Remembering Gary Becker

Blogging has been very light recently as the Department has been kept administratively busy, and I'm late to commenting on Gary Becker, who passed away recently.

Like any economist, I have long know of Becker's work, but my own research hasn't taken me in the same directions, and so I have not engaged with it directly, and therefore not competent to write a Eulogy. But I would like to relate one anecdote. Back in the mid-1990s, I attended the ASSA meetings in (I think) Chicago, where there was a session on race involving three Nobelists: Lucas, Friedman, and Becker. Friedman was ill, unfortunately, and so could not attend, and Lucas chose to talk about growth rather than race. Becker's talk, in contrast, was engaging, and surprisingly (to me, based on reputation) very un-ideological and fully recognising both the power and the limitations of theory for thinking about ideas. But, it was a throwaway line that I remember the most. Apparently, when he went to publish his thesis on the economics of discrimination, the working title was Price and Prejudice, but he was persuaded by his editors to go with the more prosaic, The Economics of Discrimination. Darn editors. Fortunately, Greg Clark, has more reasonable editors. 

Why not Becker?

I think Becker's model of the family is just a little more generalizable than Erin Fletcher suggests:

Much of the dominant thinking in family and household economics has roots in Gary Becker’s A Treatise on the Family. It rests on ideas that can only politely be called antiquated. Women are in charge of domestic production (cleaning, child-rearing, cooking, laundry, etc) and men are in charge of bringing home the bacon. It’s specialization at the household level. Very economist-y. On some level, it probably made a lot of sense to think about marriage in this manner, particularly when women’s wages were much, much lower than men’s. In fact, it made so much sense that it partly earned Becker a Nobel Prize in Economics.

At some point during my fourth year of graduate school, I ordered my own copy. It was a simple (though really expensive!) purchase. A paperback, just a book, but a book that essentially formed much of the dominant thinking in my field. Even then, I knew its time in the spotlight was waning. I’ve still never read the whole thing. Despite knowing it was a classic, I can still only look up passages when I think they’re relevant. Reading more than a few pages makes the feminist in me absolutely boil.

Surely all you need is that one of the partners has a comparative advantage in domestic production. Ignore the husband/wife framing; it's an artefact of its time. But note too that biology weights things: maternity necessarily imposes a larger burden on female workplace production than does paternity. And, where couples' skills are similar and both weighted towards production outside of the home, we get outsourcing.

And this is where the Brooklyn jerky specialist comes in. He's actually making a product that homemakers once made themselves. We've become so much more productive in our specialized roles in the workforce that we can't afford the time to make our own jerky. That is, we've become specialists at making things that aren't beef jerky. And that provides the opportunity for a whole new industry to thrive — the all-natural jerky specialist.

I can't see any of this as being inconsistent with the broad Becker framework. When parameters change, outcomes change.

Alas, New Zealand suffers here: high minimum wages and little recourse to illegal immigrants makes outsourcing of a lot of domestic services available only to folks much higher up the income ladder.

I wonder how much of New Zealand's lower productivity is due to the relative cost of these complementary inputs to high ability folks' labour. Shifting to capital instead doesn't much help given the typical NZ price shock: The Roomba 530 sells for $500 NZ = $420 US; Buy.com has it for $290. Dry cleaning is unbelievably expensive relative to the States.

I suppose there's fodder for a future honours project: compare household time use surveys for professionals in the US and NZ to see how much household production wastes Kiwis' time, figure out how much of it is substitution away from labour and how much is forgone leisure, and quantify the loss in GDP relative to a world in which Kiwi professionals had access to comparably priced complementary labour or capital substitutes for household production.

Here's Becker's Treatise. Or, what bits of it are available from Google Books.