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This is more evidence that the market clearing price for labor is irrational and inefficient. Most workers are not compensated for (a) the surplus value they g
by rmrfstar 6y ago
This is more evidence that the market clearing price for labor is irrational and inefficient.
Most workers are not compensated for (a) the surplus value they generate, or (b) the risk they bear in work activities.
This article goes to point (b). Point (a) is evident in [1], and is far more problematic as it leads to consolidated control over resources (physical and the ability to direct the daily activities of others).
[1] https://onlinelibrary.wiley.com/doi/abs/10.1111/jofi.12909 https://onlinelibrary.wiley.com/doi/abs/10.1111/jofi.12909
- ativzzz 6y agoI would argue that market rationality and efficiency described in economics textbooks does not exist, nor has ever existed.
- smabie 6y agoThen it should be pretty easy to make a ton of money in the market, no? What's great about finance is that if you believe there are persistent inefficiencies in the market, you can put your money where you mouth is and exploit them. As market participants might tell you though, the market is much more efficient than you might expect. But let's talk more about the efficient market hypothesis (EMH). Many have the misunderstanding that EMH is some sort of axiom that people actually believe. No one actually believes it to be literally true, but without EMH as a guiding principle, modern finance could not exist. The actions of many market participants creates the mostly/sometimes efficient market we have today. Put another way, in order for a market to be efficient, it needs participants who are arbitraging away the inefficiency. But because they are profiting off the (temporary) inefficiency, clearly the market isn't efficient!