young professionals and "change agents", etc) but regular full time employment is certainly still a reality for most, especially those who are householders and have families.

Anyways, the subtext of this article seems to be around mandated healthcare coverage, which is a hell of a lot different from fries with your happy meal. The fact remains that the best way to pay for all of the needs of healthcare (trained professionals, facilities, technology, pharmaceuticals) is through prepaid universal coverage, whether single or multiple payer. (what we refer to as "insurance").

A staffed hospital emergency room doesn't spring into existence when a "gig" worker needs it, and imagining it as interchangeable with a French fry or an iphone or other fungible consumer good is ignorant.

slash196 · 3時間前

Taking a job is not in the same universe as buying a burger. The insistent desire to reduce every aspect of humanity to a "purchasing a trivial good" decision is one of the most frustrating aspects of economics and economists.

Mimshot · 2時間前

I'm confused. Is the fallacy that the article is reversing which side is supply and which side is demand in the labor market?

Millhouse201 · 1時間前

Classic case of the straw man fallacy in twisting the logic tp firms and contractors... The theory of imperfect knowledge is more appropriate

lizzwashere · 1時間前

Great argument for universal healthcare.

Gunsandwhiskey1791 · 1時間前

This is a truly useless analogy considering the social context of healthcare regulation.

-Individuals require healthcare whether or not they are participating in the labor market.

-Most Individuals lack negotiating power relative to firms that hire them. Firms often collude to limit the costs of labor competition, structuring compensation to deviate as little as possible from industry averages and forcing the most competitive employees into non-compete agreements. Stagnant wages for the last several decades in much of the west demonstrate the impact of labor cost containment initiatives.

-Where there is a surplus of labor, individuals compete not only on their ability to produce, but by their ability to accept less than the competition. The social consequences are significant and demonstrated by the labor conditions in the developing world.

-Individuals forced to rely on wage labor for their subsistence cannot simply leave the labor market in protest without facing poverty.

SeanCanary · 28分前

Increases in cost to production are not borne soley by the consumer (they are borne by the consumer and owner, though not always equally). This fallacy is...fallacious.

pbrettb · 6時間前

Amazingly interesting bad logic. He tries to say gaining a certain level of employee benefits is akin to choosing a larger than normal food order. What he doesn't say is that the employee/management relationship has inherent conflicts of interest which tend to make it that without rules keeping both sides honest, either side will try to screw the other.

Fremen13 · 4時間前

It’s implausible that firms and workers will overlook mutually profitable exchanges.

Can someone explain this part to me? Throughout my undergrad degree, my professors kept telling me about how there's an economics joke that if two economists walk past a $20 bill on the ground, neither will pick it up since if it was real and free money, someone else would've picked it up already.

It seems to me that he's making this argument that firms and workers are perfectly efficient and do these calculations regularly (while anyone who has worked in the real world knows that this doesn't happen for the jobs we are talking about).

drukath · 2時間前

Even though everyone likes fries and a drink they may not like the added benefits by as much as the increase in the price of the meal. Indeed, this must the case since consumers could have bought the meal before the Act but chose not to. Requiring firms to sell benefits that customers value less than their cost makes both firms and customers worse off.

Maybe the customer did like and value the fries and shake more than the increase in cost but could not afford it due to budget constraints. These customers would have bought just a burger but now they can buy nothing. This results in a reduction to the happiness of the firm (see what I did there?). As their revenue falls they try to attract those customers back by lowering the cost of the happy meal. Now people who would have bought the entire meal before are happier because they do so at a reduced amount. People who would only have bought a burger before may be in a position to finally buy the entire meal because the reduced cost puts it within their price range. So people are happier.

This 'fallacy', like much of Adam Smith's work, fails to acknowledge dynamic processes and is therefore a pile of shit.

judgej2 · 6時間前

This sounds like an argument between the provision of a fair and just society, and me-me-me. Different cultures and countries, put values on the burden that we share as a society, and not just treat every rule as government sticking their nose into what I demand.

Economics

Featured Related Subreddit

Subreddit Rules

調停者