Posner writes:

"The steep decline of unionization in the private sector is a convincing "Darwinian" refutation of the argument one used to hear that unions actually promote efficiency."

How tidy. This account, however, ignores, for instance, the role that union leadership has had in organizing and improving the productivity of various industries. Consider the impact that John L. Lewis and the United Mine Workers had on their industry.

I would argue that it is just as fallacious to believe in the inherent efficiency of an “at-will workforce” over union workforce as it is to believe the opposite. Too many other factors, beyond union membership, determine whether an enterprise is efficient.

Now, returning to Posner’s larger point, that there is little compelling justification for tenure at just about any level of the workforce. This is persuasive enough when talking about the professoriate—a workforce with highly specialized skills and (presumably) the ability to demand automatically a living wage—but what about, say, line workers at a factory that assembles vacuums? Mightn’t we have some interest (out of a value of fairness, perhaps) to assure that these folks can band together to eke out a slightly better grade of pay, and therefore might these workers benefit from the protection of “tenure” conferred on them via union membership. Without “tenure,” of course, organizing efforts are liable to be stumped.

Reducing tenure in K-12 I think is particularly important, as is some kind of pay-scale gradation amongst teachers who perform measurably better. This is not to say that there shouldn't be some kind of tenure for teachers that a hit a certain plateau (arbitrarily, let's say, 10 solid years of measured performance), itself as an incentive.

There is no question in my mind that college tenure systems are over-done as well, but the damage done there is far more minimal since there is actually (some, not enough) competition among many colleges and some valve for the failures of tenure. With American public schools in K-12 though, if you're born into certain social classes and geography, you're pretty much locked into whatever system you're closest too. Since eliminating public education is a political impossibility (NEA, etc.), and probably not desirable anyway since the transition costs would be so massive and unpredictable, the key is in introducing elements of competition into the public system. That takes creativity from policy makers, and courage from politicians, of which there is unsurprisingly little of on either front.

I am surprised to see no treatment of the argument that tenure encourages individuals to invest in specialized skills. In what is labelled the "varieties of capitalism" literature, this is often presented as a trade-off: high levels of job protection encourage greater investment in skills and hence greater productivity especially in technical professions, yet they undermine the flexibility of the workforce

I fail to see why tenure is required in order to encourage a greater investment in skills. It seems that there would be a demand for greater productivity and compensation for greater investment would be reflected in that demand.

And, ceteris paribus, at-will employment is demonstrably more efficient than a unionized workforce.

Another cost of tenure in academics could be the decline in teaching quality. I know that this is not true for many professors, but it is obvious that there is no incentive in place for some.

"Until morale and productivity returns, the floggings will continue." Or in other words; Higher, faster, further, more, more, more with less, less, less. And Oh! by the way, don't expect any increased compensation for the efforts. Tenure, hasn't that always been one of the perks and plums of an Academic career? If used properly it can function as a device for controlling salary increases.

With respect to academic tenure, it's not clear to me that there is a need to choose one extreme or the other.

Suppose, for example, that a university hiring committee is looking to recruit someone to their faculty who is (already) at the top of their field - for example, they've won a couple Nobel prizes. Further, suppose that this person is motivated primarily by a desire to make substantial contributions to their field and they only want enough of a salary to live comfortably.

As a result, this person would accept a job offer of $200,000/year with tenure and complete freedom to do the research of their choice or they would accept a job offer of $500,000/year to be an at will employee giving up the freedom to do the research of their choice.

I would argue that the hiring committee should think carefully about whether it is really worth an extra $300,000/year to have the option of terminating this person's employment. In the case of someone with a couple Nobel prizes, it is unlikely that the university would ever want to terminate this person's employment because of the benefit the university would be deriving solely from this person's reputation.

Unlike modeling or professional sports, academic reputations are sufficiently long lasting (at least in the sciences) that the "endorsement" of the university "product" afforded by having that person as a faculty member would be likely to extend over this person's entire career.

Furthermore, it takes a while for the general public to develop an association of a particular academic faculty member with a particular university. As it is, when people think of Princeton they think of the university where Einstein spent most of his United States career. Princeton is still benefiting from Einstein's reputation years after Einstein's death.

On the other hand, if Einstein had been an at will employee and had only spent a few years at Princeton before moving on to other universities or if Princeton had terminated Einstein's employment because his productivity had declined from his younger days then Princeton would not still be benefiting from this association.

Universities are very different from other businesses in that universities last for a very long time and the demand for their product is basically constant. Most businesses simply do not have the option of offering tenure because they are likely to go out of business or at least undergo substantial restructuring on a much shorter time scale than employee careers.

Posner writes: ...the situation is no different in "knowledge" firms such as software and pharmaceutical-drug producers, which encourage their scientists to undertake high-risk projects--and do not think it necessary to offer tenure.

I would argue that it is less the case that these companies don't want to offer tenure and it is more the case that they can't. Suppose Microsoft hires an expert on computer operating systems who is 40 years old. Can Microsoft guarantee that it will still be selling computer operating systems in 25 years when the expert reaches retirement age. It might turn out that in 25 years all computing is internet based and computer operating systems are included for free with the terminals that people use to access the internet.

On the other hand, if a University hires a 40 year old expert mathematician to teach calculus and do mathematics research then they can be pretty sure they will still need someone to teach calculus in 25 years.

As to whether the private sector does "high risk" projects at the same rate as tenured faculty, the private sector may do projects that are high risk by their standards but it is not clear that they do projects that are high risk by academic standards.

Consider something like cold fusion. If anyone could ever find a way to make cold fusion work as an unlimited source of energy, it could totally change the world. It would remove much of the incentive for conflict in the Middle East (and the accompanying terrorism) and it would solve many potentially catastrophic environmental problems such as global warming.

It could even eliminate world hunger because it might then be possible to build machines that would pull carbon dioxide and nitrogen out of the air (and water and minerals out of the ground or the ocean) and produced an unlimited supply of food (at a much higher rate than plants which rely on energy from the sun to do this).

It would be nice, therefore to have some people trying truly innovative ideas to make cold fusion work. The thing is, it might very well turn out that cold fusion is impossible. At any rate, the probability of major success is extremely low.

Suppose there is a physicist at a state college who spends the fall and spring semesters teaching introductory physics and who spends the summer recess running highly innovative and speculative computations about cold fusion on his home computer. If this physicist has tenure or at least the expectation of job security then this physicist could spend every summer for twenty years working on the problem and if it all turned out not to work then it wouldn't be a big a deal.

On the other hand, if this physicist was being terminated every few years and had to move around the country from state college to state college then this physicist would either require a much higher salary or get a job in the private sector.

A state college can use tenure to attract a better physicist than they could afford to pay for with salary alone and by offering tenure they also have a chance at being an institution where a great discovery is made. If the physicist doesn't discover a cold fusion based energy source then at least the state college got to have top physicist teaching their students and in the unlikely event that the physicist does discover cold fusion then the state college gets to claim that they were were the place where cold fusion was discovered.

Basically, when it comes to tenure of academic scientists, I would advocate leaving tenure to the free market. Universities should feel feel free to offer whatever incentives they have available (including tenure) to attract top scientists. Scientists should be free to accept the most attractive job offers taking into account whether a particular job offers the freedom to pursue highly innovative research without risking to their careers.

Now, in a free market universities chose to be like the airline companies and drastically vary prices/salaries/length of employment from moment to moment based on whatever is in their interest at the time. The problem is that this behavior totally destroys customer loyalty and goodwill and causes customers to focus only on the lowest prices.

In the long run this hurts the institution. As soon as airline customers started finding out the the guy in the seat next to them payed hundreds of dollars less for the same ticket, they started to focus only on price with the consequence that airlines have to compete aggressively on price and are often on the verge of going bankrupt.

If Universities choose to be like airline and create a moment to moment culture then the academic job market may start looking a lot like the professional sports and entertainment job markets. Universities will have to compete only on salary for the top faculty and will, as a result, be paying the top faculty multi-million dollar salaries for a few years after which the top faculty will retire and spend the rest of their lives in early retirement.

In the public sector, most employees below the top political level have extensive job protection (including teachers), except in the military and other national-security employment, such as the CIA.

Not to go off topic here, but I don't object that much to job security for government employees but I do object strongly to government pensions and other benefits - particularly the large pensions and benefits offered to the military.

It is completely lacking in integrity for one generation to generate debts to be payed off by future generations. If the current generation wants a war then they should pay for it up front including the pensions and medical benefits for military personnel. One generation should not be allowed to make promises on behalf of future generations to pay pensions and medical benefits.

Basically, government employees should be payed a straight salary and if the employee then wants to invest some of that salary in a private pension or private long term health care plan then they can do it on their own.

In some fields, such as mathematics, there is generally a significant falling off in academic output at a young age,...

Not having seen the studies, it is impossible to comment on this directly.

Suppose, however, that universities had a policy of hiring people who had recently been struck by lightening and a study was done to compare the rate of lightning strikes on university faculty before they were hired and after they were hired. One would find a dramatically lower rate of lightning strikes on the faculty after they were hired relative to before they were hired but this would not indicate that being hired by a university protects against lightening strikes.

Essentially, people who make major mathematical discoveries at a young age are likely to pursue careers in mathematics but people who don't often go into other careers and give up on mathematics so they don't make the discoveries later in life that they would have made had they been hired as mathematicians.

Only in a world where universities hired people to be mathematicians without any regard for their output early in their careers would it be possible to do a direct statistical analysis of productivity with age.

Three thoughts are below.

1. Availability bias: Sure, employees are employed at-will. However, how an organization treats an employee during his\her final days at an organization, even a true "loser" employee, will have a disproportionately large influence on how the (former) employee remembers the organization and his experience. Treating "losers" rudely at the end of the contest happens all the time in the workplace. Companies go under because of it. It is somewhat like poor sportsmanship and ungracious winners on tv.

----------------------------------------------

two:

"additional motivation may be provided by a tournament-style promotion system."

Real wages in IL may be down because the tournament is broken in chicago and IL - not sure. People with money, the right friends, the right age, and the common lifestyle (married, kids) get jobs and unconventional or different people do not. Given this realization that the game is rigged, or even the realization that the probability of game-rigging has increased: people will not bother to enter the tournament. To do so would be stupid and a waste of time. People will leave. You will have an adverse selection problem: "winners" will be dolts.
---------------------------------------------

three:

"The greater cost of tenure is simply in forcing retention of inferior employees."

Yeah, and at some point, is this so bad in all instances? If you force out some 40-year-old inferior person, where does he go? Does he live off social services provided by the superior person's wages that are donated to a church or parish? At some point, there may be an idea of "insurance" behind tenure and protecting weaker employees. As long as this insurance is not excessive, I do not see how it is so bad.

Much more dangerous is the dolt who wins a rigged or incomplete tournament.

One more: It may be hard to take an absolute position on tenure at all points in time. It seems that trends toward more tenure may be smart during certain time periods, and less smart during other periods. The answer may be "it depends".

One might try to argue that a minimalist tenure system, vs. no tenure system, can lead to more stability. Given stability, people and society may be more likely to invest relatively larger amounts.

The variety within the U.S. by state is interesting and valuable. Some states are more unionized (protect jobs - somewhat like tenure?). Other states are more right-to-work (no unions). Would we want to make it all one way or the other? Probably not. Some people thrive in one type of state, and others thrive in another. This may change during different parts of a person's life. Different types of states may provide diversification of outcomes and lower the riskiness of a society. We may get better risk-adjusted returns given a little bit of everything in the U.S.

wes,

Einstein didn't work at Princeton University. He worked at the Institute for Advanced Study, located in Princeton, NJ.

Einstein didn't work at Princeton University.

Oops. I was wondering whether I should fact check that before I used it as an example.

According to the Seeley G. Mudd Library at Princeton
http://www.princeton.edu/mudd/news/faq/topics/einstein.shtml

While an important member of the larger intellectual community of Princeton, Einstein was not a member of the Princeton University faculty although he did have an office on campus.

Then again, according to:
http://nobelprize.org/physics/laureates/1921/einstein-bio.html

He became a German citizen in 1914 and remained in Berlin until 1933 when he renounced his citizenship for political reasons and emigrated to America to take the position of Professor of Theoretical Physics at Princeton*

With the foot note that

*Albert Einstein was formally associated with the Institute for Advanced Study located in Princeton, New Jersey.

Well, at least I didn't use Linus Pauling and Cal. Tech. as an example. According to:
http://lpi.oregonstate.edu/lpbio/lpbio2.html

In 1964 Linus Pauling left his tenured professorship at Caltech because of pressure from administrators and conservative trustees who disapproved of his prominent, persistent antinuclear and international peace-promoting activities. Pauling had been at the Institute for 42 years - first as a graduate student, then as a faculty member. (In 1937 he was appointed Chairman of its Division of Chemistry and Chemical Engineering and Director of the Gates and Crellin Laboratories' positions that he had abdicated in 1958 under administrative pressure.)

N.E. Hatfield writes:
If used properly it [tenure] can function as a device for controlling salary increases.
Mmm, perhaps, but I am dubious, because I believe such an exchange leads to lower productivity and hence greater costs to the organization. Having watched the university employment game from an early age, I am convinced that tenure is/was first and foremost a security device for protection against "worry," chiefly the worry from arbitrary discharge for any reason, not merely political, but generally not economic. [Tenure did afford some measure of protection against purely economic layoffs, but only if there were untenured folks behind you.] Otherwise, it was truly a "resting" point. That is not to say that many tenured professors do not work hard after achieving tenure. Many do, but they continue to provide value and receive it as well for their labors, either in increased recognition, continued promotions, sabbaticals, paid speaking, etc. Those for whom tenure is a substitue for salary increases are likely to repay that "ceiling" with reduced productivity. I think we see that all around, notwithstanding the occasional--perhaps apocryphal in the case of the UMW and John L. Lewis--exception. Just my $.02.

Could Josh or anyone else here please cite and comment on the research that proves "ceteris paribus, at-will employment is demonstrably more efficient than a unionized workforce?"

I'm curious, since if this were well established by a number of studies, why would Posner have to cite the decline of unions in recent years as "a 'Darwinian' refutation of the argument that labor improves efficiency?" I mean, couldn't Posner have just cited the research itself?

Thanks in advance for helping out this non-economist.

From a theoretical perspective, unions raise wages above market clearing prices which increases the unemployment rate - there is an obvious dead weight loss. Think of it in terms of opportunity cost: if an elevator mechanic can add 1 dollar of value per hour but a union contract requires him to be paid 2 dollars an hour, he will not be hired and will be forced to accept a job where his value added is presumably less. In short, unions allocate resources inefficently.

In my view, academic tenure remains a necessary safeguard against suppressing and punishing unpopular ideas. I'm not convinced that Judge Posner's proposal for replacing tenure with contractual protections - i.e., make politics an impermissible ground for termination - would work in practice.

Assuming that contractual provisions could adequately cover all of the independent thought protected by tenure, there remains the problem of pretextual discharges and demotions. I suspect that numerous firings in academia, as in other employment contexts, are cloak-and-dagger affairs. Moreover, there is a heightened risk of politically-motivated pretextual retaliation in fields where performance measures are more susceptible to subjective factors - e.g., fields in which journals accept and reject papers based not only on analytical quality but also on viewpoint (expressed in the paper, or otherwise known to be held by the author). Since many of the most subjective academic fields are also among the most politically charged - sociology, law, political science - politically-motivated pretextual retaliation would be an even bigger problem than it already is (e.g., to non-tenured faculty) if the tenure system were abolished.

Contractual employment rights are only valuable to the extent that they can be enforced ? including against violations based on pretext. Many employment rights, for example against race-based animus, are valuable and enforceable in large part because they enjoy a highly supportive legal environment (extensive statutory protection, heightened standards of judicial scrutiny, sympathetic courts). Would professors who are unpopular for challenging politically correct taboos receive a similar level of legal protection?

As shown by the recent excoriation of Harvard president Larry Summers over his comments on women in science, these are very real concerns. If unpopularity can bring a Harvard president to his knees, imagine what it could do to less powerful professors.

Thanks, Josh. I don't mean to loose sight of the rest of the conversation by pressing what must seem to most people here to be a settled point; nonetheless, I still can’t help but wonder if there are any studies that demonstrate that union workforces are inherently less efficient than non-union ones.

Certainly we have evidence of an anecdotal sort (e.g. unions must be less efficient because the market has all but done away them, with unions representing a mere 8% of the workforce); certainly we have theoretical explanations, too. Maybe together these are compelling and do the job. But I can’t help but think not. There’s simply too much inefficiency in every workforce, no matter what kind of productivity gains they say are driving the economy (or it least it seems to be so, to me, from my little cubicle).

So how about it? Can you cite so research for me to look into on this?

There is a lot to say in response, but I will limit myself to two comments.

First, I find it distressing that Judge Posner does not realize the destructive potential of politicizing the entire civil service. Certain elected officials, who favor friendship and partisanship over competence, will fill the payroll with hacks and not only hurt productivity but create cronyism and corruption. Perhaps the civil service has been "clean" for too long that Posner has forgotten what it was like before. And, there is no reason why one's political affiliation should matter for non-supervisory civil service jobs (unless one favors cronyism or corruption). Given the scandals in today's headlines, clean government should be a command, not a suggestion.

Second, Posner evaluates the "costs" of tenure purely from the standpoint of management. What about thinking of it from the standpoint of the worker, given that most Americans are workers and only a few are managers? We should ask whether the average worker would be willing to trade the "cost" of some form of tenure (that is, slightly higher prices) for the job security it provides. I would bet that most Americans would gladly take the trade-off, if they had the option.

My suggestion would be to make it easier to fire workers for cause (e.g., incompetence, negligence, etc.) but more difficult to fire them for reasons unrelated to job performance. Workers with demonstrated competence issues should not be able to file wrongful discharge suits. But on the other hand, no good, established worker should be fired to make room for the boss's nephew.

Related observation: hasn't tenure, in whole or in part, driven up the cost of a higher education (to a degree far greater than the rate of inflation, or any other comparable indicator)?

> But the situation is no different in "knowledge" firms such as software

Computer scientists in corporate research labs once had de facto tenure. They could take big research risks (Bell Labs, Xerox PARC). Today, most corporate research is very short-sighted, incremental work because researchers have a bit less job security. If you measure a scientist's performance every year, then he has to do short-term research to show new results.

Some of Judge Posner's proposed productivity measures can have invidious outcomes. Take the proposal for measuring FBI agents (number of arrests leading to convictions, weighed by the severity of the sentence and/or property recovered).

This proposal would be a serious disincentive to agents who investigate crimes that are serious, but complex. Agents might gravitate towards a high volume of easy-to-prove convictions.

Beyond that, isn't the first duty of the FBI to ensure that justice is done? Paying agents by the length of the sentences imposed would encourage the government to always argue for the longest conceivable sentence, regardless of whether it is just.

"With their productivity continuously measurable, there is no need for job protection."

Its almost as if people haven't read history... Foremen standing behind workers and docking their pay if they talked to each other... People getting fired for no reason other than to instill fear in other workers... Crushing drudgery and constant suspicious monitoring... the late 1800s weren't pleasant, massive numbers of people found it to be horrible working under constant performance monitoring.

And now we get one of the most privileged people in the whole workforce endorsing neo-Taylorism.

I don't mean to be disrespectful but... Why should we care what a federal judge with one of the world's cushiest retirement plans and a lifetime of tenured positions says about job security. Has Posner EVER been laid off? Is he renouncing his tenure or his retirement plan? (He could, job security has helped him to get rich)

"The 80-year-old mathematician may be working hard, but he may be incapable of achieving the output of the 25-year-old mathematician who would take his place were it not for tenure."

That is exactly why people bargain, (collectively before the Right made union a bad word) for job security, to stop employers who paid them less than their marginal output in their youth from firing them in thanks.

To quote Death of a Salesman (thanks to a reminder from my employment law professor): you can't eat the fruit and throw away the peel

When people get fired for no reason, especially when they are old or sick or when childcare demands reduce their output, they don't just die. Rather they start to draw unemployment, welfare, medicaid. Given the overhead of these programs, it may cost as much or more to support people off the payroll as on. The difference? In one case it is paid out of profits, the other, out of taxes.

So in reality, drop tenure and you raise profits, but you also increase the burden on taxes. Who pays taxes these days? Corporations pay less and less, the middle class pays more. Who gets profits? Is it really so hard to see the motivation from the result? Or else you stick it into deficit spending, which is just a way of postponing payment of boomer retirement onto my generation.

Incidentally, the same effect occurs when Walmart pays people below a maintenance wage and gives no health care. People still get sick, medicaid and public emergency room costs go up. They work two jobs but still have to take welfare to pay for day care.

Dropping tenure is just an externalization of costs. Instead of the university paying for the old age of its former stars, they are fired and you and I foot the bill. Who cares you say, so long as it is efficient? Well, it is also significantly less human. Read Death of a Salesman again. Profit is not the only function of employment.

p.s. It is shifty to spend a lifetime joined in the project of disparaging unions in the public sphere and then cite the decline of unions as "darwinian evidence" that you were right. All that proves is that people like Posner and Reagan can influence public opinion.

Posner said:
"Quality of research is readily measurable by grants, prizes, and above all by citations to the professor's scholarly publications, weighted by the quality of the journal in which the citations appear."

So is the fact that I cited you in my law review note going to increase your pay or decrease it? :) Does it matter that I was disagreeing with you? I don't know if I'll get published or how my journal rates on the scale though. If you do get a bonus, I hope it is enough to buy a beer or a glass of wine on me.

Commentor said:
"Think of it in terms of opportunity cost: if an elevator mechanic can add 1 dollar of value per hour but a union contract requires him to be paid 2 dollars an hour, he will not be hired and will be forced to accept a job where his value added is presumably less. In short, unions allocate resources inefficently."

I don't want to think of it in terms of opportunity costs. If all the elevator mechanics are unionized, then the value of the elevator repair is set at the value of the union contract. The elevator in Macy's has to work! They have to pay $2. So the elevator mechanic gets an extra dollar an hour, then maybe he saves up so he can go to Macy's and buy a shirt for his daughter.

Profits at Macy's go either to management and shareholders, or to employees. The argument is about what share goes where. If you define "value" to be the minimum Macy's can get away with in the absense of collective bargaining, then you are begging the question.
If efficiency equals maximum profit in the absense of unions then you've rigged the game.

The proper economic question is, is there a deficiency in the bargaining process that makes it necessary for employees to join together in order to be on an equal footing with Macy's. Can Macy's fire people when they ask for a cost of living increase and scare everyone so much that they eventually drive wages down to $5.15 an hour? Yes. Can they do that when there is a union? Probably not. Should everyone but the overlords get paid $5.15 an hour? You decide.

You didn't tell us where you came up with $1 for the value. Was the process that set that wage fair? Were both parties represented by counsel or just one. Macy's can hire or fire one person and barely feel it, but the mechanic is desperate to feed her kids. Is that equal footing?

"Related observation: hasn't tenure, in whole or in part, driven up the cost of a higher education (to a degree far greater than the rate of inflation, or any other comparable indicator)?"

Nope. That's due to dramatic increase in salaries that university administrators' are being paid.

I am an employee of the Federal government. My salary is substantially below market rate for my profession, but I have tenure which confers job security. I have decided to trade the higher salary for security. (Individuals with my skill set receive far greater salaries than I do in the private sector, but I have seen them lose their jobs when the company no longer needs their services.) If I didn't have the security, I'd move to the private sector immediately. So, doesn't the taxpayer gain?

Michael above is correct. Every government employee I know of makes less than their private sector counterparts, but in turn enjoy greater security, a less stressful workplace, and (often) a sense that they contribute to the greater good rather than to stockbrokers and clients.

To me the great danger is a growing Wal-mart-ization/cash-dollar-value of the academy. We support tenure because often what is the most valuable in the long-term (economically and otherwise) often has no cash value in the short-term. Alan Turing developed the theoretical basis for the computer in the 30s - but it tooks decades before it could even translate into hardware (everyone at the time thought it a poor investment, as it would be too slow for calculation).

Should he have worked on it? Turing was a smart man, and no doubt could have used his math as an economics professor (as posner suggests) to do work that would have been very useful to then-current-day corporations. But we may be decades behind in computers right now if he hadn't. And if he wasn't in part protected from market forces, he may have has no incentive to not.

Demand that doesn't pay out, say for abstract computer models or literary theory, has a tough time generating supply without a push. Why not give it a push?

also - *sigh*

I have no idea what the job/class situation is for anyone here, but I love hearing lawyers, doctors, and other professional class people hate on unions: "Gee, I really hate the idea of a group of people coming together based on their profession to try and influence legislation and make it more favorable to their professional-interests."

Meanwhile....lawyers have influenced legislation making themselves indepsenible to every part of american life (allowing the ratio of lawyers to people has gone from '800 to 1' to '300 to 1' in 30 years), a month doesn't go by where doctors/big Pharma get another bill passed extenting patents or exempting mercury-based vaccines from lawsuits or etc etc, and banking industry lobbyists wrote the bill that congress passed for the bankruptcy reform bill.

Yes, I too hate it when a group of workers band together to corrupt the democratic process. I just hate it a little less when it involes things like 'living wages' and 'healthcare' and a little more where it involves rubberstamping lobbyists' wet dreams.

One thing that has not been mentioned is that, from a societal benefit standpoint, the location of individual research is unimportant as long as the results are published.

What concerns me about Judge Posner's thesis is that treatment of the historical dimension is missing. A practice whose utility fluctuates with periods of greater or lesser political upheaval should not necessarily be evaluated on the basis of a single historical "snapshot."

Also, related to the historical idea, the value of research is not necessarily easily measured because recognition of value and acceptance of new approaches by a larger research community is often not immediate. Alfred Wegener's Plate Tectonics theory is a famous example of delayed academic acceptance.

But if the emphasis is on teaching ability rather than research ability, since the metrics of good job performance are so much easier to establish, Judge Posner's argument against tenure protection seems much stronger.

Wes, two more data re Einstein:

Minor: I see that anon has already written that Einstein was not a tenured prof at Princeton University, but part of the Institute for Advanced Study, next to Princeton. More germane to this discussion, the IAS has a small permanent faculty, but most IAS scholars are on short fellowships, then out the door. (source)

Major: During Einstein's "annus mirabilis," the incredibly productive year of 1905, he was employed in a fairly low-level position in the Swiss Patent Office. He did not attain a significant academic position until 1911. (source)

During Einstein's tenure at IAS (1933-1955) he failed to bring his own research to fruition.

So Einstein is IMHO a poor example of academic-tenure-as-enabler; if anything, to me Einstein is an example of the creative benefits of wandering in the wilderness. (It's also worth noting that Einstein wrote his "annus mirabilis papers" with little access to scientific literature or peers, making his sense of wandering in the wilderness more profound. (source))

Tenure is probably not a good idea. If we cleaned out the administration at the Kellogg School of Management and got new slate of people, it might help the economic malaise in the state of Illinois. We should ship the current cast of great yet ineffective people to a less-sophisticated state.

Einstein is IMHO a poor example of academic-tenure-as-enabler

While I agree that Einstein may have been a poor example, he was intended as an example of an how long term employment of someone like Einstein is beneficial to the long term reputation of the university.

A few months ago I attended a presentation where a community college administrator said that his college was transitioning from a "sage on the stage" to a "guide on the side" model of teaching - that is, a model where the course content would be purchased from some corporation and the faculty members would merely administer the course website, click through PowerPoint presentations provided by the corporation and administer tests provided by the corporation.

In the future, academics may either have to choose between working for the corporations that provide academic content or doing government funded research.

Why should we care what a federal judge with one of the world's cushiest retirement plans and a lifetime of tenured positions says about job security. Has Posner EVER been laid off? Is he renouncing his tenure or his retirement plan? (He could, job security has helped him to get rich)

Argumentum ad hominem. Try attacking the argument.

Wes said: "Suppose, for example, that a university hiring committee is looking to recruit someone to their faculty who is (already) at the top of their field - for example, they've won a couple Nobel prizes."
Fredrick Sanger is the only living person who has won two Nobel prizes and he retired in 1985. The three others who have won two Nobel prizes are dead: John Bardeen died in 1991, Marie Curie died in 1934, Linus Pauling died in 1994.

Fredrick Sanger is the only living person who has won two Nobel prizes and he retired in 1985.

Clearly this is the result of academic tenure: once someone has demonstrated that they are capable of winning one Nobel prize then any failure to win subsequent Nobel prizes is clearly the result of academic tenure induced laziness.

I don't want to think of it in terms of opportunity costs. If all the elevator mechanics are unionized, then the value of the elevator repair is set at the value of the union contract. The elevator in Macy's has to work!

They don't have to work because the value they add is finite. In the example, their value is $1. It is only in Macy's interest to fix them if the cost of repair less than that.

Profits at Macy's go either to management and shareholders, or to employees. The argument is about what share goes where.

This is completely incorrect. If wages are forced above the productivity of some individuals then Macy's, a profit seeker, will not hire those workers. Quite apart from whether you think this is heartless, etc, it is a matter of basic logic. Please get an argument.

The proper economic question is, is there a deficiency in the bargaining process that makes it necessary for employees to join together in order to be on an equal footing with Macy's. Can Macy's fire people when they ask for a cost of living increase and scare everyone so much that they eventually drive wages down to $5.15 an hour? Yes.

Quite obviously, no. Are you saying workers at Macy's have no other work options? Not at the any of hundreds of other shops, not in another service industry, not by going back to school? Get real. True, Macy's is bigger than individuals, but it has absolutely no power to coerce individuals to select them as employers over any of thousands of alternatives. Macy's, in most if not all instances, is obviously a price taker in the labor market. Your premise is flatly wrong. Please get an argument.

Academic tenure may have perverse results in removing the incentive for continued performance. On the other hand, it is surely no more perverse than the golden parachutes, and munificent bonuses weakly related to performance, which senior management arrange for themselves in other organizations.

Which leads to the thought: Why do capable individuals accept lower-paying jobs in academia in the first place? Because of a sense of prestige (Ph.D.'s, and perhaps J.D.'s and M.D.'s too, often being inculcated with the belief that the smartest will continue in academia, while the rest are washed out and do something else). Because of a belief that they will have more freedom and control of their own work than in a business organization. Because of a desire to remain in the stimulating environment of a university campus.

These intangibles-- prestige, freedom, environment-- offer psychic compensation which partially substitutes for monetary income and persuades some to be professors when they could make more money doing something else.

Now, as a successful corporate executive enters the end-stage of his career, he naturally secures the most pleasant retirement that he can. Having been compensated primarily with money throughout his career, he arranges a golden parachute consisting of more money.

But what about an academic? His revealed preferences are less for monetary compensation and more for intangibles. His ideal retirement package would contain the prestige of continued association with a university, the freedom to continue to work on what interests him, an office on campus and the chance to continue to interact with all that the campus offers. In short, he still wants to be a professor when he retires. His preferred parachute is to stay on the plane.

So, the use of tenure as a job compensation for academics may be of a piece with the other forms of compensation that an academic is offered even in the earlier stages of his career.

The irony here is that Judge Posner is the poster child for why his theory is wrong. Life tenure has not made him "lazy" or unproductive, and without tenure, it is unlikely that he would feel free to say many of the things that he says. While, of course, Judge Posner is an exceptional person, there are many, many other tenured workers who are highly productive. I would hazard a guess that tenured professors, for instance, are no more "lazy," across the board, than nontenured workers in other professions, many of whom spend their days schmoozing or surfing the web.

Some of the theories that Judge Posner proposes would create a rather Hobbesian world. But Judge Posner's life choices prove that he has no desire to live in such a world. This, to me, speaks volumes. Perhaps this is an unfair argument -- it is not necessarily hypocritical for a libertarian to work for the government -- but I thought it is worth noting. I would be intrigued to hear his response.

Why is tenure granted by custom in most concerns, as Becker observes. For employers, there may be economic reasons for granting tenure—imagine a list here—but fairness is likely the prime motivator. My experience has always been that managers bend over backwards to treat workers fairly. Even when you are certain that firing someone is justified, it is lump in the throat, heart-poundingly difficult to do, and as a mentor of mine with a reputation for toughness once told me “If it ever gets easy, there’s something wrong with you.”
Economic libertarians are often quick to get into bed with the wingnuts who wring their hands over things like “Brokeback Mountain” getting too much press, but the coarsening of culture I worry more about is when economic analysis such as presented in this blog goes beyond analyzing and exploring the nuances of policy to advocating a point-of-view that undermines such common decency.
Fairness is hard to measure, of course, but the moral justification of laissez-faire—as we all know--is fairness: the invisible hand accretes utility as rational self-interested parties make decisions in the market place, each to further their own happiness. (Efficiency and wealth creation may be indicators of increasing utility, but they are not strict proxies.)
Posner’s preference for the operation of the ‘invisible hand’ is clear.
“Employers would like greater flexibility, but outsiders--unions or judges--impose tenure for their own reasons.”
‘Selfish’ reasons, I might add.

Tenure is codified in workplaces where workers have relatively more say in the contract process than average, where they have an opportunity to express their preferences for contract terms. Unions shops and college faculties have a seat at the table and can negotiate term. For most workers, employers dictate the terms, or negotiate them one-by-one.
Are unions exercising a special privilege? To Posner, it seems so.
In Posner’s universe, the union gets between the employer, the corporation, and the employee, the worker. The union is an outsider, an interloper, a meddler, not the worker’s representative in a bargaining process. Similarly, judges are outsiders either deciding based on ‘what they had for lunch’ or applying ill-conceived ‘laws’ designed by other ‘outsiders’ such as our representatives; judges are not seen as enforcing rights and terms of employment agreed upon by the people.
It would be odd, indeed, to privilege the choices made by the ‘invisible hand’ over the express wishes of individuals through their bargaining agents and their governments, but perhaps we know better what is in our best interests when we let others do our thinking for us?

"Argumentum ad hominem."

What, you don't think it is at all possible
that someone who has spent nearly their entire working life under tenure might underestimate the negative intangibles of living without it?

"In the example, their value is $1."

You missed the point. Whoever sets the value at $1 predetermines the outcome of the example. What if collective bargaining forces Macy's to either cut profits and pay $6 or not have elevators? Is that an inefficiency of unions or was Macy's stupid for installing elevators that didn't add enough value to pay a living wage for their upkeep. Does society need jobs that add less value than it takes to maintain an individual worker? No. Should companies be able to pay less and rely on public welfare to make up the difference? I take it since part of that comes out of your pocket you might think no.

"If wages are forced above the productivity of some individuals then Macy's, a profit seeker, will not hire those workers."

What does productivity mean? Can Macy's whip its employees to make them more productive? If Macy's puts a gun to their head and they agree to work for 10 cents an hour, did they just get more productive under the definition you are using?

Let me ask a different question. Now that airlines have beaten unions and dropped pilot wages from over $100K to sometimes less than $40K, do you feel safer in the air? Think about the amount and quality of pilot training that someone wishing to enter the field will rationally choose at each of those salary levels. Maybe there are other values (safety and professionalism) besides raw profit that influence our idea of what pilots should get paid.

"Macy's, in most if not all instances, is obviously a price taker in the labor market."

Oh, I'm so glad it is obvious to you. I imagine you work retail a lot. But yeah, you are probably right, they could go to Walmart, I hear they pay an excellent wage. I'm sure their kids won't starve as they go back to school. They can just eat cake at the many thousands of alternatives for free day care.

"Please get an argument."

Please open your eyes. The world prior to wage, hour, and tenure protections was hell on workers, even in the growing market economy of the 1880s or 1910s. Workers are rational too, if they had an alternative to working for $6 without health insurance they would take it.

Civil servants, especially in California, have morphed into a species of super-citizens with super job security, super pensions, super healthcare, and super salaries. Over time these luxuries are propelled ever upward by a one-way ratchet forbidden by law to slip back a notch.

The more super the benefits, the more super the interest in maintaining them. This creates a form of positive feedback that can get out of hand, especially when civil servants use their positions and paychecks to influence elections and benefits. Look at the finances of San Diego.

One equitable solution to this conflict of interest between voting for good government and wanting a very comfortable and secure job would be for civil servants to forfeit the right to vote in any election at the level of government where their salaries and other job benefits are determined. Federal employees would not be allowed to vote in Federal elections, state employees would not be allowed to vote in state elections and local employees would not be allowed to vote in local elections. Nor would such employees be allowed to contribute to political candidates for these elections.

This idea could be extended to any citizen who receives a check from any level of government. If you accept a government paycheck, Social Security, Medicaid, Medicare, or a farm or other business subsidy, you should forfeit your right to exercise your conflict of interest by voting for or contributing to those who determine those benefactions.

Election recusal would be a common sense bit of fairness that is already in operation in several governmental situations. Judges recuse themselves from cases where their personal financial interests are at stake. In many local governments the local representatives are supposed to recuse themselves from voting on issues where they have a personal or financial stake. A recusal from the politics of their paycheck would be a small price for civil servants to pay for the benefits that they receive.

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I appreciate that there might be economic arguments against tenure, but the following is not one of them:

"Tenure is no longer needed because of an absence of performance measures. These measures exist in abundance. Quality of teaching is readily measurable by student evaluations, provided care is taken to prevent teachers from courting popularity by easy grading and light assignments and student evaluations are supplemented by faculty observation of the classroom. "

It is styled as an economic argument, but it is a sentimental argument (largely an appeal to pathos). It depends upon the arguable claim that all students and faculty are capable of fair and elightened evaluation. Evaluative measures may indeed exist, but they are neither abundant nor clear. Student evaluations are corrupted from the start by virtue of a false premise, i.e., that a student knows enough to assess whether his teacher taught him correctly. This calculus is marred by a category error (all students are equivalent consumers of data), and unqualified by perfomance. With respect to the latter, should evaluations by A-students be given more weight than those by C-students? After all, don't grades also assess a capacity for good judgment? Should learning disabilities disqualify students from evaluating professors? Student evaluation is fraught with contradiction arising in part from imposing a consumer model on paideia.

Furthermore, who decides what is a "light assignment"?Determining vague categories like light assignments and "easy grading" would require a highly intrusive public apparatus, a mathematical valuation of all human knowledge to accord with an economic model (so many data of so much value, etc.), and an equivocation of education and vocation.

To give responsibility to "other faculty" for evaluation ignores the fact that faculty are not equivalent units of data production. An expertise in harmonic number theory does not qualify one to assess a music teacher. Will faculty only be assessed by peers, and to what degree of graininess will "peer" be decided. Who decides? (The passive voice can hide a great deal of government!) Neither is production capable of easy assessment. One short article may be worth more than twenty banal books. Who gauges worth versus quantity? Will we have a court of enlightened CEOs determining the relative worth of an article about Augustine's notion of caritas versus a best-selling book on Harry Potter web sites?

Yes, there are bad teachers wedged into tenured posts. But market utopianism won't move them. As "ben" points out above, unions and tenure, whatever their obvious downsides, also provide incentives to teachers--to good teachers as well as to bad. Save tenure, what other incentives will draw the best and the brightest to teach? N. E. Hatfield has this right in his comments. As a conservative and a faculty union member, I've yet to be convinced that I should abandon my economic interests for the sake of a sentimental, utopian vision of an unregulated education market.