Thursday, April 26, 2012

White collar excesses


Deductive reasoning (famously championed by Sherlock Holmes - who ‘is famous for his astute logical reasoning, his ability to adopt almost any disguise and his use of forensic science skills to solve difficult cases’) can be used to derive theoretical predictions and testable ideas. Deductive reasoning is logic that progresses from the specific to the general.
Either method can be employed to predict what will happen to a firm’s desired level of employment if it is forced to pay a higher wage. One method is to look at a number of firm’s in which wage has gone up. Well here is an easy one, if we were to look at MTA specifically ‘white collar’ those who receive renumeration of six figures in addition to all the fringe benefits, with all others perks (such as yearly new vehicles) then we can generalize that the ‘white collar’ are wasting New Yorkers tax dollars. The other side of the coin is for how long will this waste go on? As we know there are two sorts of employees. You have employees who are ego centric (white collar), who say this job makes me really important. Then there are other employees who are job centric (blue collar) that are just trying to do the job. Based on the change in employment in each we can formulate a prediction that those ego centric are reducing resources. This is an example of inductive reasoning which we believe the MTA board misses by a mile.
A second way is to start with several general assumptions about the goal of any firm and the determination of revenues and costs. Specifically about deducing ‘white collar’ excesses that effect the balance sheet. This inductive look at the ‘white collar’ excesses at MTA is both general and more fruitful in looking at the nexus of waste.

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