Tuesday, 29 November 2011

Blue law Bob Frank

Tyler Cowen posts an email from Robert Frank on Black Friday and shopping. One critical bit:
But the arms race that’s led to longer store hours poses a more serious problem for employees, many of whom had little choice but to truncate their holiday time with family and friends. I had a recent conversation about this issue with a friend in Ithaca who owns a wine store. Traditionally, New York State wine merchants were not allowed to do business on Sundays. But last year that restriction was repealed, and I asked my friend how the change had affected him. His overall sales were about the same, he told me. The change had thus been a clear negative from his perspective, since it meant that he and his wife were no longer able to spend Sundays together with their children. The upside was that customers who lacked the foresight to shop in advance for their Sunday wine needs could now be accommodated. If we’re willing to discount the cost of an inconvenience suffered by those who could easily have avoided it, the costs in this case seem clearly to outweigh the benefits.
Emphasis added.

The world of Sunday closing laws and limited shop hours didn't just impose minor inconvenience. They made two-earner families far more impracticable; Bruce Yandle found female labour force participation reduced support for blue laws. They also privileged small inefficient merchants over larger, lower cost retailers. And recall that a pretty big chunk of observed productivity gains from the 90s came from Wal-Mart.

I'm more than happy to count the disutility felt by shopkeepers and their employees when hours are longer. But putting a thumb on the scales by assuming away the inconvenience imposed on customers takes Frank outside of the economic framework for welfare analysis.

No comments:

Post a comment