4 ms·
> then productivity would be higher in other jobs, which would increase pay for their example jobs due to the Baumol effect. Laughing hard here. You just inven
by jiofih 7y ago
> then productivity would be higher in other jobs, which would increase pay for their example jobs due to the Baumol effect.
Laughing hard here. You just invented “trickle-down pay raises”!
If everybody has a degree, the degree doesn’t matter anymore, does it? Being a bachelor of economics will not make you a better burger deliverer. Plus the effect only hold due to a few sectors like IT paying disproportionately - overall, productivity increases over the last 70 years have not been reflected in purchasing power or work hours. The gains disappear into the upper deck.
We need to stop this bullshit mentality that people need to ‘educate themselves more’ to earn a decent living. The shit jobs will always exist, and they should pay well just for being shit jobs, which is what happens in northern Europe where minimum wages are more than enough to live comfortably as a bartender. There should be absolutely no shame in working for McDonalds (except about the food itself).
- Rerarom 7y agoOf course degrees matter. Knowledge creates productivity, which creates wealth.
- jiofih 7y agoYou’re taking that sentence as an absolute, not in the context of low-wage jobs. And it it is a liberal fantasy, right next to meritocracy. That wealth stays put exactly where it is, at the top of the chain. All studies on labor show productivity gains far outpacing salaries in the past century. A well-paid knowledge worker today can barely meet the lifestyle of his factory worker grandparents.
- ikeboy 7y agohttps://files.stlouisfed.org/files/htdocs/publications/es/07/ES0707.pdf https://files.stlouisfed.org/files/htdocs/publications/es/07... This is the result Google currently features for "productivity effect on wages". The chart shows total compensation tracking productivity very closely, although it only goes back a quarter century.
- deiznof 7y agoThis is only because America has incredibly bloated healthcare costs - that "compensation" mostly isn't all that valuable. A $1000 slice of pizza is still only 1 slice of pizza.
- ikeboy 7y ago>Being a bachelor of economics will not make you a better burger deliverer. No one said it did. But if your other option is something that's more productive, then the only way you'll agree to deliver burgers is if you're paid as much as the alternative. This has been known for half a century. https://en.wikipedia.org/wiki/Baumol%27s_cost_disease https://en.wikipedia.org/wiki/Baumol%27s_cost_disease Pay rises in industries without productivity increases to match those in industries with productivity increases because of competition. Of course, this is in the hypothetical where everyone has a college degree and assuming that the value of a degree is in human capital, which I pointed out explicitly was something I'm assuming.
- ikeboy 7y agohttps://fred.stlouisfed.org/series/AVHWPEUSA065NRUG https://fred.stlouisfed.org/series/AVHWPEUSA065NRUG Here's hours worked, shows a clear decline over time.