Gary Becker and Timpson


One of Gary Becker's great points was that irrational, or taste, discrimination is costly to the person doing that discriminating. That then leaves an opportunity to others, in that those being discriminated against are thus cheaper than an objective evaluation of their skills would indicate, meaning that those others can hire workers at less than their likely productivity. It's possible for us to take this idea further too, as we've mentioned before: if you think that taste discrimination is going on then you must also believe that those profit opportunities exist. At which point we've a useful metric to use to see whether we really do think such discrimination is going on. Which brings us to this from John Timpson:

Most of the Timpson drama is provided by the colleagues who run our shops, many of whom have overcome considerable personal challenges to make a success of their lives (10pc of the people on our payroll have a prison record). We pick everyone for their personality, consequently they have some fascinating stories to tell.

We are entirely willing to believe that those with prison records are discriminated against, some fairly, some not. Indeed, one of us, decades ago, deliberately hired a book keeper straight out of his prison sentence for fiddling the books of his previous employer. We knew that his being jugged has scared the Bejayzus out of him and that it wasn't going to happen again. We know, from personal life, of other such cases as well. We would not be surprised at all to find that Timpson is able to profit by taking advantage of that taste discrimination. Or perhaps we might say that it's a matter of asymmetric information here: not everyone who has served time is a lemon in the Akerlof definition, but how do you tell? Get that right and there is an opportunity.

But our deeper point here is that this can be used as a measure of other discriminations. Who does believe that deliberately and specifically hiring women because they are currently underpaid (as Dame Stephanie Shirley famously did with female programmers at FI Group 50 odd years ago) will lead to greater profits? Or insisting upon job shares? Or hiring those of a rather greater melanin blessing than the average of the UK population? For to believe that there is such discrimination is to insist that there is such a profit opportunity. A non-belief in the opportunity is a non-belief in the original accusation of taste discrimination.

We do not, by the way, insist that no such discrimination occurs. We don't think it does, not to any great extent, but that's different. There are those who insist that it does: at which point our question is, well, why aren't you out there making your fortunes by exploiting it?