Reflections at the Intersection of Economy & Society: NYT: Rich Man's Burden

Wednesday, May 13, 2009

NYT: Rich Man's Burden

This article points out an interesting trend in the American labor market, class relations, and inequality. FOR many American professionals, the Labor Day holiday yesterday probably wasn’t as relaxing as they had hoped. They didn’t go into the office, but they were still working. As much as they may truly have wanted to focus on time with their children, their spouses or their friends, they were unable to turn off their BlackBerrys, their laptops and their work-oriented brains.

Americans working on holidays is not a new phenomenon: we have long been an industrious folk. A hundred years ago the German sociologist Max Weber described what he called the Protestant ethic. This was a religious imperative to work hard, spend little and find a calling in order to achieve spiritual assurance that one is among the saved.

Weber claimed that this ethic could be found in its most highly evolved form in the United States, where it was embodied by aphorisms like Ben Franklin’s “Industry gives comfort and plenty and respect.” The Protestant ethic is so deeply engrained in our culture you don’t need to be Protestant to embody it. You don’t even need to be religious.

But what’s different from Weber’s era is that it is now the rich who are the most stressed out and the most likely to be working the most. Perhaps for the first time since we’ve kept track of such things, higher-income folks work more hours than lower-wage earners do. Since 1980, the number of men in the bottom fifth of the income ladder who work long hours (over 49 hours per week) has dropped by half, according to a study by the economists Peter Kuhn and Fernando Lozano. But among the top fifth of earners, long weeks have increased by 80 percent.

This is a stunning moment in economic history: At one time we worked hard so that someday we (or our children) wouldn’t have to. Today, the more we earn, the more we work, since the opportunity cost of not working is all the greater (and since the higher we go, the more relatively deprived we feel)...read more.

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Economy & Society Quotes:

"The central characteristic of agents is not that they reason poorly but that they often act intuitively. And the behavior of these agents is not guided by what they are able to compute, but by what they happen to see at a particular moment." -Daniel Kahneman

"The problem is a lot of what is called economics is not economics. It is more ideology or religion." - Joseph Stiglitz

"Formal rules are an important part of the institutional framework but only a part. To work effectively they must be complemented by informal constraints (conventions, norms of behavior) that supplement them and reduce enforcement costs." -Douglas North

"The science called 'economics' is based on an initial act of abstraction that consists in dissociating a particular category of practices, or a particular dimension of all practice, from the social order in which all human practice is immersed." -Pierre Bourdieu

"Rational economic man, in the narrow mainstream sense, is close to being a social moron. The inability to think about other people is not a proof of reason - it's the absence of reason." -Amartya Sen

"It is not the consciousness of men that determines their being, but, on the contrary, their social being that determines their consciousness." -Karl Marx

"Actors do not behave or decide as atoms outside a social context, nor do they adhere slavishly to a script written for them by the particular intersection of social categories that they happen to occupy. Their attempts at purposive action are instead embedded in concrete, ongoing systems of social relations." -Mark Granovetter

"Once a transaction has been made, in which the principal satisfies interests of the agent (for example, through a monetary payment) in return for the agent's using his actions to pursue the principal's interests, a social system has been created." -James Coleman

"Given the fact that economists and sociologists each hold half of the truth, so to speak, when it comes to markets, it seems natural that they should try to coordinate their efforts. Economists need to better understand the role of the social relations in the market, and sociologists need to better understand how prices are formed and what effect these have on the economy." -Richard Swedberg

"My aim is to integrate a focus on social relations and institutions into a modern sociological approach to the study of economic behavior by highlighting the mechanisms that regulate the manner in which formal elements of institutional structures in combination with informal social organization and networks and norms facilitate, motivate, and govern economic action." -Victor Nee

“But this long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is long past the ocean is flat again.” -John Maynard Keynes

"The more people accept the neoclassical paradigm as a guide for their behavior, the more their ability to sustain a market economy is undermined." -Amitai Etzioni

"The great bulk of controls over social behavior are not external but built into the relationships themselves." -George Homans

"While economics is about how people make choice, sociology is about how they don't have any choice to make." -Bertrand Russell

"It is difficult to get a man to understand something, when his salary depends upon his not understanding it." -Upton Sinclair

"It takes centuries of culture to produce a utilitarian such as John Stuart Mill." -Henri Bergson

"The contract is not sufficient by itself, but is only possible because of the regulation of contracts, which is social in origin." -Emile Durkheim

"The care for external goods should only lie on the shoulders of the ’saint like a light cloak, which can be thrown aside at any moment.’ But fate decreed that the cloak should become an iron cage.” -Max Weber

"A hardhitting economic sociology would attempt to draw on the best of sociology and economics, and to unite interests and social relations in one and the same analysis. Interests, in all brevity, are always socially defined, and they can only be realized through social relations." -Richard Swedberg

"As economic sociology moves beyond the earlier embeddedness perspective, the challenge is to specify and explicate the social mechanisms determining the relationship between the informal social organization of close-knit groups and the formal rules of institutional structures monitored and enforced by organizations and states." -Victor Nee

"I had stumbled on one of the fundamental truths of economics that no one in graduate school had ever told me about: If you want markets to expand, you need governments to do the same." -Dani Rodrik

"When the facts change, I change my opinion. What do you do, sir?" -John Maynard Keynes

"The difference between the most dissimilar characters, between a philosopher and a common street porter seems to arise not so much from nature, as from habit, custom, and education." -Adam Smith

“The businessman is only tolerable so long as his gains can be held to bear some relation to what, roughly and in some sense, his activities have contributed to society.” -John Maynard Keynes

"Markets are most developed and most effective in generating wealth when they are backed by solid governmental institutions. Markets and states are complements, not substitutes, as simplistic economic accounts would often have it." -Dani Rodrik

"Social relations, rather than institutional arrangements or generalized morality (e.g. shared beliefs and norms), are mainly responsible for the production of trust in economic life." -Mark Granovetter

"The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist." -John Maynard Keynes

Wednesday, May 13, 2009

NYT: Rich Man's Burden

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