Universal Basic Income

[BananaStand]

Where does that fail?

Well, presumably, the more difficult/advanced a job is, the greater the training cost. So in that regard, heart surgeons and NASA engineers would gain the greatest benefit by working for free.

The main legal challenge to unpaid internship is that they supplant paying, taxpaying, jobs.

[wufwugy]

Well, presumably, the more difficult/advanced a job is, the greater the training cost. So in that regard, heart surgeons and NASA engineers would gain the greatest benefit by working for free.

They would?

Those are examples where the entry level would naturally be well paid.

The main legal challenge to unpaid internship is that they supplant paying, taxpaying, jobs.

Well, they don't, but yes the belief is that they do. Most voluntary markets are competitive enough, it may be that all are. In these markets, unpaid internships would not replace paying jobs.

[wufwugy]

Most voluntary markets are competitive enough, it may be that all are. In these markets, unpaid internships would not replace paying jobs.

Here's a way of looking at it.

You're job searching. You get turned down from an entry-level position you applied because your qualifications are close but not quite what the firm wants. Well, some of these qualifications the firm wants are because the firm has to pay a certain amount. If they could pay less, some of those qualifications would go away. And then you, or some others, would get interviews/jobs that literally would not have existed otherwise. Then, after a month or two of you proving yourself, your pay would raise to the level that the "higher qualifications" hiring was going to pay.

[spoonitnow]

Here's a way of looking at it.

You're job searching. You get turned down from an entry-level position you applied because your qualifications are close but not quite what the firm wants. Well, some of these qualifications the firm wants are because the firm has to pay a certain amount. If they could pay less, some of those qualifications would go away. And then you, or some others, would get interviews/jobs that literally would not have existed otherwise. Then, after a month or two of you proving yourself, your pay would raise to the level that the "higher qualifications" hiring was going to pay.

This is one of my favorite arguments against minimum wage because of how much it hurts people in the long run instead of just in the short run.

[BananaStand]

They would?

Those are examples where the entry level would naturally be well paid.

Maybe I'm misunderstanding, but I thought MMM's point was that the intern is receiving $12/hour in training value and is working for free. heart surgery training costs a lot more than $12/hour. So, a volunteer heart surgeon is very well compensated. That seems silly to me.

Where MMM's logic fails is that he assumes a paid employee does not need to be trained. If training the employee costs $12/hour, then it costs $12/hour. If you also have to pay the employee $10, then the function of that job actually costs you $22.

The logic fails further when you realize that "training" is irrelevant. We're talking about unskilled labor, which means something that can be taught in less than 3 days. What internships provide is "experience", which is different, and cannot be quantified as a cost to the employer.

Well, they don't, but yes the belief is that they do. Most voluntary markets are competitive enough, it may be that all are. In these markets, unpaid internships would not replace paying jobs.

Internships are only legal if the employer gets "no immediate advantage" by employing the intern. That's some loose language that can equate any unpaid position to slavery. of course free labor is an advantage!!

I think what it specifically refers to is a competitive advantage. In other words, if Firm A can sell it's products cheaper than Firm B because Firm A employs unpaid interns, and Firm B pays it's employees, then the unpaid positions at Firm A are illegal.

the other successful challenge to unpaid internships is that they are unfair to poor people. In order to benefit from an unpaid internship, you have to be able to afford to work for free.

[wufwugy]

Maybe I'm misunderstanding, but I thought MMM's point was that the intern is receiving $12/hour in training value and is working for free. heart surgery training costs a lot more than $12/hour. So, a volunteer heart surgeon is very well compensated. That seems silly to me.

Where MMM's logic fails is that he assumes a paid employee does not need to be trained. If training the employee costs $12/hour, then it costs $12/hour. If you also have to pay the employee $10, then the function of that job actually costs you $22.

We'll have to wait for him to clarify. I thought he envisioned a scenario where an employee could pay the employer for the position since the employee would be gaining more than the employer would. It's a neat idea and could maybe work in some very unique ways, but it wouldn't be widespread.

The logic fails further when you realize that "training" is irrelevant. We're talking about unskilled labor, which means something that can be taught in less than 3 days. What internships provide is "experience", which is different, and cannot be quantified as a cost to the employer.

No labor is truly unskilled. Knowing how to speak English is a very big labor skill, for example.

There are a lot more costs to employers of new employees than just the initial training. It takes a while to find the real cost and real benefit of the employee.

I think what it specifically refers to is a competitive advantage. In other words, if Firm A can sell it's products cheaper than Firm B because Firm A employs unpaid interns, and Firm B pays it's employees, then the unpaid positions at Firm A are illegal.

the other successful challenge to unpaid internships is that they are unfair to poor people. In order to benefit from an unpaid internship, you have to be able to afford to work for free.

I get that these have been successful legal challenges. They get the economics wrong.

People who can work for pay won't work for no pay. People who can't work for pay but still want to work tend to be poor and are those who benefit the most from being able to work briefly for no pay.

[spoonitnow]

People who can work for pay won't work for no pay. People who can't work for pay but still want to work tend to be poor and are those who benefit the most from being able to work briefly for no pay.

Bingo.

Unpaid internships are optional. Nothing should be keeping people from offering or accepting them.