CHALLENGE OF D-R

Glen C. Cain

1. Dissatisfaction with pace and progress of reform war on poverty, possible relation to Vietnam protester spirit.

2. Determination of wage rates, number employed, and resulting income distribution.

a. Theory of demand - marginal productivity theory - based on profit max. of employers

b. Theory of supply - based on theory of utility max of worker

(1) theory of investment in human capital (kind of work skill supplied)

(2) theory of labor/leisure - amount of work supplied

3. Cain means neo operators on two levels, one for empirical research but due to unity would also have identical qualitative predictions from strength of underlying hypothesis.

4. Persistent of poverty (most important to DR), failure of education and training programs, education is used as a screening device, income distribution remains as unequal as twenty years ago. If discrimination is fact labor theory fails to account for it (Marx does), roles of monopolies, unions and protected labor marks (both agree this interferes with free competition), role of psychological variables, alienation of American workers.

5. Job competition: number and type of job slots tech. determined, internal labor market. Dual labor market: (Doeringer & Piore) primary/secondary. Radical, segmented and stratified: Marxian dialectical and stresses class conflict, exploitation of poor.

6. Cain feels this is a basic criticism of ortho, Mills notes n.c. in labor guilds. Inequalities of remuneration opposite Adam Smith's principle, especially in dirtier, low jobs.

7. Public employment, wage subsidy, antidiscrimination programs, expansive macro to full employment. Pre-labor market conditions of "consciousness," workers get more dominant role in work. Ortho: disc. exogenous, ___ burden on private.

8.

9. Realism of dual market, disc. a major challenge, neo must show extent low human capital to effect.

10. Defense is statistical is historical variation of model variables, blames DR for lack of attention to supply side.

Metho and theoretical question of value judgments, too narrow question. Leisure to crime, harmony presumed just means willingness.

11. Does not begin to offer a theory of labor market that can replace neo, T&M criticisms are not substantial.

12. Idea of endogenous determination of attitudinal variables among workers, institutional dimensions of internal labor markets.

13. Helps stick out in new directions: nonwage dimension of employment, occ. promotion paths, role of psychological variables to performance, cost-benefit analyses of government intervention.
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