Monday, May 4, 2015

The Pope Should Stick to Theology (and not economics)

By Don Boudreaux of Cafe Hayek.
"Here’s a letter to the Washington Post:
Asserting that it’s “pure scandal” that women, on average, are paid less than men, Pope Francis demands equal-pay-for-equal-work legislation (“Pope Francis: It’s ‘pure scandal’ that women earn less than men for the same work,” April 30).
What is really pure scandal is that this man arrogantly supposes that his premier perch on the moral high ground gives him leave to pronounce on matters about which he clearly knows nothing.  Has the Pope reviewed the empirical evidence?  Apparently not, for he’d otherwise know that in the U.S., at least, the alleged pay gap almost completely disappears after adjusting for economically relevant factors such as work experience, education, and types of jobs.  (Is the Pope scandalized by the job-hazard gap - that is, by the fact that, for example, in the U.S. during the ten-year period ending in 2013, 93 percent of all workplace fatalities were suffered by men?*)
And has the Pope familiarized himself with the large body of research that warns of the great risks of negative unintended consequences from well-meaning legislation?  Because the forces of competition already oblige firms in market economies to pay women workers according to the value of their outputs, legislation requiring equal monetary pay for “equal work” is far more likely to discourage the hiring of women, or to make women’s jobs more dangerous or grueling, than it is to result in higher pay for women.
The Pope should stick to studying the mysteries of theology, for the realities of the economy seem to be beyond his grasp.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA  22030
* Compiled by me from Bureau of Labor Statistics data available here."

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