Letters to the Editor: Incentive Pay and Joblessness
Inventing economic theories in an ivory tower is no substitute for living with the harsh reality of unemployment. Your Dec. 26 page-one article "Jobless Puzzle" described a trendy theory among academicians that the roots of unemployment lie in the "efficiency-wage" problem: unemployment persists because employers are paying artificially high wages in order to motivate workers to greater productivity. This prevents workers who are willing to work at a lower wage from finding jobs.</br></br>My experience indicates otherwise. I lived in a low-income ghetto and there had a string of housemates who were unemployed when they moved in, yet healthy, young and clearly in possession of employable skills. Without exception, these men failed to follow up on job leads I gave them, they walked past help-wanted signs every day, they even refused my offer to pay them generously for household chores. They chose instead to borrow from friends during the times that their government checks for unemployment and disability (it was a fraud) fell short of their needs.</br></br>This experience was a limited one yet I believe representative of a far broader problem. The men I lived with chose unemployment because it presented them with an economically desirable alternative to a life of work. Theirs was a low standard of living yet one they had grown accustomed to and complacent with. The professors studying unemployment would be wise to temper their fancy equations with some real-world experiences like these.</br></br>J. TURNER JOHNSON</br></br>Menlo Park, Calif.