dmcanzi@watdcsu.UUCP (David Canzi) (10/19/85)
In article <2663@watcgl.UUCP> jchapman@watcgl.UUCP (john chapman) writes, in response to somebody's statement that increased shoe prices due to quotas cost $5703 per job created: >A *much* lower figure than was originally quoted, by the way. I don't recall having seen any larger estimates of the cost of creating jobs via shoe quotas. John may be referring to the $83,000 figure I've quoted in some of my articles. But that was not about *shoe* quotas, it was about *textile* quotas. Or I may have simply missed the article quoting a larger figure for shoe quotas. While we're at it, let's keep our figures straight. In a recent article in the KW Record, Jean-Guy Maheu, president of the Canadian Shoe Manufacturers Association, was quoted as saying that shoe quotas cost Canadian consumers $85,000,000 to support 20,000 jobs in the shoe industry. This works out to $4,250 per job. The following little story is not meant to be an argument for or against quotas but a statement about how easily research can be slanted to support some special interest, and how easily we can be fooled. Let's consider what would happen if Rubik's-cube import quotas were imposed. By placing a limit on the number of cubes that can be imported, assuming that the demand for cubes remains the same, more Canadian-made cubes will be bought. At the same time, fewer foreign-made cubes are bought. The increase in sales of Canadian cubes results in more jobs in the Canadian cube industry. Similarly, the reduced sales of foreign-made cubes result in jobs being lost in the foreign cube industry. The retail cost of both foreign and domestic cubes increases (I'll explain why in another message), and as a result, people who buy cubes have that much less money to spend on other things. As a result they pass up one or two other things they might otherwise have bought, so a few jobs are lost in some totally unrelated industries. Meanwhile, overseas, former cube industry employees go looking for work. They can only find jobs if the demand for goods produced by some other industry can be increased. Suppose some industries manage to do so by, say, lowering their prices. This can bring them into competition with some the industry of other countries, possibly including Canada, resulting in loss of jobs there. Et cetera. The effect of cube quotas ripples through the world economy, but the end result is that some jobs are created in Canada, some jobs are lost in Canada, some foreign jobs are created, some foreign jobs are lost. After a few years, the CCMA (Canadian Cube Manufacturers Association) and the CFFT (Canadians For Free Trade), both of whom are *obviously* disinterested and impartial, as you can tell just from their names, undertake to fund studies on the effects of cube quotas. The CCMA divides the total cost of cube quotas to the consumers by the number of jobs created in the Canadian cube industry. They estimate that it costs $20.48 per job created. Everybody who reads their report feels that it accurately sums up the situation, and that cube quotas should be kept. The CFFT, on the other hand, attempts to follow the effects of cube quotas throughout the world economy to estimate the number of Canadian jobs created both directly and indirectly, and the number of Canadian jobs destroyed. They then divide the cost by the *net* number of Canadian jobs created, and estimate that it costs $41,943.04 per job created. Everybody who reads their report feels that it accurately sums up the situation, and that cube quotas should be eliminated. One or both of these groups has carefully selected the information it would take into account in its calculations, in order to produce the conclusions most supportive of its position. Moral: Let the reader beware. -- David Canzi There are too many thick books about thin subjects.
jchapman@watcgl.UUCP (john chapman) (10/21/85)
> In article <2663@watcgl.UUCP> jchapman@watcgl.UUCP (john chapman) writes, > in response to somebody's statement that increased shoe prices due to > quotas cost $5703 per job created: > > >A *much* lower figure than was originally quoted, by the way. > > I don't recall having seen any larger estimates of the cost of creating > jobs via shoe quotas. John may be referring to the $83,000 figure I've > quoted in some of my articles. But that was not about *shoe* quotas, > it was about *textile* quotas. Or I may have simply missed the article My apologies - I misremembered your figure as being for the show industry.