The theory of the lump of labor has helped to perpetuate negative perceptions of older people. The theory rests on the notion that the economy has a fixed number of jobs available and that employment of one group -- in this case older people -- means unemployment of another group. However, among economists, the theory is widely acknowledged to be a fallacy, as it fixates blindly on the short run, and ignores long-run labor market adjustments. This report illustrates just how the lump of labor theory contributes to the total cost of age discrimination in America -- both monetary and nonmonetary
