Abstract
The economic and moral defense of sweatshops given by Powell and Zwolinski (J Bus Ethics 107:449–472, 2012) has been criticized in two recent papers. Coakley and Kates (J Bus Ethics 117:553–558, 2013) focus on putative weaknesses in the logic of Powell’s and Zwolinski’s argument. Preiss (Bus Ethics Quart 24(1):55–82, 2014) argues that, even granting the validity of their economic argument, Powell’s and Zwolinski’s defense is without force when viewed from a Kantian republican viewpoint. We are concerned that sweatshop critics have misinterpreted the economic literature and overstated the conclusions that follow from their ethical premises. We show that the best understanding of the current economic literature supports Powell’s and Zwolinski’s conclusions about the negative effects of sweatshop wage regulation, and that it is unreasonable to reject economic analysis in moral argument against sweatshops even from a Kantian perspective. Additionally, we defend the theory of exploitation as unfairness given by Wertheimer (Exploitation, 1996), and show how economic analysis can be applied to that theory to identify cases of sweatshop exploitation.
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Notes
(Coakley and Kates 2013, p. 554) We have relabeled the premises and conclusion.
We use quotation marks to highlight that Preiss is presenting his view of what neoclassical economic analysis says about the arguments of sweatshop critics. On our view, the case for or against sweatshops is always an ethical one, hopefully one aided by careful economic analysis.
Preiss takes these headings in a different order in his paper.
Preiss also discusses the concept of autonomy under the “exploitation and background injustice” heading. For expository convenience we treat all of Preiss’s autonomy discussions in one place.
Zwolinski is explicit that, for the purposes of his paper, he is attempting to rely only on the “general concept of autonomy.” (Zwolinski 2007, p. 716n7 (italics in the original))
We hope this bit of irony makes clear that economists need not be “willfully obtuse” over matters of distribution, even if the “economic case” itself were so.
We will stake out a different position below.
Preiss also cites the exploitation theory of Steiner (1984). This theory of exploitation draws to some degree upon Steiner’s theory that all rights are property rights, a seemingly incompatible foundation from the other two, Kantian, theories. Because Preiss expresses Kantian sympathies, for reasons of space we restrict our attention to that framework.
However, more recently (Zwolinski 2012) argues against “structural exploitation” accounts without explicitly invoking the NWC.
Those most concerned with exploitative relationships might object to Wertheimer’s focus on exploitative transactions. Any relation, however, requires some form of interaction. We think that nothing is lost if “transaction” is understood as “interaction”.
Wertheimer (2011) contains a critical discussion of Sample’s theory. For our part, we fail to see how Sample has shown that “appropriate respect” for sweatshop workers requires more than a voluntary agreement between employee and employee at market wages. We recognize that the concept of “voluntariness” is itself hotly contested, but limitations of space preclude any comment beyond what we say here regarding Preiss’s discussion of the term.
Snyder simply names his protagonist “Debbie,” and his billionaire villain “Bill” but we want to make the contrast as stark as possible. We will also be adding another “Debbie” to the example.
Snyder’s description of Wertheimer’s theory naturally focuses on Wertheimer’s hypothetical market criterion of division, rather than our equal dollar division. This does not affect our argument.
Financial theory gives little, if any, insight into determining an appropriate risk/return ratio for a sole proprietor such as Billionaire Bill. The situation is different for the publically traded corporation, which more typically holds the place given to Billionaire Bill. See Sollars and Tuluca (2014).
There is a problem for Kantian theories to regard corporations as persons in that, at least when publically traded, corporations have a price not a dignity. See Sollars and Englander (2007, pp. 120–121) We will focus on the publicly traded corporation
For an explanation of the capital asset pricing model, see Elton et al. (2010).
In any given period, of course, a corporation might provide a return on equity below or above its risk-adjusted value; some smoothing would need to be allowed.
We ignore for now that a company’s reservation price might vary by worker, and that reservation prices may vary among workers considering the same employment.
Abbreviations
- OIC:
-
Ought implies can
- PDBE:
-
Perfect duty of beneficence to employees
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Sollars, G.G., Englander, F. Sweatshops: Economic Analysis and Exploitation as Unfairness. J Bus Ethics 149, 15–29 (2018). https://doi.org/10.1007/s10551-016-3091-0
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DOI: https://doi.org/10.1007/s10551-016-3091-0