I think it teaches a kid that if they can withstand pain, then they can ignore consequences. And then they become a teenager and a potential sociopath.
Hitting kids is only good for bringing them up short, IMO, and that's for extreme cases. Hitting your kid, or spanking them, or whipping them, does impart a valuable lesson: that at the end of most behavior people disagree with is pain. On the other hand, when you're trying to impart that lesson over, say, breaking a toy? You're teaching them a meta-world lesson for a micro-behavior.
In other words, the punishment should match the crime. Kid breaks a toy? You take their toys away as a lesson about what happens when you break all your toys and no one buys you anymore. Your kid steal? Make them work for free on pain of death. The point is, you don't use the lash as your default discipline tool because it sends a fucked up message to kids about the nature of consequences, and results in fucked up coping mechanisms. Everyone always likes to act like talking it through with your kids afterwards makes it ok, I don't really think so. It's necessary to any degree to explain stuff to kids, but the whole "You made me do that" routine just leads to a messed up Jekyll/Hyde relationship between parent and child. And in truth, I think it's more to assuage a parent's guilt at hitting their child by trying to rationalize what they did to them. Especially after the 2nd, the 3rd, the 4th time...
What have you seen that supports that, though? I'm not talking about kids who were beaten, here. Spanked, yeah. But not beaten. Big difference to me.
What if they refuse to work after they stole something. What can you do after that point?
Not saying it's the 'default tool', quite the opposite. It's the last resort.
Unless there's a few good kind of studies on it, none of us have grounds to say. Obviously, I reckon it works pretty well, because my parents used that method of discipline on my siblings and I and we've all turned out pretty decent, and have heard/seen people discuss how that kind of parenting is monstrous when they couldn't control their own little shits. So I fully recognise I'm biased in this manner, and I also know anecdotes are worthless.
So, I guess...
* GiglameshDespair shrugs