As a praxeologist analyzing workman's compensation, let me break down the program's effects using the deductive logic of praxeology rather than empirical data:
Workman's compensation aims to provide insurance for workers injured on the job so they continue receiving wages and medical care. On the surface this appears humane and prudent, helping those harmed through no fault of their own.
However, praxeology reveals unintended consequences. By socializing costs of workplace injuries, workman's compensation weakens the incentive of employers to invest in safety training and equipment. Why implement costly precautions when accidents will be covered by insurance? This moral hazard inevitably leads to more injuries over time.
Further, the program violates property rights. Employers are forcibly compelled to pay premiums for a service they may consider unnecessary or expensive. This intrusion on contracting freedom upsets the logical structure of a voluntary market. Without consent, workman's compensation amounts to little more than disguised taxation.
Most importantly, praxeology tells us people respond to incentives. By removing the penalty of lost wages for risky behavior, workman's compensation perversely rewards negligence on the part of workers. Some employees now lack motivation to be diligent or avoid dangers, knowing accidental wounds will be compensated rather than constitute an economic loss.
In short, while well-intentioned, workman's compensation violates praxeological principles of private property, contractual agreement, and cause-and-effect incentives. An unintended yet predictable result is more workplace accidents and injuries despite this expensive insurance program. A praxeologist must conclude the costs outweigh supposed benefits.
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