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> the worker Yes, the hypothetical singular worker. In reality, there are many workers, all willing to undercut each other in a race to the bottom. Competitio
by gnode 8y ago
> the worker
Yes, the hypothetical singular worker. In reality, there are many workers, all willing to undercut each other in a race to the bottom.
Competition has a tendency to force suppliers to supply at as low a price as possible without going out of business, making close to no profit. In the case of the labour supply, when fungible workers compete freely, "as low as possible" means not immediately dying, and no profit means no liberty and no prosperity. In the worst case, the supply is at even lower cost than keeping the worker alive, and the state makes up the difference.
- dexen 7y ago>the employer Yes, the singular employer. In reality, there are many employers, all willing to out-bid each other in a race to the top. Lack of competition among employers has a tendency to let labor buyers to supply as low wages as they can get away with before violence breaks out. We know that from plenitude of historical cases - in soviet & communist countries there was one and only one decider of employment conditions (the state), and negotiations were conducted via street protests. If at all. The key difference is that in capitalism productivity is held reasonably high, and at least some people make good penny. They in turn spend it on goods and services, providing for other people. There is a long tail effect of the whole society gradually becoming wealthier. Meanwhile in soviet and communist countries productivity is low - joys of central planning and lack of meaningful competition - and people stay perpetually impoverished, equal in misery.