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Productivity and wages are most definitely related. Increased productivity is surplus value created per worker. In a strong labor market workers are able to dem
by guelo 11y ago
Productivity and wages are most definitely related. Increased productivity is surplus value created per worker. In a strong labor market workers are able to demand some of the generated productivity surplus as wages. When workers have no power all the gains go to the owners which is what causes inequality to rise.
- yummyfajitas 11y agoIn a strong labor market workers are able to demand some of the generated productivity surplus as compensation. Wages have been somewhat flat because employers are paying workers in (untaxed) health and retirement benefits instead of (taxed) wages. Secondly, there is no particular reason wages should track productivity. Productivity is output / workers. If output increases due to capital (e.g. automation), there is no reason for wages to go up.