≡ Menu

Bonus Quotation of the Day…

… is from page 451 and page 828 of the 3rd edition (1972) of what is correctly regarded by many to be the greatest economics textbook ever written, University Economics by Armen Alchian and William Allen; the first part of the quotation is Question #30 at the end of Chapter 22; the second part of the quotation is from the answer given, at the back of the book, to the question (link added):

images“If an enterprise cannot survive except by paying wages 75 cents or $1 an hour, I am perfectly willing for it to go out of business.  I do not believe that such an enterprise is worth saving at that price.  It does more harm than good, socially and economically.  It is not an asset; it is a liability.  So if this kind of business is killed by a minimum wage of $1.25, I for one will not be sorry.”  (George Meany, Hearings before Subcommittee on Labor Standards, 86th Congress, 2nd Session, 1960, p. 36 of Part 1 of printed hearings.)

a. How does this statement differ from one that says, “Any person who cannot produce a product worth at least $1.25 an hour should not be allowed to work as an employee?”

a. Doesn’t differ except in degree to which it reveals implication of what is said.

DBx: I thank Steve Pejovich – who earlier sent me this e-mail – for reminding me just where this Alchian-Allen insight appears in the Third Edition of University Economics.