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An alternative would be the company taking money from their profits and using it to pay people a living wage. The argument against that I usually hear is that

An alternative would be the company taking money from their profits and using it to pay people a living wage. The argument against that I usually hear is that companies pay people based on what "the market" says their labor is worth and the employees should just get a better job if they don't like it. However, my understanding is that such analysis is based on models which assume that the people involved are rational actors. That creates a contradiction: If the employees are not rational actors then the model's assumptions are not valid. However, if they are rational actors, then the argument that they should just get a better job isn't valid because a rational actor would have already done so.

sokoloff 8y ago
> if they are rational actors, then the argument that they should just get a better job isn't valid because a rational actor would have already done so. If they are rational actors, why isn't the argument that their revealed preferences say that they like it "enough" to accept the bargain offered them? I tend towards the rational actor side of the debate and that they are satisfied that the bargain offered is their best option, so they (rationally) take it.
- harimau777 8y ago
  I agree that it is likely the best option available to them. My issue is with the argument that "if they don't like it they can get a different job" and therefore it is morally justified for people to be payed a sub-living wage. I'm not saying that the parent post is necessarily making that argument, just that it seems like thats the usual justification for this sort of thing.
EliRivers 8y ago
Indeed, "the market". Like its some kind of God, and to obey its whims is morally correct. Maybe it is what "the market" wants, but maybe society has different preferences. We routinely choose to override the market's decisions, and we can do so here as well.
- linuxftw 8y ago
  The market is distorted by the government. Smaller, independent companies cannot compete with foreign slave labor. Low tariffs and high domestic taxes is a recipe for large corporations consolidating the supply chain in every industry. Low wages are a symptom of government control, no other reason.
  - EliRivers 8y ago
    Low wages are a symptom of government control, no other reason. In a "true" free-market, whatever that is, there would be no low wages? This seems counter-intuitive. Do you have any evidence or reasoning for this?

sokoloff 8y ago

> if they are rational actors, then the argument that they should just get a better job isn't valid because a rational actor would have already done so. If they are rational actors, why isn't the argument that their revealed preferences say that they like it "enough" to accept the bargain offered them? I tend towards the rational actor side of the debate and that they are satisfied that the bargain offered is their best option, so they (rationally) take it.

harimau777 8y ago
I agree that it is likely the best option available to them. My issue is with the argument that "if they don't like it they can get a different job" and therefore it is morally justified for people to be payed a sub-living wage. I'm not saying that the parent post is necessarily making that argument, just that it seems like thats the usual justification for this sort of thing.

EliRivers 8y ago

Indeed, "the market". Like its some kind of God, and to obey its whims is morally correct. Maybe it is what "the market" wants, but maybe society has different preferences. We routinely choose to override the market's decisions, and we can do so here as well.

linuxftw 8y ago
The market is distorted by the government. Smaller, independent companies cannot compete with foreign slave labor. Low tariffs and high domestic taxes is a recipe for large corporations consolidating the supply chain in every industry. Low wages are a symptom of government control, no other reason.
- EliRivers 8y ago
  Low wages are a symptom of government control, no other reason. In a "true" free-market, whatever that is, there would be no low wages? This seems counter-intuitive. Do you have any evidence or reasoning for this?