Borhas wrote: bk1 wrote:
kapital98 wrote:BK, just because you post on TLS all the time doesn't make you right. Some of the advice you give is good but some of it is just plain awful.
lol I never made the claim that I'm always right (or that post count has anything to do with that) and have been wrong plenty of times before.
I think Kap mistook you for Bitey
I did. I apologize
I still stand by my comments in general but in this circumstance it is clear that BK was being genuine. In that I apologize.
BK: One of the best models to explain the legal market is a "cobwebb" labor theory. In this situation you have 2 lagged variables. Prices, in labor theory wages, are lagged. Input of human capital (i.e. lawyers) are also lagged.
When wages are high a lot of people want to be lawyers. However, when all of these people enter the market wages go down, people leave the market, and lawyers tend to go back to equilibrium. The major difference between this model and traditional neoclassical economics is the market will never go to it's true equilibrium ("effecient" supply will never = demand.)
It's important to note that it takes a lot of time to become a lawyer (3-7 years depending on how you want to measure.) By the times wages change the people who are already on track to graduate will not be able to change their decision to be a lawyer without severe loss (either they go into a market with lower wages or they cut their loses -- either way it's bad for them.) This is why you want to go into law school at the end of a recession and make sure not to go into when at the end of an expansionary period.
The elephant in the room that I have not addressed is the recession. This is a jobless recession and, when factoring in the lag period of becoming a lawyer, greatly explains why the legal market has been so bad. I've explained the cyclical nature of the legal profession in much greater detail in my older posts (I'll provide a link if necessary.)
It's primarily this lag period and a jobless recession that makes the legal market look so bad. Beyond that you have to take into account the structure of the legal market. Almost constant supply and increasing demand. This is what almost everyone harps on because it's the easiest to understand. There are serious problems with the legal market but they will get better. Will they get back to the 2006-07 levels? Maybe, it really depends on what the 'equilibrium' wage is and whether lawyers were overpaid before the recession. Traditional theory would dictate employment goes back to equilibrium but wages decrease. This may not happen due to the market structure of the legal profession.