3 ms·

This logic would suggest that all increases in population (labor supply) in the history of humanity should be pushing labor down, because more people are compet

This logic would suggest that all increases in population (labor supply) in the history of humanity should be pushing labor down, because more people are competing for jobs. This is obviously, clearly wrong. Re-read what you responded to, especially the part about the longer term effect of increased consumption and GDP from higher participation rates. What you say is only true in a very short-term, micro view (labor supply in a small town over a matter of days, for example), not in the macro timeframe that is the context of this discussion. This is a well-studied area of economics and the field is not in consensus with your statement.

saurik 6y ago
You can't conflate population and labor supply as the specific scenarios being discussed are cases where population was fixed but labor supply changed anyway: like, the reason increased population is different should be obvious... you also have more consumers (and yet, amazingly, the average wages stay the same while total output goes up, per the comment by someone else, as that is also comparing two incomparable things); but, if you do something where consumption is the same but competing labor force goes up, that allows you to isolate the two effects. (FWIW, I have no skin in any of the rest of this position, so please do make another argument against it: it is just that your statement that it is "obviously, clearly wrong" is itself "obviously, clearly wrong" as it is at best arguing against a straw man of what other people are saying.)
fxtentacle 6y ago
Your fallacy here is to assume that the per-capita income growth is affecting the same people as the increased job competition. 2x the people might mean 2x the revenue for Amazon, but there is no guarantee that it'll trickle down. Maybe Amazon can, due to automation, satisfy the 2x in demand with only 1.9x in manual labor. In that case, work supply and consumption both grow by 2x. But salaries for the workes will go down while salaries for Amazon management go up. So the total salary average might remain the same, but it'll increase inequality nonetheless.

saurik 6y ago

You can't conflate population and labor supply as the specific scenarios being discussed are cases where population was fixed but labor supply changed anyway: like, the reason increased population is different should be obvious... you also have more consumers (and yet, amazingly, the average wages stay the same while total output goes up, per the comment by someone else, as that is also comparing two incomparable things); but, if you do something where consumption is the same but competing labor force goes up, that allows you to isolate the two effects. (FWIW, I have no skin in any of the rest of this position, so please do make another argument against it: it is just that your statement that it is "obviously, clearly wrong" is itself "obviously, clearly wrong" as it is at best arguing against a straw man of what other people are saying.)

fxtentacle 6y ago

Your fallacy here is to assume that the per-capita income growth is affecting the same people as the increased job competition. 2x the people might mean 2x the revenue for Amazon, but there is no guarantee that it'll trickle down. Maybe Amazon can, due to automation, satisfy the 2x in demand with only 1.9x in manual labor. In that case, work supply and consumption both grow by 2x. But salaries for the workes will go down while salaries for Amazon management go up. So the total salary average might remain the same, but it'll increase inequality nonetheless.