Greg Mankiw vs the Division of Labor

A blog about business and economics.
Aug. 8 2013 12:15 PM

Greg Mankiw vs the Division of Labor

Gregory Mankiw's essay on political philosophy, "Defending the One Percent" does not really offer any arguments that would be unfamiliar to someone who's taken an introduction to political philosophy class and read Robert Nozick's Anarchy, State, and Utopia but it does offer an illustration of an important economic point. At the end of the essay comes an acknowledgments section:

I am grateful to David Autor, Nathaniel Hilger, Chang-Tai Hseih, Steven Kaplan, Ulrike Malmendier, Deborah Mankiw, Nicholas Mankiw, Lisa Mogilanski, Alexander Sareyan, Lawrence Summers, Timothy Taylor, Jane Tufts, and Matthew Weinzierl for helpful comments and discussion.
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The people on this list are all economics professors with the exception of Mankiw's wife, the editor of his textbook, and a libertarian-minded undergraduate economics major. And this I think goes a long way to explaining why the paper is so bad. I don't recognize every name on that list, but it contains a lot of very smart people. And yet the way the world works is that people of all levels of ability are generally more productive and effective when they're able to take advantage of the division of labor. A philosophy professor—even a desperately mediocre one—would have been able to point out that the thought experiment presented in Mankiw's second paragraph is identical to one in Nozick and that there should be a citation. Such a person would have been able to direct Mankiw toward the extensive literature that already exists on this point so that his essay could consider it.

Similarly, in his brief discussion of John Rawls, Mankiw describes the "difference principle" arising from the veil of ignorance as being grounded in psychological risk-aversion. That is certainly how I interpreted it when I first read the text, but because I read it in the context of a class on the subject the professor was able to point out to me that Rawls always denied this was the correct interpretation and there is an extensive literature here as well.

Redoing all this work for yourself without any help is really hard. And asking your closest associates from the field you work in already to help you out isn't necessarily going to be a big help. What you need to do is ask some people who are specialists in a different field. Conveniently, at Harvard where Mankiw teaches they have a whole philosophy department full of people who you can discuss these issues with. Thomas Scanlon probably has the most relevant specialization, but there's also Christine Korsgaard and no doubt others who I don't recall from my undergraduate days. In fact back when I was a student it was even possible to discuss Nozick's ideas directly with Nozick himself, who had actually retreated considerably from the Mankiw/ASU view to something more like Milton Friedman's utilitarian vision of classical liberalism.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.