Tuesday, November 11, 2008

Missing: the strange disappearance of S. J. Chapman’s theory of the hours of labour (7)

The eclipse of work in neoclassical economics, Part I

The approach to the analysis of individual labour supply that replaced Chapman's theory took no notice of the effects of technological change on fatigue or on the subjective experience of the worker. It treated labour itself as a residual of the individual's consumption preferences. According to the new orthodoxy of income-leisure choice, leisure is assumed to be a normal good. Work is something featureless that takes place in the weeds behind the billboard of consumption and disposable time. Because this commodity-leisure itself lacks any definitive quality other than not being work, work is reduced to the hollow double negative of 'not not-working'. There is no pain in this hollowed-out work, neither is there joy.

A chorus of criticism surrounds the income-leisure choice model. Spencer (2003, 2004) objected that the model ignores the qualitative dimension of both work and leisure, a dimension that was specifically addressed in the approaches of Jevons and Marshall. Philp, Slater and Harvie (2005) disputed the epistemological coherence of the model's microfoundations, concluding that, "the indifference curves which underpin labour-leisure preferences are themselves founded on axioms which have been shown to be problematic elsewhere in neoclassical economics" (p. 80). Jennings (2004) analyzed the dead metaphors that signify measurement in the labour supply model, pointing out that measurement already requires a metaphor but that unmeasurable homogenous units of labour are a metaphor for a metaphor – a catachresis (literally "wrong use"). She cited Barthes's criticism of such speech forms as foundational for mythologies that "falsely universalize by removing the historical referents of signifiers" (p. 137) and noted his warning about the disingenuous "depoliticization" inherent in such speech.


Abstract: Sidney Chapman's theory of the hours of labour, published in 1909 in The Economic Journal, was acknowledged as authoritative by the leading economists of the day. It provided important insights into the prospects for market rationality with respect to work time arrangements and hinted at a profound immanent critique of economists' excessive concern with external wealth. Chapman's theory was consigned to obscurity by mathematical analyses that reverted heedlessly to outdated and naïve assumptions about the connection between hours and output. The Sandwichman is serializing "Missing: the strange disappearance of S. J. Chapman's theory of the hours of labour" on EconoSpeak in celebration of the centenary of publication of Chapman's theory. (To download the entire article in a pdf file, click on the article title.)


reason said...

I push again my "leisure theory of value". The idea here is that what we normally call "final" consumption, is not final at all. The goods and services sold in the market place are of little value unless we have the leisure to enjoy them (often traditionally, the "leisure" could be outsourced to someone else in the family). So that the real production function would see G&S in the market place as only intermediate goods. This implies a new welfare accounting. People today are working longer mainly because
a. they have to because of debts
b. they are subject to greater risk than in the past and do not trust that they will earn the same in the future (although if this were true you would think they would save more - a paradox).

Sandwichman said...

Absolutely, reason. Adam Smith proposed a leisure theory of value in his Theory of Moral Sentiments.