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> How are both of these true? If a job pays poorly, doesn't that suggest there are many people willing and able to do those jobs, relative to the need for the j

> How are both of these true? If a job pays poorly, doesn't that suggest there are many people willing and able to do those jobs, relative to the need for the job to be done? Or it suggests that labor doesn't flow through the system as easily as the theory assumes it does, or that the theory assumes incorrect things about the world, or that it's just wrong on the face of it in a whole lot of actual real world cases. As the biologists say, it's usually not the lab mouse who's wrong.

rahimnathwani 5y ago
Yes, definitely, there might be an alternate explanation that's closer to reality, than what I proposed. Any ideas?
- roughly 5y ago
  Well, at a first pass: Labor market negotiating power is unbalanced; owners of capital are loathe to give it away under any circumstances; workers, especially poor workers, don't have a lot of flexibility to shop around for jobs when they need one; and by and large modern business thinking & planning is incredibly short-term and liable to walk itself into stupid and avoidable situations like not being able to stock shelves with toilet paper for six months or sell $30k cars for lack of $5 worth of old computer chips. Basically, you've got a pile of short-sighted, emotional apes, often operating under conditions of stress or duress, with imperfect information and a planning system that's effectively hijacking stress responses designed to respond to actual flesh & blood predators to evaluate interest rates. All that indicates to me that the cohabitation of "we can't find workers" and "no, we're not raising wages" is maybe less surprising than theory would suggest. Specific to what's happening in the farm labor market, I'd suspect there's a lot of interplay between the immigration system being pretty broken and farm owners being on the whole kind of crappy businessmen that leads to this particular market distortion.
  - rahimnathwani 5y ago
    It seems like the explanation you're putting forward is: farm owners are suffering from too few farm workers but, because they are bad businesspeople, they don't realize that raising offered wages would allow them to hire enough people. Have I understood correctly?

rahimnathwani 5y ago

Yes, definitely, there might be an alternate explanation that's closer to reality, than what I proposed. Any ideas?

roughly 5y ago
Well, at a first pass: Labor market negotiating power is unbalanced; owners of capital are loathe to give it away under any circumstances; workers, especially poor workers, don't have a lot of flexibility to shop around for jobs when they need one; and by and large modern business thinking & planning is incredibly short-term and liable to walk itself into stupid and avoidable situations like not being able to stock shelves with toilet paper for six months or sell $30k cars for lack of $5 worth of old computer chips. Basically, you've got a pile of short-sighted, emotional apes, often operating under conditions of stress or duress, with imperfect information and a planning system that's effectively hijacking stress responses designed to respond to actual flesh & blood predators to evaluate interest rates. All that indicates to me that the cohabitation of "we can't find workers" and "no, we're not raising wages" is maybe less surprising than theory would suggest. Specific to what's happening in the farm labor market, I'd suspect there's a lot of interplay between the immigration system being pretty broken and farm owners being on the whole kind of crappy businessmen that leads to this particular market distortion.
- rahimnathwani 5y ago
  It seems like the explanation you're putting forward is: farm owners are suffering from too few farm workers but, because they are bad businesspeople, they don't realize that raising offered wages would allow them to hire enough people. Have I understood correctly?