≡ Menu

Taking Leave of Economic Reality

Here’s a letter to RealClear Policy:


Writing in support of mandated paid family leave, Abby McCloskey and Angela Rachidi ask the wrong question and reach a mistaken conclusion (“The Strong Case for Paid Parental Leave,” Dec. 10).

While accurately noting that different empirical studies of the observable consequences of mandated paid leave find different results, Mses. McCloskey and Rachidi treat as the root question that should be asked by those pondering the wisdom of mandated paid leave as being ‘What are the consequences of mandated paid leave?’ But this question is not the root one; the root economic question is: ‘Is there reason to believe that the market fails to provide optimal amounts of paid leave?’ That the authors never ask this question is disappointing because economic theory offers no more reason to suppose that the market undersupplies paid leave than to suppose that the market undersupplies workplace restrooms, company picnics, pension contributions, or paid holidays.

Mses. McCloskey’s and Rachidi’s failure to ask the correct root question likely explains their mistaken conclusion that mandated “paid parental leave offers more choices to parents who face difficulties balancing work with raising children.” In reality, mandated paid leave causes working-parents’ choices to be fewer. Working parents who prefer to receive as much as possible of their compensation in the form of take-home pay are robbed by mandated paid leave of the opportunity to make this choice.

Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030


Aparna Mathur once attempted to offer a market-failure explanation of why markets allegedly undersupply paid leave, but her attempt fails.