« Identity Economics | Main | Are quantities backward-looking or forward-looking? »


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

This is a useful commentary. It deserves wide circulation

So true. This article sounded familiar to me, I knew that I have read something similar somewhere. Until after a little bit of search I actually found out it was another excellent article of yours covering very similar topic: http://worthwhile.typepad.com/worthwhile_canadian_initi/2011/11/should-reality-tv-stars-be-licensed.html

J.V., Jciconsult, thanks for the comments. I have to wonder if this isn't another one of these "economists see through framing" things, where economists don't see the difference between acting for the camera and just being oneself for the camera.

The fact that this documentary takes place in Russia makes if different from North American reality TV. The responsibilities of the film maker are greater when the subjects are more vulnerable.

Rachel, absolutely. I always ask myself the question "would this have got through a university research ethics board?"

Wow, great post. I haven't seen the movie, but agree with the sentiment entirely. The media too often absolves itself of guilt/responsibility in this way.

If you don't despise yourself or any random person on the street for refusing to pay off Nadya's debt, I'm not sure what justification you have for despising the filmmakers. I agree that their retreat to journalistic ethics was pure casuistry, but don't see that they necessarily did anything wrong.

Adam M: "If you don't despise yourself or any random person on the street for refusing to pay off Nadya's debt, I'm not sure what justification you have for despising the filmmakers."

First, the only profit I've derived from Nadya's labour is a few hours entertainment. The filmmakers have enjoyed much much greater benefits from Nadya's work.

Second, the film was made 4 years ago. Nadya is now 17. Apparently quite a number of people have contacted Nadya and offered her any assistance she needs - see http://fashionista.com/2012/03/the-complicated-backstory-behind-new-doc-girl-model-why-its-subject-model-nadya-vall-is-furious-at-her-portrayal/4/.

According to this same source:

When I spoke with the directors, Redmon told me he was trying to get the film translated into Russian so Nadya could actually see the film. He also told me that they had hired someone to go to Russia, in an attempt to get back in touch with the young model, and the investigator had reported back that they “should stop asking questions.”

It might have been possible to pay off the agency at the time and get them off Nadya's back. It's not possible now.

"would this have got through a university research ethics board?"

Sometimes even they are asleep at the switch. My brother participated in a study of siblings of juvenile diabetics. They study did a blood test to sample antibodies to predict the sibling's chances of getting diabetes. The study was double-blind, which meant no therapy was offered.

It was unethical because consent had to come from the parents, who on hearing the offer of a prediction of having another diabetic child would not refuse. My brother did not want to participate but was forced to because of my mother who said "she had to know". This was at a Toronto research hospital, under the supervision of UofT, of course. The ethics of that study stank.

Bad ethics often happens when we separate the best interest of the subject from that of the study and forget that the test subject or documentary star's interest must come first.

Determinant, excellent point - and pre-supposing that parents can totally detach their interests from those of the child, and always and inevitably put the child's interests first, is assuming a lot, as your case illustrates.

"paying sources compromises their integrity"

Hmmm ... following that logic, wouldn't selling a documentary film compromise the filmmakers' integrity?

I'd speculate that some mobsters were expecting one thing from the movie and got another, and that it may not be entirely safe for the filmmakers to go back to Russia. I tend to doubt that it would have been as simple as paying the 'agency' a few grand to let a prize philly out of the stable. They'd want their cut of the NPV of all her future earnings. What will rich Russian and Chinese men pay for the companionship of a 17 year old Caucasian model? Lots, I bet.

Sickening stuff.

You often hear this criticism of journalists, e.g. that they should help people they see in war/famine/etc zones rather than just filming and interviewing them. This is different however in that that filmmakers deliberately sought her out and used her for a unique and profitable product; she wasn't the latest of hundreds of miserable people whose lives are glimpsed on the news each day. Normally high-mindedness is something more common in journalists (afflicting the comfortable, etc.) but I find with documentarists that it is far worse and more prevalent there. I don't think "raising awareness" precludes giving assistance do someone who could not fix her problems by herself.

BTW, I didn't mean to single out any particular nationality as being more likely to frequent houses of ill repute. Just refering to the places where the girl seems to be working.

Patrick - yes, China and Taiwan were the places named. Look, there's a massive shortage of young women in China due to years of sex selection + a cultural obsession with youth (not unique to China by any means, but particularly strong there). There are lots of poor young women in Russia. Markets work.

Shangwen - in some ways the distinction between news and not-news is less clear than it used to be. How many people get their "news" from the Daily Show and the Colbert Report, e.g.? Do you think that as the nature of "news" changes, the rules around news gathering change too?

I can't help but think of Man Bites Dog ( http://en.wikipedia.org/wiki/Man_Bites_Dog_(film) ) every time I see a documentary and wonder about the subjects. It did a good job of mocking just how the presence of a camera can affect people's judgement, and how they can unintentionally create or enable the situations they document.

Gwynne Dyer had a good article two years ago that China's chronic gender imbalance will have to lead to wide-open immigration for females. Significant migration INTO China is not something I think has happened in several hundred years. It would be a challenge for Chinese society but the alternative is worse. Unattached men without families are the perfect base for extremism, political unrest and violent movements of whatever political stripe. The answer is simply to let the women in so that those extra men can have the family life everybody wants and which from the state's point of view promotes tranquility and stability.

China is a country of over 1 billion people. India is also heading for a similar imbalance and is also just as big. Where do you think a flow of women on a scale sufficient to make a difference will come from exactly?

Reason has a point. Additionaly, even if there would be such potential source of girls, it would leave exporting country (like Russia) in the very same situation that the Chinese face now. Unless there exists a country with surplus of young girls (country after war, country where birth control was used to give birth to girls) you cannot resolve this problem, you will only shift it around. And given the chinese population, you can make this problem an order of magnitude higher for such countries.

JV, reason, yes, there is no way that China can resolve its gender imbalance through immigration. What happens if that women flow from poor areas to rich ones, so N. American and European men with a strong preference for a wife of Chinese origin find a bride in the big Asian cities, men from the big rich cities marry women from the smaller centres, men from the smaller centres marry women from the countryside, etc., etc., until the man left without a wife is a poor peasant in a remote community. (Next step in the logical chain: remember that poor peasants in remote communities are the people who start revolutions - though I personally think that's overdone).

Russia and other countries in the "vodka belt" are particularly attractive as a source of young women because their gender imbalance runs the other way - alcoholism and related social ills mean that Russian male life expectancy is much lower than in other countries at a comparable stage of economic development.

Of course marriage and sex are two different things, and one can have without the other...

My back of an envelope calculation is that for China and India combined you will need 10-20 million women to migrate every year. And then remember that historically women are less inclined to migrate than men. It seems much more likely that the flow (what there is) will be in the other direction.

"Russia and other countries in the "vodka belt" are particularly attractive as a source of young women because their gender imbalance runs the other way - alcoholism and related social ills mean that Russian male life expectancy is much lower than in other countries at a comparable stage of economic development."

To some extent there's a bit of a mismatch between the "suplus" woman of Russia, and the "surplus" men of China, since the gender imbalance in Russia is a result of having more old woman then old men (since men conveniently die younger), whereas in China, the imbalance is a shortage of woman accross the age spectrum (and presumably with the excess "demand" for woman at the younger end of the spectrum). I have a sneaking suspicion that there aren't a lot Chinese men desperately courtng Russian Babushkas.

Bob - true, but there are knock-on effects. In N. America, you'll get a Hugh Hefner courting young women, and taking them out of circulation. Even if a divorced 70 year old is hitting on a 40-year old, that still leaves the 40 year old man without a partner looking to younger women. Etc.

Also widespread abuse of alcohol and other drugs as well as joblessness dampens the attractiveness of men of all ages as partners in Russia,

I'm not sure how pertinent demographic pressures are. Yes, they're real and this could happen anywhere, but it's more likely to occur in certain countries, is it not? I think the rule of law, institutions, elite consensus and a strong civil society are arguably more important than M:F ratios in determining if this happens and how it gets handled.

The tangle of race and sex is complex. In the bad old days of the American South European-American men could have sex with African-American women, but African-American men had to stay away from European-American women. A good friend of mine who is Filipino and is marrying a European-Canadian women tells me that the assumption in the Philippines is that a Filipino guy with a European looking wife is wealthy. He would consider it unsafe to travel in the Philippines with his wife. A young blond girl/woman is a status symbol, much like the fancy car or penthouse apartment.

Rachel - interesting!

Shangwen: "I think the rule of law, institutions, elite consensus and a strong civil society are arguably more important than M:F ratios..." Some people would argue that M:F ratios will have profound effects on the rule of law, institutions, etc. But I think no one really knows how high m/f ratios play out in a one child society - all of these 'bare branches' (unmatched men) still have a woman: Mom.

Thank you for this, Frances. This is an excellent post.

The social problems due to M:F imbalance isn’t the only adverse consequence due to the One Child policy. The Economist recently ran an article about China’s growing dependency ratio and the impact on it’s future prosperity: http:www.economist.com/node/21553056. Given the cons are obvious, I wonder what’s stopping them from ditching the policy.

Contra the bullish forecasts of China’s long term political/economic preeminence this is another reason I’m bearish on China’s long term prospects.

DavidN: "Given the cons are obvious, I wonder what’s stopping them from ditching the policy."

It's close to being ditched already. When two "one childs" get married, they are allowed to have two children, and since the one child policy came into force in 1980, an increasing number of people in their child bearing years are "one childs" thus able to have two children.

Also, if you look at actual fertility rates for people of Chinese origin in Canada, the US, etc, they're pretty low, slightly lower than for people of European origin, IIRC - most families have one or two children. That plus general loosening of enforcement means that it's really not the one child policy driving fertility rates all that much any more.

High dependency ratios are overrated in my view because:
1. People look at the dependency ratio of older people but not children or non-working wives which tend to go in the other direction.
2. Nobody counts the dependency implicit in capital ownership.
3. People forget about unemployment, underemployment.
4. Not all work is in the market.

Regarding reality shows, I can't even watch "Hoarders", because my brother was in a similar situation. These people need serious assistance, and their families push them onto TV. There is ALWAYS a family member who contacts the producers. The 'hoarders' don't do it themselves, because fundamentally they don't see themselves that way. So it's doubly sad when they are exploited for entertainment. Same with any of the shows featuring children. Their parents are flat-out exploiting them.

Regarding China, why would the Chinese government open up immigration for women? The express purpose of the "one-child" program was to significantly reduce the population. That a high percentage of young men can't find marriage partners and therefore reproduce is a feature, not a bug. And I rather doubt that the Chinese government cares very much that a huge number of old people are going to starve. After all, they are beyond their productive years.

The gender imbalance resulting from the one child law strikes me as unintended consequence rather than desired outcome. For one, it's doubtful the Communist party would purposefully create a generation of unattached young men who could pick-up where Tiananmen left off. If I was a Communist Party official, I would try to find ways to funnel as many young men as possible into the People's Libration Army, where I could keep a close eye on them.

Anyway, I agree that there's no place that has a similarly sized excess supply of girls, so migration is just going to re-arrange the deck chairs.

Rachel: "A young blond girl/woman is a status symbol, much like the fancy car or penthouse apartment"

I would say that this is valid almost universally, not only in Philippines. And I mean this does not have to be irrational. It may be just a focal point for competition in the game of power especially in absence of formal rules of this game. Status symbols signalize your confidence and power, in one way deterring and frightening your competition and on the other hand helping you get more patronage relationships with people who need favors from you.

White blonds were rare, so they are natural focal point if you need prize-wife. Having such a wife that does not need to do anything except maintaining her looks (like having long nails unsuitable for work) further signalizes your wealth.

Now, what is the moral culpability of the filmmakers, who chose not to pay for Nadya's "happy ending", versus the culpability of us, and everyone else sitting here at home, who could have paid her more. (Is it the sweatshop employer who exploits the workers, or every other person who refuses to invest and pay more?) Why should the filmmakers be especially responsible for Nadya's welfare, rather than spending money on their own children, instead of all the other higher income people who could have sent money to Nadya "at less marginal disutility"? Is it just because they happened to be there? Peter Singer wouldn't agree. Economically, filmmakers should specialize in filmmaking, and charitable givers should specialize in charity. The two may or may not be one and the same.

Now you can say that these cold economic considerations can and should be overridden by simple human compassion. But you don't know these people, you weren't there; you have no right to judge.

"Yet surely everyone has a right to own their own body, to profit from their labour"

We have the right to try to profit from our labour, our skills and our capital goods. Whether we actually do profit depends on the transactions that others willingly enter into with us. Nothing you said indicated that Nadya was prevented from trying to maximize her profits, or obstructed in doing so. She merely chose not to. Now you can call that taking advantage of her ignorance - in the same way, for instance, that every buyer takes advantage of the ignorance of firms with market power to fight against price discrimination. Again, perhaps a vulnerable young female is special, perhaps these guys simply ought to have been nicer to her. Or perhaps they already are extremely generous people - you really don't know. Remember, for every emotional story of a child model we see, there are thousands of children suffering far worse fates whom we don't.

The irony is that this analysis undermines the fundamental thrust of such films - you can charge the people who pay girls to do things with "exploiting" them, but when it comes to transferring income to improve others' livelihoods, that is something we are all equally responsible for, and to single out those who are in fact doing the most for these individuals for the greatest blame due to sheer proximity - we economists should know better. The filmmakers would have to employ this very defense of their own actions, which simultaneously undermines the whole thrust of their film...

Saturos: "The filmmakers would have to employ this very defense of their own actions, which simultaneously undermines the whole thrust of their film..."

Interesting point.

I think the popular mentality which, perversely, seems to regard the person who "underpays" the worker as a worse villain than all those sitting at home who refuse to transact at all - implicitly indicating that marginal improvements to the needy which are perceived as exploitative are to be dispreferred to zero improvements, thus encouraging the persecuted entrepreneurs to go with society's preference and do nothing ("I'll take less flak for doing nothing at all, than for trading self-interestedly and paying them "exploitation wages"), is responsible for much of the poverty in the world today and indeed throughout history.

We all implicitly endorse "common sense morality" by not criticizing those who do nothing for defaulting on their utilitarian obligations. We don't regard it as greedy (as an intelligent utilitarian would) to succumb to disincentives and do nothing at all - so create such disincentives through "social justice" rhetoric, and nothing will get done.

See also this: http://econfaculty.gmu.edu/bcaplan/e103/micro2.htm

(Actually, I think Bryan's entire course is a masterpiece, I hope he's still teaching it.)

Thus we encourage less people to make such illuminating films, and more people to sit at home criticizing those who do make them, whilst not actually paying Nadya herself a dime.

Saturos: your biggest failure is that it seems that you automatically see market outcomes as "improving" the living conditions of those that are getting "exploited". If we are looking at this particular example, it is known that mafia uses durgs, threats to family or other means to enslave those girls. In essence that is a fraud.

On the other hand there may very well be market outcomes that will indeed destroy lives of millions. Consider another example: biofuels. Making fuels from food imposes pecuniary externality to billions of third world population living in cities and slums all over the world. While biofuels make farmers and people who drive their cars richer in real terms, this achievement is possibly reached via pushing the real wage of millions under their subsistence level.

Alos imagine that people working in sweatshops in totalitarian country would be slaves, victims unfortunate victims military raids in Africa. Their bodies as well as their product has some market price, depending on the costs of slave rades and such.

If I would sum it in a nutshell, advocates of market solutions to poverty seems to automatically assume that everyone controls their body and output of their labor which they can contract "voluntarily". This is very in line with libertarian thinking about "property rights" as given from above, as "natral rights" and idea that markets always clear without any real externalities. But I can assure you that this is only fairy tale.

An interesting comment, Mr.(?) Dubois. Allow me to respond.

At no point did I suggest that all market outcomes are socially improving. Indeed my earlier posts had little to do with the "virtues of markets" at all. I leave that stuff to others - go read Don Boudreaux's blog if you want to read free-market eulogies. But in the example I mentioned, do you deny that a worker who is offered an employment contract which he accepts is better off than if he hadn't been offered it?

But your criticism is unfounded. In your suggestion that girls in this business may not benefit from their employment, you yourself use the words "fraud" and "enslave". Now, a *market* transaction by definition is voluntary. So when a girl or her family is physically threatened if she refuses an offer or command, then that is ipso facto an involuntary relationship, and not a market relationship. It may be that in common parlance we refer to any relationship that has the trappings of commerce as being a market relationship, but then your quarrel should be with common parlance, not markets. Furthermore, free-market capitalism is well understood to operate under a framework of criminalizing fraud - it is one of the classic examples of offences that even libertarians object to. So it is hard to see how you can blame markets for a fraudulent transaction which hurts an employee. Indeed, according to an extended definition of voluntary exchange, it's not really voluntary unless the thing you believe you are consenting to is in essence the same as the thing you end up doing. As for drugs, this is just a version of saying that it is sometimes better to prevent people from making their own decisions, as they may have been reduced (by themselves) to a state where they are incapable of effectively pursuing their own interests - as defined by the critic.

Regarding biofuels, you should first of all note that land which is reallocated to biofuel production instead of food production is lately almost entirely due to government subsidies. A market system allocates resources to where they generate the maximum benefit to consumers - it is precisely the excessive and ill-applied concern over externalities which has led policymakers to distort markets and divert resources via subsidy away from food production. You should also remember that "pecuniary" externalities are not externalities in the strict sense of the term. An action which produces a negative externality to me is one that makes me worse off than I already am, not merely one that makes me worse off than I was going to be, or which withdraws an opportunity which was going to benefit me. If I am about to sell you my house, but then change my mind and rent it out to my friend instead, then I have imposed a "pecuniary externality" on you. You could say that you have "lost" the house; but that would just be a figure of speech. In fact you never had it. Whether you did get it was precisely contingent on whether the person you expected to give it to you managed to find something better to do with it between now and the time when you received it.

It is true that humans beings themselves can be sold on markets, as the objects rather than the subjects of transactions. But no libertarian ever endorsed such a market - it would violate the harm principle. Markets are tools to further the ends of those who use them - it does not at all imply that those ends are necessarily good ones. If I trade with you to procure a gun to shoot my wife, then we both benefited from the market, though she suffered from the action it made possible. Just because something is done on a market, doesn't make it good. But that is not the fault of markets. Rather, once you have ruled out things that are bad (killing, stealing, enslaving, etc.) my inclination is to say that whatever else is done is consensual between all people involved, and hence good or at least not for us to judge as bad on others' behalf. (Even if we are convinced that eg. drug abuse is bad, saying that we are justified in forcibly obstructing such use is a different matter altogether.) Someone will be glad for a market to benefit in their activities, and the rest of us should be indifferent to them. But I agree that we should refrain from buying "blood diamonds", or other products made with actual slave labour, because normally these transactions finance the coercion of the slaves who would be better off if those transactions could not be made.

Markets "fail" or fall short of the theoretical efficiency ideal all the time in a variety of ways. But that does not mean that they are no good, any more than your car is no good for having an imperfectly efficient engine. It is even less clear that governments can usually do any better, indeed there is much evidence to suggest that any given government intervention will suffer "government failure", a cure far worse than the disease. Collective action problems are rarely solved by further empowering the monopolists of the use of force, who suffer the same incentive problems as private actors if not worse - the notable exception being the provision of law and order itself. You should see cases of inefficiency as natural limits on the realizability of Pareto improvements, turning a skeptical eye to any proposal to overcome the barrier by tasking a centralized group with the power to coerce others. As for controlling your own body and output, Frances Woolley seems to be of the view that these are rights that we should take for granted.

In sum, there are a few good arguments to be made against markets - but you don't seem to have made any of them. Instead you have leveled criticisms at situations where people suffer from behavior which is not free-market behavior at all. Your criticism of my position, or rather the position which you imputed to me (since I wasn't really saying much about the desirability of markets in general at all, only the merits and demerits of the specific case involving the girl Nadya) seems to be more aptly described by the term "fairy tale".

Aha - I just found the famous quote by George Stigler. Here it is:

"A famous theorem in economics states that a competitive enterprise economy will produce the largest possible income from a given stock of resources. No real economy meets the exact conditions of the theorem, and all real economies will fall short of the ideal economy—a difference called “market failure.” In my view, however, the degree of “market failure” for the American economy is much smaller than the “political failure” arising from the imperfections of economic policies found in real political systems. The merits of laissez-faire rest less on its famous theoretical foundations than on its advantages over the actual performance of rival forms of economic organization."

Or as Arnold Kling likes to say, "Markets fail. Use markets."

I noticed that the article mentioned Nadya keeping her 'dignity more or less in-tact', after the film was made. I will guarantee you, making the safe assumption that the author meant 'virginity' when 'dignity' was used, Nadya didn't have her virginity when she returned to Russia. One thing no one mentioned was the recruiters reference to the fact that the Japanese agency owner '...likes young girls very much.' My question was, 'Is she recruiting models or sex-toys for the agency owner. It was obvious to me Messiah (odd choice of names)was ex (or current) Russian mafia. He had killed many people by his own admission. Although he mentions 'in a past life'. I also questioned what kind of parent would send their 13 year-old daughter off to Tokyo alone(yes she had the film crew but doubt they were looking out for her best interests)? I do recall a caption saying Nadya was 15 but the captioning may have been incorrect. They captioned that both Madelin and Nadya were 15 if I remember correctly. I did appreciate the movie in one aspect. It showed the sh*tty condition the world is in. I guess it's no different than these insecure psychologically deranged mothers entering their 4-10yo daughters in beauty pageants in the US.

Just because something is done on a market, doesn't make it good. But that is not the fault of markets. Rather, once you have ruled out things that are bad (killing, stealing, enslaving, etc.) my inclination is to say that whatever else is done is consensual between all people involved, and hence good or at least not for us to judge as bad on others' behalf.

The comments to this entry are closed.

Search this site

  • Google

Blog powered by Typepad