Wilt Alston on Lily Ledbetter

Wilt Alston wrote a piece titled "What Does "Equal Pay for Equal Work" Mean?" for the Campaign For Liberty. In it he explains the fallacy of government regulating pay. I recommend reading it. Here's a quote:

What is an "equivalent job" and who gets to decide? If the owner of the job, the employer, doesn't know what is equivalent -- and the fact that a law is needed illustrates that he ostensibly does not -- how can a third party like the government, itself not subject to any oversight, do any better? How different must a job be before a different wage may be paid for it?

In any trade -- of which the employee/employer relationship is but an example -- there are generally two actors. One actor, the employer, has a job that he wants done, at a wage he thinks is appropriate. (More generally, he has an upper limit above which he will make another decision versus pay that price for that job. This relates directly to the fallacy of the minimum wage.) The second actor, a prospective employee, has time that he is willing to offer in exchange for those wages. (He too has a lower limit, below which he would rather do something other than the prospective job.)

These two actors must agree before the trade can take place. At the completion of that trade, both of these actors are certain that they have received more value than they traded, or they would not have done it. This concept, subjective value, is the very basis of free market exchange in the Austrian method of economics.