« "Nontaxpayers are Overwhelmingly Eldery" | Main | Links for 2012-04-07 »

Friday, April 06, 2012

"The Fallacy of Tuna Fish Economics"


The Fallacy of Tuna Fish Economics, by Ed B. Childs, Rossen Djagalov, and Rachel J. Sandalow-Ash, Harvard Crimson: In Economics 10 lecture last Wednesday, Professor Andrei Shleifer ’82 waxed poetic about the macroeconomic implications of tuna fish sandwiches. According to Professor Shleifer, Harvard is analogous to the U.S. government, and Harvard University Dining Services, which runs the Science Center Greenhouse Cafe, is analogous to a government agency. Since tuna fish sandwiches at the Business School, where food services are contracted out, are cheaper and better than those at the Science Center, the dining hall workers’ union is directly responsible for rising tuition costs. Thus, both universities and government should privatize or contract out as many public services as possible.

If that logic seems far-fetched, it is interesting to note that it breaks down every step of the way. To start, the Science Center sandwiches are in fact not prepared by HUDS workers, but rather are bought from an outside, private company. At the same time, the tastier and cheaper business school sandwiches are prepared by workers who belong to Unite Here Local 26, the union that represents all of Harvard’s food service workers. In fact, the business school workers earn the same wages and have better benefits than their Science Center counterparts. ...

Of all people, Professor Shleifer should know that contracting out and privatization do not always work as advertised. ...

    Posted by on Friday, April 6, 2012 at 06:05 PM in Economics | Permalink  Comments (16)


    Feed You can follow this conversation by subscribing to the comment feed for this post.