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Usually this is because customers have gotten used to paying less than reasonable prices. Paying people more is often hand in hand with customers paying more. B

Usually this is because customers have gotten used to paying less than reasonable prices. Paying people more is often hand in hand with customers paying more. But people like the first idea more than the second! Companies will try to only pay staff more when they can justify that to the shareholders as being a way to make more money for the shareholders. A public company exists solely for the benefit of the shareholders and all actions stem from that.

mooreds 8y ago
> A public company exists solely for the benefit of the shareholders and all actions stem from that. Not sure about this. First off, there's the principal/agent problem that causes many public companies to be run for the benefit of their upper management. Second, this idea of the shareholder above all other stakeholders is a new phenomenon (since the 1980s). It's also primarily an Anglo Saxon idea (USA, Britain). Other countries include other stakeholders more explicitly. And the USA could as well, of the political will was there. I agree with you that this is how American capitalism is structured now, but it didn't spring from the mind of God, it's a human institution that can be changed.
- jsmith45 8y ago
  Yeah. I've often said that in any business decisions there are the following stakeholders: Upper Management, The employees, the board members, the shareholders, the customers. Business decisions are almost always made looking at the perspective of perhaps 2 or three of these stakeholders. The employees are basically never considered in the US, often only the biggest one or two customer's desires are considered if any consideration is given at all, etc. And way too much attention is payed to certain Wall Street types who get all upset when earnings exceed the company's own projections, but fall short of wildly optimistic estimates by third parties.

mooreds 8y ago

> A public company exists solely for the benefit of the shareholders and all actions stem from that. Not sure about this. First off, there's the principal/agent problem that causes many public companies to be run for the benefit of their upper management. Second, this idea of the shareholder above all other stakeholders is a new phenomenon (since the 1980s). It's also primarily an Anglo Saxon idea (USA, Britain). Other countries include other stakeholders more explicitly. And the USA could as well, of the political will was there. I agree with you that this is how American capitalism is structured now, but it didn't spring from the mind of God, it's a human institution that can be changed.

jsmith45 8y ago
Yeah. I've often said that in any business decisions there are the following stakeholders: Upper Management, The employees, the board members, the shareholders, the customers. Business decisions are almost always made looking at the perspective of perhaps 2 or three of these stakeholders. The employees are basically never considered in the US, often only the biggest one or two customer's desires are considered if any consideration is given at all, etc. And way too much attention is payed to certain Wall Street types who get all upset when earnings exceed the company's own projections, but fall short of wildly optimistic estimates by third parties.