Finished No One Makes You Shop At Wal-Mart
Like Tyler Cowen, I found a good chunk of NOMYSAWM oversimple. A lot of it could be rebutted with “Well, you have your story and I have mine,” and both those stories would be equally valid until we had some models and some numbers to look at. If you’re looking for the models and the numbers, and you’re of a quantitative bent, check Bowles’s Microeconomics. (Slee cited Hal Varian’s Intermediate Microeconomics along the way, so I put in a request for that at the library.)
In particular, Slee argues at one point that the market for lemons guarantees that jobs will tend to be dominated by those who are already part of the old boys’ network: since corporations can’t be sure of the quality of incoming applicants, they’ll tend to rely on easier-to-acquire measures of the applicant’s quality — such as that the CEO knows him. So the same people will always end up with the jobs, hence on top. In this way, Slee argues, rational choice leads directly to persistent inequality.
That’s one story. Another story might run like so: those who grew up poor (for instance) are much less knowledgeable about their own value than are those who grew up in privilege. Hence they’re likely to do work for cheaper than those with more knowledge. So if the cost of searching among low-income applicants is low enough, it can be worth a company’s while to engage in that search and thereby undercut their opponents. Over time, firms may well form which have a reputation for spotting diamonds in the rough. The free market rides in and saves the day once more.
Those are just stories, with more or less intuitive plausibility. As Henry Farrell put it recently, “$4.50 and a logically consistent story that accords with intuition will get you a venti latte at Starbucks.” We need data.
Slee’s job isn’t to provide that data. His job is to break through the fog of our existing cultural intuitions — such as the classic idea of “choice.” And in that he succeeds admirably.