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Quotation of the Day…

Tweet [1]

… is from pages 425-426 of the late University of Washington economist Paul Heyne [2]’s insightful 2000 paper “The Morality of Labor Unions,” as this paper is reprinted in the 2008 collection of Heyne’s writings, “Are Economists Basically Immoral?” and Other Essays on Economics, Ethics, and Religion [3] (Geoffrey Brennan and A.M.C. Waterman, eds.):

Wage rates are lower in Indonesia than in the United States because workers in Indonesia are willing to accept less; they are willing to accept less because their alternative opportunities are so much poorer; their alternatives are poorer than the alternative opportunities available to American workers because the marginal productivity of workers in the United States is far higher than the corresponding productivity of Indonesian workers; and the differences in productivity at the relevant margins reflect the much greater productivity of the economic system in the United States.