Paul Romer, winner of the Nobel Memorial Prize in Economic Sciences, spoke to CDE’s executive director Ann Bernstein about democracy, business, markets, and development.
Romer argues that “facts are our friends. That is the lesson of the Enlightenment. If we know the facts, we will make better decisions and achieve better outcomes for everyone.”
He says that “the unfortunate, unintended side effects of policies that are designed to raise wages and improve the quality of work for people who have jobs, is that they reduce the likelihood of other people getting jobs.”
Romer thinks of “work as school.” When someone works in a job, they learn things. The benefits they get are a combination of their wages and the additional skills that will make them a more productive worker throughout their career, which will earn them higher wages.
According to Romer, South Africa shouldn’t do concession zones, we should do reform zones. It would be well worth trying some more experiments.