5 ms·

Only if you think businesses that rely on extremely low wages in order to be profitable deserve to exist. Frankly if the only way you can make widgets is to pa

Only if you think businesses that rely on extremely low wages in order to be profitable deserve to exist. Frankly if the only way you can make widgets is to pay your widget-makers just enough so that they don't die, or perhaps less, then in my opinion society should reconsider how valuable it considers widgets to be, or at least whether someone else can make widgets more efficiently.

ianai 10y ago
It's called a market externality. In economic terms, any externalities like this are a symptom of market failure. Get enough of them and a market won't exist or arguably should not. At the very least it represents inefficiencies. Everybody's supposed to agree to hate all of the aforementioned in a capitalistic economy.
winstonewert 10y ago
@ianai, how is this an externality? Aren't externalities costs/benefits that accrue to third parties? But this doesn't seem to be in that category.
- ianai 10y ago
  An externality impacts the market through a means other than the immediate price point of a good. As Milton Friedman put it, the market only affords one communication method between supplier and demander: price. That, alone is meant to encapsulate all input costs. If to employ someone to make or render a good or service the employer relies on an external factor such as the state of the world then the employer is exploiting a market externality.
  - winstonewert 10y ago
    That's a much wider definition of externality then I was taught when I studied economics. To quote wikipedia: "In economics, an externality is the cost or benefit that affects a party who did not choose to incur that cost or benefit" So, it's not just any state of the world, but in particular that my actions cause cost/benefits to other parties.
winstonewert 10y ago
What if the widget-makers are teenagers who are working their first job? They don't need to support themselves by their labor yet. I think there is some room for these kinds of jobs. Obviously, when adults are trying to support themselves with this kind of job, we have a problem.
- Consultant32452 10y ago
  Only 24% of minimum wage workers are teenagers. http://www.pewresearch.org/fact-tank/2014/09/08/who-makes-minimum-wage/ http://www.pewresearch.org/fact-tank/2014/09/08/who-makes-mi... That mans 76% are 20+.
- undersuit 10y ago
  Why is that a problem? The teen, not having to support themselves, has an advantage over the self-supporting individual, they can accept lower wages. In return the company has a choice, to employ teenagers for less money and dealing with the consequences that they are part time or seasonal, or to employ the individual that demands a living wage for themselves and dealing with the consequences that they are full-time and rather permanent.
  - winstonewert 10y ago
    I don't think it is a problem. My point was that not every job needs to pay a living wage.

ianai 10y ago

It's called a market externality. In economic terms, any externalities like this are a symptom of market failure. Get enough of them and a market won't exist or arguably should not. At the very least it represents inefficiencies. Everybody's supposed to agree to hate all of the aforementioned in a capitalistic economy.

winstonewert 10y ago

@ianai, how is this an externality? Aren't externalities costs/benefits that accrue to third parties? But this doesn't seem to be in that category.

ianai 10y ago
An externality impacts the market through a means other than the immediate price point of a good. As Milton Friedman put it, the market only affords one communication method between supplier and demander: price. That, alone is meant to encapsulate all input costs. If to employ someone to make or render a good or service the employer relies on an external factor such as the state of the world then the employer is exploiting a market externality.
- winstonewert 10y ago
  That's a much wider definition of externality then I was taught when I studied economics. To quote wikipedia: "In economics, an externality is the cost or benefit that affects a party who did not choose to incur that cost or benefit" So, it's not just any state of the world, but in particular that my actions cause cost/benefits to other parties.

winstonewert 10y ago

What if the widget-makers are teenagers who are working their first job? They don't need to support themselves by their labor yet. I think there is some room for these kinds of jobs. Obviously, when adults are trying to support themselves with this kind of job, we have a problem.

Consultant32452 10y ago
Only 24% of minimum wage workers are teenagers. http://www.pewresearch.org/fact-tank/2014/09/08/who-makes-minimum-wage/ http://www.pewresearch.org/fact-tank/2014/09/08/who-makes-mi... That mans 76% are 20+.
undersuit 10y ago
Why is that a problem? The teen, not having to support themselves, has an advantage over the self-supporting individual, they can accept lower wages. In return the company has a choice, to employ teenagers for less money and dealing with the consequences that they are part time or seasonal, or to employ the individual that demands a living wage for themselves and dealing with the consequences that they are full-time and rather permanent.
- winstonewert 10y ago
  I don't think it is a problem. My point was that not every job needs to pay a living wage.