Tuesday, September 29, 2015

Pure ideology: Tyler Cowen explains inequality

Discussions of income inequality typically focus on how information technology raises the return to skilled labor, or on the rise of global trade, or perhaps on the way that politics skews power toward the rich and well-connected. But there’s another fundamental driver of income inequality: the improved measurement of worker performance. As we get better at measuring who produces what, the pay gap between those who make more and those who make less grows. - Tyler Cowen
Cowen argues that we are getting "better at measuring". How has he determined this? How could we even hypothetically verify or falsify this claim? It's inescapably question-begging, because it supposes that we already have an objective measure of productivity -- that's what we necessarily appeal to if we want to insist that our accuracy in measurement, by some standard, is increasing.

This is all just a way of declaring, without argument, that capitalism's measure of productivity is justified.

His example about journalism is instructive since it's so at odds with public opinion. Cowen claims that web metrics, by measuring "how many people are reading which articles for how long, and also whether they click through to other links...allow us to measure value fairly precisely." But there's a reason why "click-bait" is a universally recognized pejorative: most people reject that measure of value! An extremely common and entirely defensible line of criticism maintains that the editorial fixation on web metrics has actually degraded journalistic productivity, forcing writers to rely on SEO techniques and marketing gimmicks at the expense of valuable journalism.

Cowen presumably would try to salvage his position by appealing to some kind of counterintuitive theory of value -- but this places him in a hilarious double bind. Now he can rely on neither evidence nor logic. Evidence seems to suggest that the way we measure value is incorrect, as demonstrated by his own example of digital journalism. And logic, of course, gives us no way to measure the accuracy of his measurement: he can only make utterly empty and definitional claims, like "The exactness...allow[s] us to measure value fairly precisely." How can anyone call this science?