Flutterby™! : The Value of a Worker

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The Value of a Worker

2009-03-03 18:00:45.265859+00 by Dan Lyke 2 comments

A while back, I linked to this Reason article on a World Bank report on why a worker from Mexico can come to the United States and be worth so much more. The quote I pulled was:

The rest is the result of "intangible" factors-such as the trust among people in a society, an efficient judicial system, clear property rights and effective government. All this intangible capital also boosts the productivity of labor and results in higher total wealth. In fact, the World Bank finds, "Human capital and the value of institutions (as measured by rule of law) constitute the largest share of wealth in virtually all countries."

I've gotten to wondering, though, as we see Wall Street exposed as the nest of liars and thieves that it is, how much of that "rule of law" that we thought we had was an illusion? Are we, indeed, going to continue to be more productive because we have well defined cultural rules and restrictions on what we do and don't do to each other, or were we just managing to hide our corruption and sleaze better than the Mexico politicians and business people, and we're now destined to have factories that are as productive per person as they are?

Somewhat relatedly, it also occurred to me that the "get rich quick slowly" people, from Ben Stein to Robert Kiyosaki, have been pushing the "save and reinvest" notion, where the investors who've made lots of money gambling, like Nassim Nicholas Taleb, have been quietly espousing the "bet on the odd incident that goes against the popular wisdom" direction.

Wonder what the ratio of Taleb's wealth to Kiyosaki's is. I wonder which one's happier. I have no idea what the take-away from those musings is.

[ related topics: moron Sociology Current Events Work, productivity and environment Civil Liberties Currency Gambling Economics Archival ]

comments in ascending chronological order (reverse):

#Comment Re: made: 2009-03-03 22:12:42.0339+00 by: spc476

Another one of the "get rich quick slowly" is Warren Buffet (who also never invests in an industry he doesn't understand, which is how he missed the whole Microsoft boat). I don't see him panicking or asking for a bailout. Hmmm ...

#Comment Re: made: 2009-03-04 02:42:39.480967+00 by: ebradway

The "Microsoft" boat is also known as the "Techtanic". I've always been a fan of value investing. In fact, Dan and I were talking about how the stock market undervalues intellectual property. During the tech boom in the 90s, companies like IBM and GE were undervalued compared to Amazon and Yahoo. IBM is awarded the most patents of any company every year. At one time, they owned the IP behind the leading hard drives and CPUs - and I'm not talking about 1960 - I'm talking about 1995.

And the tech world undervalues consistent profits, only rewarding growth. Microsoft isn't growing as fast as it once was but it's still far from showing losses. Once upon a time, you bought stock because it was a safe place to hold your money and you'd collect dividends.