I would still be better off just giving the beggar the money!
Increasing the payoff of begging just increases the number of beggars until the average wage once again falls to the point where it is just marginally unattractive—or so I’ve heard. I think someone once suggested that if you visit a poor country and want to help, do not under any circumstances give money to beggars; find someone who seems to be doing something productive, and give the money to them.
...no, I don’t see why that means one shouldn’t give money to beggars.
Let’s say beggars in my city can make $1/hour. Everyone who, in a world without begging, would have made <$1/hour becomes a beggar, and everyone who in a world without begging would have made >$1 hour does not become a beggar.
Now let’s say people in my city become more generous and give more money. The number of beggars cannot increase without the wage of beggars also increasing, because the only reason more people would become beggars is that there is a higher incentive, and if the influx of new beggars drive wages back down, those new beggars will “quit” their “job” and the hourly wage will stabilize. So it may be that now beggars earn $2/hour, and everyone who would earn <$2/hour at normal labor quits and becomes a beggar.
In a country with a minimum wage, this suggests that no one will ever leave a job for begging until a beggar’s wage exceeds minimum wage; despite the horror stories I don’t think this has happened here. It suggests that the population of beggars will probably consist of the people who would have a (low-paying) job if there was no minimum wage but can’t get any job in the current regulatory climate. These people seem worth helping.
In a country with no minimum wage, begging establishes an effective minimum wage. That is, if beggars can earn $1/day, then no one will work for less than $1/day because they’d rather beg. This may be bad from an economic standpoint, but it’s good from a humanitarian standpoint; it means we can be assured every poor person in the country will earn at least $1/day, whether working or begging, and that no one will have to make do with less. If people become more generous and donations rise to $2/day, this just means that all poor people can be assured of a little bit more money. This seems like exactly what people donating to beggars have as their goal.
Although it may leave a bad taste in our mouths that beggars are quitting their fifty-cent-a-day jobs for begging, if we place a greater value on people not having to live on fifty cents a day than we do on the “moral value of hard work”, we are making people better off. We’d have to balance that against the lost productivity of these beggars’ fifty-cent-a-day jobs,but if they’re only earning fifty cents a day, they can’t produce all that much.
[possible counter-argument: if you have a fifty-cent-a-day job, you might learn skills and get promoted. This seems a much more relevant concern in a first world country than in a third world country, where most people labor at dead-end jobs their whole lives, and since first world countries generally have minimum wages anyway, I don’t consider it too important]
[this argument probably only works in Economics Land; I think gworley does a better job of describing what happens in the real world.]
You seem to be assuming that begging is unskilled “work” and thus all beggars make roughly the same “wage” on average. I highly doubt this is the case; a beggar who can more effectively evoke sympathy in passers-by will make a better haul.
For instance, in an urban environment, a beggar probably wants to maximize their exposure to naive folks from out of town; urban residents will probably have learned to ignore the begging more effectively. With a population sufficiently generous and gullible, it’s entirely possible that, for people with few career prospects, it will only be the ones too incompetent to beg who will end up in no-skill minimum wage work.
On the higher end, this also blends into buskers and low-level “my wallet was stolen, I need money for a train ticket to get home to my kids” type scamming as more sophisticated (and profitable) forms.
It was armchair theorizing, informed by knowledge I have acquired, including memories of articles such as the one linked to. I actually wrote the whole comment before looking up that article based on vague recollection of it.
That said, the assumption that an activity that one does to acquire money should, in absence of bureaucratic meddling, pay similar amounts independent of skill at the activity, seems to me far more implausible by default than the opposite.
I do not have hard data, but I strongly suspect a lot of beggars make more than minimum wage. Many don’t, and this varies by area, but in Berkeley at least, there’s a ton of foot traffic and people beg in the same spot day-in, day-out, and I would make a large wager that some if not most of them make more than $7 an hour, on average, tax-free. In fact, you occasionally hear about someone who is employed or on disability or otherwise should not be begging doing it on weekends to make a bit extra, though this is more an issue of supply size than it is of wage.
“I bet this won’t surprise you, but estimates vary. As Michael S. Scott, the director of the Center for Problem-Oriented Policing, says in his online article “Panhandling”:
Estimates vary from a couple of dollars (U.S.) a day on the low end, to $20 to $50 a day in the mid-range, to about $300 a day on the high end. Women, especially those who have children with them, and panhandlers who appear to be disabled tend to receive more money. For this reason, some panhandlers pretend to be disabled and/or war veterans. Others use pets as a means of evoking sympathy from passersby. Panhandlers’ regular donors can account for up to half their receipts.
In a study of Toronto panhandlers conducted by Robit Bose and Stephen Hwang, panhandlers reported a median monthly income equivalent to US $190-$200. ”
I really like Tyler Cowen’s position on the issue. He basically said when in a third world country that receives lots of first world tourists, there usually are a huge number of beggars. Many of these people could get work, but they would make less than they can as skilled beggars. Instead of rewarding this non-productive work, he gives money to poor people who are cooking, offering to work as guides, etc. This way he incentivizes doing productive work, while still giving money to the poor.
Living for a few years in an area that had a somewhat regular beggar population, I think the psychology of begging can’t go unexamined. There’s more at play than just how much money you can get: prominently the dislike of doing “actual work” and the already mentioned suffering of the beggar stigma. From my experience the sort of people who beg are not so much the people who can’t get any jobs (unless won’t = can’t, motivationally speaking), but people with low or uniquely valued enough self-esteem to suffer the stigma, and who would much rather sit on the street corner than do the 9 to 5 day in and day out. Unfortunately I don’t have experimental data on this. Of course they’re mixed in with the people who really can’t get jobs, but giving to beggars for me at least factors in how much I want to reward people who have the above mentioned preferences.
It’s worth pointing out that where I live (a major east coast city) the vast majority of the homeless population seem to have drug, social and/or mental problems, ranging from obviously but mild to incredibly severe. Of course this data is somewhat anecdotal but I have enough friends who are social workers to feel relatively confident about it. There doesn’t seem to be a large class of people making strategic plans to beg based on expected return.
For reference, I don’t give money to beggars (due to concerns about how that money will be used), but I do try to give food to beggars, and I support tax money being used for public health projects. I guess this exposes me as someone who supports interventionist social policies in some cases.
I like the idea of giving actual food away, being something they almost certainly are going to get something worthwhile out of. My father used to keep bag lunches of prepackaged food in his car for that reason.
I recently visited Los Angeles with a friend. Whenever we got lost wandering around the city, he would find the nearest homeless person, ask them for directions and pay them a dollar. (Homeless people tend to know the street layout and bus routes of their city like the backs of their hands.)
Good point!
I live in Brazil and in some places you can actually rent babies to improve your success at begging as a woman.
Also what will the beggars do with the money? The truth is most of them will spend it on drinks.
Begging attracts a certain type of persona, why do you want to encourage it instead of giving a help to people who are not begging? In some cases beggars will actually make more money than people doing serious work.
But the economical and social situations are different in rich countries. In a poor country many people are poor, usually because there is something keeping them poor, be it war, famine, government oppression, societal oppression, or something else. In such a country this argument works: you have to make begging so economically unattractive that few people would do it because they could make more with less effort by overcoming whatever problems are making them poor. Not to mention that if too many people become beggars the begging industry might collapse because there would be too few people producing things for the beggars to buy.
In a rich country, there is a strong social stigma attached to begging. Some cultures make exceptions for beggars with particular obvious reasons for begging (injured war veterans, orphans, etc.), but to my knowledge no rich society considers it acceptable for a person who could earn a living by other means to beg. And, being humans and not “economic men”, the people in those societies feel that pressure and will go to extreme measures to avoid begging, including resorting to theft (albeit a career choice made possible by having a large population with enough money to have things worth stealing). So in a rich society it probably actually doesn’t hurt to give money to beggars, and may even help because it might make begging attractive enough to overcome the social stigma that pushes some people to commit crimes.
That’s my armchair social analysis. It feels like it’s at least a shadow of reality, though, if not more.
Poverty is the default condition of most of humanity for most of history. It would be more accurate to say they have a lack of the conditions for becoming wealthy. Not to say that war, oppression, etc don’t prevent the necessary conditions from forming.
It’s also an absolute term. I believe <2USD/day is a common figure, with <1USD/day for Extreme poverty.
Relative poverty is by definition intractable. That is not the case with absolute poverty.
Is there another term that can be used to differentiate the two with a single word, as opposed to these adjectives?
It’s a moving target. As soon as you’ve “solved poverty”, “absolute poverty” will be defined as <4USD/day. It’s probably best to specify the threshold you mean, if you’re thinking of a particular threshold. This will also make it less confusing to readers a thousand years from now.
What counts as a threshold if not monetary values?
Lack of access to things like running water and antibiotics is a mark of poverty in 2009. The pharoahs of course had neither thing because they didn’t exist, but this does not mean they were poor.
Readers a thousand year from now will inevitably regard all of us as incredibly poor, if they are reading this at all.
The pharoahs of course had neither thing because they didn’t exist, but this does not mean they were poor.
The pharaohs may have been richer than Egyptian peasants in strictly monetary terms, but they were definitely poor in an absolute sense. Since poverty is the default human condition, this shouldn’t be surprising.
What counts as a threshold if not monetary values?
I was not suggesting using something other than monetary values as a threshold (though they are of course something of a placeholder). Rather, I’m suggesting that you specify exactly what threshold you mean when you use one. Rather than “absolute poverty” you could say “living on <2USD a day”, or perhaps define “poverty” stipulatively as “living on <2USD a day”.
I doubt he was the first person to notice it, but Tyler Cowen has made this point more than once. I think it’s also mentioned in Discover Your Inner Economist. Basically, it’s trivially easy to find poor and deserving people who aren’t begging, so why bid up the wages of beggars?
Increasing the payoff of begging just increases the number of beggars until the average wage once again falls to the point where it is just marginally unattractive—or so I’ve heard. I think someone once suggested that if you visit a poor country and want to help, do not under any circumstances give money to beggars; find someone who seems to be doing something productive, and give the money to them.
...no, I don’t see why that means one shouldn’t give money to beggars.
Let’s say beggars in my city can make $1/hour. Everyone who, in a world without begging, would have made <$1/hour becomes a beggar, and everyone who in a world without begging would have made >$1 hour does not become a beggar.
Now let’s say people in my city become more generous and give more money. The number of beggars cannot increase without the wage of beggars also increasing, because the only reason more people would become beggars is that there is a higher incentive, and if the influx of new beggars drive wages back down, those new beggars will “quit” their “job” and the hourly wage will stabilize. So it may be that now beggars earn $2/hour, and everyone who would earn <$2/hour at normal labor quits and becomes a beggar.
In a country with a minimum wage, this suggests that no one will ever leave a job for begging until a beggar’s wage exceeds minimum wage; despite the horror stories I don’t think this has happened here. It suggests that the population of beggars will probably consist of the people who would have a (low-paying) job if there was no minimum wage but can’t get any job in the current regulatory climate. These people seem worth helping.
In a country with no minimum wage, begging establishes an effective minimum wage. That is, if beggars can earn $1/day, then no one will work for less than $1/day because they’d rather beg. This may be bad from an economic standpoint, but it’s good from a humanitarian standpoint; it means we can be assured every poor person in the country will earn at least $1/day, whether working or begging, and that no one will have to make do with less. If people become more generous and donations rise to $2/day, this just means that all poor people can be assured of a little bit more money. This seems like exactly what people donating to beggars have as their goal.
Although it may leave a bad taste in our mouths that beggars are quitting their fifty-cent-a-day jobs for begging, if we place a greater value on people not having to live on fifty cents a day than we do on the “moral value of hard work”, we are making people better off. We’d have to balance that against the lost productivity of these beggars’ fifty-cent-a-day jobs,but if they’re only earning fifty cents a day, they can’t produce all that much.
[possible counter-argument: if you have a fifty-cent-a-day job, you might learn skills and get promoted. This seems a much more relevant concern in a first world country than in a third world country, where most people labor at dead-end jobs their whole lives, and since first world countries generally have minimum wages anyway, I don’t consider it too important]
[this argument probably only works in Economics Land; I think gworley does a better job of describing what happens in the real world.]
You seem to be assuming that begging is unskilled “work” and thus all beggars make roughly the same “wage” on average. I highly doubt this is the case; a beggar who can more effectively evoke sympathy in passers-by will make a better haul.
For instance, in an urban environment, a beggar probably wants to maximize their exposure to naive folks from out of town; urban residents will probably have learned to ignore the begging more effectively. With a population sufficiently generous and gullible, it’s entirely possible that, for people with few career prospects, it will only be the ones too incompetent to beg who will end up in no-skill minimum wage work.
On the higher end, this also blends into buskers and low-level “my wallet was stolen, I need money for a train ticket to get home to my kids” type scamming as more sophisticated (and profitable) forms.
See also this article.
I’m glad you included a link on this one. Until I got to that, it seemed like pure armchair theorizing.
It was armchair theorizing, informed by knowledge I have acquired, including memories of articles such as the one linked to. I actually wrote the whole comment before looking up that article based on vague recollection of it.
That said, the assumption that an activity that one does to acquire money should, in absence of bureaucratic meddling, pay similar amounts independent of skill at the activity, seems to me far more implausible by default than the opposite.
I do not have hard data, but I strongly suspect a lot of beggars make more than minimum wage. Many don’t, and this varies by area, but in Berkeley at least, there’s a ton of foot traffic and people beg in the same spot day-in, day-out, and I would make a large wager that some if not most of them make more than $7 an hour, on average, tax-free. In fact, you occasionally hear about someone who is employed or on disability or otherwise should not be begging doing it on weekends to make a bit extra, though this is more an issue of supply size than it is of wage.
From the straight dope:
http://www.straightdope.com/columns/read/2255/how-much-money-do-beggars-make
I really like Tyler Cowen’s position on the issue. He basically said when in a third world country that receives lots of first world tourists, there usually are a huge number of beggars. Many of these people could get work, but they would make less than they can as skilled beggars. Instead of rewarding this non-productive work, he gives money to poor people who are cooking, offering to work as guides, etc. This way he incentivizes doing productive work, while still giving money to the poor.
Living for a few years in an area that had a somewhat regular beggar population, I think the psychology of begging can’t go unexamined. There’s more at play than just how much money you can get: prominently the dislike of doing “actual work” and the already mentioned suffering of the beggar stigma. From my experience the sort of people who beg are not so much the people who can’t get any jobs (unless won’t = can’t, motivationally speaking), but people with low or uniquely valued enough self-esteem to suffer the stigma, and who would much rather sit on the street corner than do the 9 to 5 day in and day out. Unfortunately I don’t have experimental data on this. Of course they’re mixed in with the people who really can’t get jobs, but giving to beggars for me at least factors in how much I want to reward people who have the above mentioned preferences.
It’s worth pointing out that where I live (a major east coast city) the vast majority of the homeless population seem to have drug, social and/or mental problems, ranging from obviously but mild to incredibly severe. Of course this data is somewhat anecdotal but I have enough friends who are social workers to feel relatively confident about it. There doesn’t seem to be a large class of people making strategic plans to beg based on expected return.
For reference, I don’t give money to beggars (due to concerns about how that money will be used), but I do try to give food to beggars, and I support tax money being used for public health projects. I guess this exposes me as someone who supports interventionist social policies in some cases.
I like the idea of giving actual food away, being something they almost certainly are going to get something worthwhile out of. My father used to keep bag lunches of prepackaged food in his car for that reason.
Agreed, with the caveat that in Economics Land you should’ve just made the high-utility donation in the first place.
I recently visited Los Angeles with a friend. Whenever we got lost wandering around the city, he would find the nearest homeless person, ask them for directions and pay them a dollar. (Homeless people tend to know the street layout and bus routes of their city like the backs of their hands.)
Good point! I live in Brazil and in some places you can actually rent babies to improve your success at begging as a woman.
Also what will the beggars do with the money? The truth is most of them will spend it on drinks. Begging attracts a certain type of persona, why do you want to encourage it instead of giving a help to people who are not begging? In some cases beggars will actually make more money than people doing serious work.
But the economical and social situations are different in rich countries. In a poor country many people are poor, usually because there is something keeping them poor, be it war, famine, government oppression, societal oppression, or something else. In such a country this argument works: you have to make begging so economically unattractive that few people would do it because they could make more with less effort by overcoming whatever problems are making them poor. Not to mention that if too many people become beggars the begging industry might collapse because there would be too few people producing things for the beggars to buy.
In a rich country, there is a strong social stigma attached to begging. Some cultures make exceptions for beggars with particular obvious reasons for begging (injured war veterans, orphans, etc.), but to my knowledge no rich society considers it acceptable for a person who could earn a living by other means to beg. And, being humans and not “economic men”, the people in those societies feel that pressure and will go to extreme measures to avoid begging, including resorting to theft (albeit a career choice made possible by having a large population with enough money to have things worth stealing). So in a rich society it probably actually doesn’t hurt to give money to beggars, and may even help because it might make begging attractive enough to overcome the social stigma that pushes some people to commit crimes.
That’s my armchair social analysis. It feels like it’s at least a shadow of reality, though, if not more.
...”Making them poor?”
Poverty is the default condition of most of humanity for most of history. It would be more accurate to say they have a lack of the conditions for becoming wealthy. Not to say that war, oppression, etc don’t prevent the necessary conditions from forming.
Only if poverty is very poorly-defined. Poverty is a relative term.
It’s also an absolute term. I believe <2USD/day is a common figure, with <1USD/day for Extreme poverty.
Relative poverty is by definition intractable. That is not the case with absolute poverty. Is there another term that can be used to differentiate the two with a single word, as opposed to these adjectives?
It’s a moving target. As soon as you’ve “solved poverty”, “absolute poverty” will be defined as <4USD/day. It’s probably best to specify the threshold you mean, if you’re thinking of a particular threshold. This will also make it less confusing to readers a thousand years from now.
What counts as a threshold if not monetary values?
Lack of access to things like running water and antibiotics is a mark of poverty in 2009. The pharoahs of course had neither thing because they didn’t exist, but this does not mean they were poor.
Readers a thousand year from now will inevitably regard all of us as incredibly poor, if they are reading this at all.
The pharaohs may have been richer than Egyptian peasants in strictly monetary terms, but they were definitely poor in an absolute sense. Since poverty is the default human condition, this shouldn’t be surprising.
I was not suggesting using something other than monetary values as a threshold (though they are of course something of a placeholder). Rather, I’m suggesting that you specify exactly what threshold you mean when you use one. Rather than “absolute poverty” you could say “living on <2USD a day”, or perhaps define “poverty” stipulatively as “living on <2USD a day”.
I doubt he was the first person to notice it, but Tyler Cowen has made this point more than once. I think it’s also mentioned in Discover Your Inner Economist. Basically, it’s trivially easy to find poor and deserving people who aren’t begging, so why bid up the wages of beggars?
Tyler Cowen’s suggested this on his blog and in one of his books.
Surely this argument can be made for providing money to charities as well. In which case, the question is which is better:
1.) A small increase in the number of beggars. 2.) All current and future beggars receiving no aid—a possibility which has multiple problems.
Or am I missing something?
The main character of Heinlein’s Citizen of the Galaxy spends his youth as a professional beggar.