Government Sponsored Jobs Program

You understand you would have to tax that right? Unless you want to print it and cause mass inflation...

 

This might actually work if it wasn't for the fact that all this money would just go straight to China.

 

How would it be worth hyper inflation?

 

What information does the government need?

 

It would need to understand the countless different firm organisation methods; it would need to understand all training needs at the firm level; it would need to minimise asymmetric information (so that individual firms do not take advantage of any subsidies); it would need to ensure that no perverse incentives are created (such as a shift towards demand for less skilled labour). A difficult business!

 

The agency lets the business decide how to organize the worker in the business, surely they can do it.

The business could provide what kinds of education they want, which they surely know how do to.

um... explain, "asymmetric information" to me it means "the absence of symmetry in information"... which doesn't make a lot of sense to me (remember that your current audience, me, doesn't have a lot of economic education.

Well less skilled labor is better then no skilled labor. Where does a manufacturing job fall on your measure of skilled labor? Because I might direct this towards that that and other industries involved in production.

 

Round pegs in square holes. Better to let the holes seek out the pegs.

Think about negotiating with your doctor what treatment is best. You have no clue, he could tell you basically anything within reason and you'd take his word for it. Or in a purchase for something you have no idea the value of. In both cases you come to the bargaining table with a huge disadvantage.

The point is you don't want to encourage the private sector to create low skill, menial jobs for a huge number of reasons. Better to skew that towards high skill jobs (which was a goal we had subsidizing tuition), as those types of jobs create subordinate positions so it's more efficient and has a greater impact on employment.

 

You're saying that the worker might not have the right skills to fit the business, well for where I want to take this plan, it's manufacturing. according to Reiver, that requires education, which my plan could provide. If the worker doesn't have the skills to do a job, then they will fail early on in the education process and be efficiently weeded out for another worker to hopefully do a better job.

Also, if the worker is a round peg, he or she won't produce much and will have to leave the job.

Also again, I have a new idea. The business can have the ability to requisition a new recruited worker to take that job if they don't like the results of the old worker. That way businesses will weed out bad workers so they can get someone who produces more.

That solve the problem?

So how would government or business go into the bargaining table with a huge disadvantage?

Well as I said, manufacturing requires a reasonable amount of education/skill according to Reiver

Also, liked for reasonable criticism and speedy response

(I accidentally posted before proof-reading, so hopefully you didn't read this right away before I corrected it)

 

Well Professor Peabody, let's get in our time machine and rehire all the farmers who's jobs were destroyed by technology! (you might be too young for that reference)

So waste time, money, and real resources trying to fit round pegs in square holes? That's terribly wasteful, there's a reason we use the market, it's because nothing allocates resources better.

Nope.

Write your local congressman and ask him to give you an explanation of the software development life cycle or modern human resource management techniques. Please post the results.

As our economy improves, every job gets more specialized and that's not according to Reiver, it's according to Smith.

I'm not a grammar nazi. I'm also not as naive as you think as I am.

 

I got an idea on how to get around this, the agency lets businesses interview and select the workers themselves so they use their labor knowledge. It would work by having the workers be interviewed by several businesses then each business would make a top ten or so of the workers they would take for the job. Then the workers are then given to the business who want them the most, and if 2 businesses want one worker equally, the agency then gets involved. Workers who are unwanted get the lowest skill jobs.

I'm not going to do so just because someone on the internet tells me to. So you should explain it.

I really don't make negative assumptions about people based on whether or not they disagree with me, and I haven't made any negative assumptions on you, so please don't assume I'm a bad person like that.

 

Expect to maximise cost as businesses abuse the system. You're merely going to punish the poor, via tax, to help the well-off (be it business or primary sector worker). Creating an economic system that makes sense whilst avoiding perverse incentives is a decidely tricky business.

Then expect further abuse as firms find means to inappropriately subsidise firm-specific human capital.

Asymmetric information in economics is typically used to refer to two problems: hidden action (e.g. A firm who tells you one thing but does another) or hidden information (e.g. The worker who pretends he's capable of doing a job that he isn't). Those are esentially summed up as moral hazard and adverse selection.

That isnthe choice. Your policy may have good will at its core, but it is very easy to generate negative spillover effects. A skewing towards greater low skill abundance, by making low skilled production more profitable, is one possibility.

We'd typically refer to semi-skilled and skilled. However, its actually more complex than that. Some countries use more on-the-job training methods (making it difficult to distinguish between worker types). Others use upskilling methods that make skilled labour a sliding scale of advanced status

 

Still the same problem, because the core concept remains unchanged. Bad skill matches is, in my opinion a much smaller problem than the rent seeking that'd occur.

You asked how government would be at a disadvantage, it's because their ignorant. Writing a your local representative in regards to those topics would likely confirm that for you.

 

How will businesses abuse the system?

Also I explained the tax situation. The poor may see a technical increase in taxes, but they will also receive a boost in income due to the increased demand for goods from the business they work at, which increases the wages they receive because the market sets their wage.

Explain more.

How do you feel about a skew towards manufacturing and industries required for manufacturing like mining?

 

(to Wombat) Where are you at now on this plan?

 

Explain the rent seeking problem.

Explain the situation where government ignorance would come into play.

 

Have many times. Businesses would waste resources competing for handouts. Which more than likely would go to cronies rather than where they ought to.

At what are they experts besides getting elected?

That's besides the point though. The point is it's not going to reduce unemployment. The only places wage subsidization programs have worked are nothing like the US. Your just creating a poor set of incentives, encouraging companies to chase a carrot on a stick instead of doing whatever it is they should be doing.

 

If the odds of getting a worker are 1000:1, then 999 companies wasted time and money to file that paper.

Often the government charges a filing fee, 1000 times that fee far exceeds the saving that one company sees.

Concentrated benefits, diffused costs - your government at work....

 

There is no room for businesses to compete, all they can do is say they're available for the sponsored job.

Tell me why it won't work or I just can't listen to you. Why won't it reduce unemployment and what incentives am I creating?

 

All subsidy systems are characterised by abuse. Its 'free money' that promotes a change in behaviour to get your time at the trough. Its worst here too as we know that, due to information problems, there are no bureaucratic mechanisms capable of minimising these problems.

They won't see a real wage increase. They will see a tax increase which will make the system more regressive.

Training is either characterised as general (where the worker is still more productive if he re-locates to a different firm) or specific (where the worker is only more productive for the firm). Government should only actively subsidise the former as, given firms cannot construct contracts to force workers to stay, there will be under-provision. Subsidising specific training would just be an inefficient hand-out at the expense of the general population.

I'm not a fan of any skewing. The only thing a government should recognise is that there are multiple equilibria and an economy can be stuck in an inferior result characterised by too much demand for low skilled labour.

 

So they'll apply for them right? Like the HUD program I mentioned? Otherwise you're begging for cronyism.

You don't want to listen, that's why the conversation is going in ciricles.

Try reading about it, you're certainly not the first to think of this.

 

Tell me a way they will waste resources competing for them. Also yes they will apply for them, but only once per sponsored jobs handout.

Hmm... you have a point. See how I completely not listen to Reiver in the last response of my previous plan?

Well anyway the last few arguments you made are that Companies would compete and waste resources for the jobs, but that is easily countered by that being useless since the only effective thing the can do is say "yes I would like a sponsored job", another argument was that "round pegs" would find businesses, but I countered that and you abandoned that argument for some reason, and that government is ignorant so they won't bargain very well. Which I can counter with: when is the government bargaining with the businesses?

 

Same question you've already asked. Your guise is slipping again.

No, it isn't. This has been tried, it's failed for the reasons I've explained. This isn't some logical chess game where you're going to adjust some parameters and the results will suddenly sparkle. Take my advice from the last post, do some research on wage subsidization programs and then give this another go.

 

Well can't we make a progressive tax to counter your theory of it creating a regressive tax?

Well wouldn't the worker be able to find jobs at rival firms since they do mostly the same thing?

Also what's bad about being incentivized to work in one industry because that's where your educated to work in, aren't several people trained that way?

This plan is not inefficient, it doesn't net cost the economy a thing. One problem is the increased tax on an area that would hurt businesses in that area, but that is countered by the business with the subsidized worker benefiting equally as much as other business hurt, with the addition of new jobs.

 

If there is a fee, it would save others tax dollar, 1000 times. And the business owner just files in his or her free time. It might cost a little for government to file those papers, but just go back to my calculations and you will see it's minute.

 

Well you haven't answered, or maybe I missed your answer, so why don't you just repeat what businesses would do to compete for it, and how it is not worth the creation of these jobs?

What guise? I'm 18 and I want to make government policy to improve things! Even if I'm wrong why shouldn't I try just for the sake of getting better at it?