{"id":122,"date":"2004-09-22T23:16:31","date_gmt":"2004-09-23T04:16:31","guid":{"rendered":"http:\/\/server97.snhdns.com\/~ravik\/wp\/?p=122"},"modified":"2004-09-22T23:16:31","modified_gmt":"2004-09-23T04:16:31","slug":"anti-discrimination-law-that-which-is-not-seen-part-i","status":"publish","type":"post","link":"https:\/\/www.ravikiran.com\/blog\/classic\/200409\/anti-discrimination-law-that-which-is-not-seen-part-i\/","title":{"rendered":"Anti-discrimination law: That which is not seen. Part I"},"content":{"rendered":"

Madman asks about anti-discrimination laws<\/a>. Predictably, many of the commenters who support property rights “in principle” support such laws, not because there is any evidence that such laws work, but because they like the sound of it. <\/p>\n

Many of the commenters claim that it obviously<\/i> doesn’t make sense to discriminate on the basis of caste or colour while hiring, so if people are still discriminating, it must be because of irrational bigotry.<\/p>\n

Actually, that’s not quite correct. Bigotry it is, but it is not necessarily irrational. I have two examples to explain my point.
\n
\nOne of my professors at B-school talked of a study carried out on Hero cycles. Apparently, they are very good at inventory management. On investigation, it was found that this was because all the firms that supplied parts to Hero cycles were either related to or belonged to the same caste as the Munjals. This enabled them to forge a close relationship between the firms and they could work together without having to haggle over credit terms and stuff which bog down other companies.<\/p>\n

The other example is a rather famous one. The diamond trade in India is monopolised almost entirely by Palanpur Jains. Transactions worth crores of rupees take place without any documentation at all. They can manage this because the infrastructure provided by their caste is a good replacement for the legal system. <\/p>\n

Now someone is going to turn around and say that that is why<\/i>we need laws against discrimination. I will answer them by quoting from an entry on reservations written by the mysterious Aftab<\/a> in the blog Spontaneous Order<\/i><\/p>\n

In a protected economy, you will be more interested in hiring trusted people because you are more worried about your employees cheating you than about your competitor driving you out of business, and naturally that means that you will hire people from your own caste. In a competitive economy, you will hire competent people. And as a practical matter letting loose a multinational company on a small town is the best way to force local companies to discriminate less. Throttling private companies from hiring seems to be the exact wrong way of going about it. <\/p>\n

Likewise, in a country where legal protections are weak and contracts aren’t enforced speedily and quickly, you have to rely on extra-legal means to protect yourself. That frequently means that you have to rely on your caste network to provide you with the necessary support. If you can rely on the courts to give you justice, you will be less uncomfortable about dealing with people whose background you do not know.<\/p>\n

Finally, as long as reservations remain, people will band together with their own caste brethren because this banding is needed to get their men into power\n<\/p><\/blockquote>\n

An anti-discrimination law will have to be necessarily broad, because if it were narrow, it would be easier to get around. For example “Do not discriminate on any basis not related to the job” is broader and vaguer than “Do not discriminate on the basis of sex” which is easier to get around (for example, by setting strength tests – American companies actually used to do that). But when a law becomes broad and vague, there is a greater possibility that it hurts innocent people, and there is greater scope for litigation. The time and effort taken up by the continuous rule-making, guideline-setting and litigation that will be involved is time that will detract from the simplification of the legal system and implementation of good laws. The time of the courts taken up in anti-discrimination litigation is the time it could have spent in enforcing contracts.<\/p>\n

So the moral of the story is, don’t keep laws on the books just because they sound good to you.
\nThus ends Part 1. There will be more tomorrow.<\/p>\n","protected":false},"excerpt":{"rendered":"

Madman asks about anti-discrimination laws. Predictably, many of the commenters who support property rights “in principle” support such laws, not because there is any evidence that such laws work, but because they like the sound of it. Many of the commenters claim that it obviously doesn’t make sense to discriminate on the basis of caste […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":[],"categories":[2],"tags":[],"_links":{"self":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/posts\/122"}],"collection":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/comments?post=122"}],"version-history":[{"count":0,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/posts\/122\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/media?parent=122"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/categories?post=122"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ravikiran.com\/blog\/wp-json\/wp\/v2\/tags?post=122"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}