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April 29, 2007

Well, Yes, Obviously...

Clearly true:

Pressure groups rightly demand legislation, but the ethical shopper, the last, uneasy link in a brutal supply chain, may do more than government ever could.

Which works better? Bureaucrats making legislation or individuals pursuing their greater personal utility by their actions?

Consumerism, more sophisticated than it is given credit for, could force the market to respond to society's changing values. There should be a watchdog and official league tables of heroes and villains, but it's also time to revive purchaser power, stifled by lack of knowledge since it marked the cards of Gap and Nike a decade ago.

Absolutely. If that individual utility is raised by knowing that the money being spent aids reaching some social goal (as defined by the individual spending the money) then great, absolutely fine. Admirable even, whether that goal is to support Jim round the corner who grows organic veg or someone in Bangladesh sewing jeans.

It's just that it's really rather odd to see this argument in The Observer. When even they argue that markets work better than regulation, have we made something of a breakthrough or is it simply a mistake on their part?

No one would lose out. Increasing the price of a £6 pair of jeans to £6.10 would double the wage of a Bangladeshi worker. The industry would shed its rogue gangmaster taint. British shoppers, especially young ones, want to be responsible and the starving hemstitcher wants a living wage, not the death of capitalism. Any job, to her, is better than none.

Again, absolutely true, but the solution perhaps is not to raise the price (although if people want to pay the extra, as evidenced by the fact that they do when offered the choice, as above, why not?) but to raise the demand for the labour, which in itself will raise the price of that labour.

Even Marxists should be able to see this one. He talked of the reserve army of the unemployed, those hovering just outside the labour market who then placed pressure on those in work to accept immiserating wages because, if they didn't, they would be swapped for someone in that army who would.

The solution therefore is to buy more of such products, requiring the hiring of more labour and the diminishment of that reserve army. Labour income will then naturally rise as the capitalists compete with each other for access to that labour.

As has been happening in China in recent years, where manufacturing wages have been rising by 14% per year, year on year, for a decade.

That is what we want isn't it? That the poor become richer? Excellent, just get out there and keep buying the products of the Third World sweatshops, we know it works.

April 29, 2007 in Economics | Permalink

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Comments

It said in The Times yesterday that War On Want had said exactly that - the best thing you can do for people in these sweatshops is buy cheap jeans.

Posted by: Mark Wadsworth | Apr 29, 2007 3:34:44 PM