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One of the key evolutionary characteristics of firms is that they must self-appropriate more value in their network of transactions than they dispense. Their en

by ABCLAW 4y ago

One of the key evolutionary characteristics of firms is that they must self-appropriate more value in their network of transactions than they dispense. Their engagement with labour is no different; if they paid labour more than the value they received for work, they would go out of business. Maybe you're an exception where the firm is losing value or going dead-equal on the deal, but given that firms who habitually do that go out of business, you'd be in a tiny minority. Accordingly the question isn't if you're exploited. It's how much. A firm is going to need to get SOME margin off you - that's fine. But how much is too much? What factors systemically result in them taking too much margin, etc. Having the discussion in those terms allows you to actually interface with the reality of worker/corporate transactions.

throwaway09223 4y ago
Your analysis assumes a zero-sum situation but this simply isn't the case. The intersection of labor and capital is enormously mutually beneficial. Regarding fair allocations of proceeds, one could just as easily argue that labor is exploiting capital, and that capital should take a greater share of profits. In fact, both outcomes are certainly, demonstrably true in different scenarios. In a chapter 11 bankruptcy, capital is lost while wages remain protected. Your argument is in regard to the average outcome, and as such it glosses over the inherent give and take, risk and reward, present in a variable and chaotic -- but undeniably mutually beneficial -- system.
- ABCLAW 4y ago
  You are mistaken, the analysis derives out of one of the core elements of firm theory. It doesn't assume a zero-sum situation at all. There's a lot of literature on 'the analysis', which happens to not be mine. It's actually one of the core elements of neoclassical economics. >one could just as easily argue that labor is exploiting capital No, one couldn't. >In a chapter 11 bankruptcy, capital is lost while wages remain protected. Depending on the jurisdiction, wages are provided a super-priority status. Other super-priority stakeholders are afforded equal protection amongst themselves. Priority stakeholders, such as lenders with security, are provided more protection than unsecured lenders, etc. Protection for missing wages exists solely due to rectifying legislation attempting to address of how disadvantaged a worker is when a business's assets are encumbered and they have no priority. However, when it comes to managing risk, workers have to hope they'll get paid, while a secured lender can request assurances that potential super-priority stakeholders have been paid to determine the amount of exposure they're willing to entertain, and call their loans due in the event covenants and other monitoring systems indicate financial duress. Workers have no equivalent protective system. Honestly most of these points feel like they're relatively uninformed and don't hold up to much scrutiny.
  - throwaway09223 4y ago
    >> In a chapter 11 bankruptcy, capital is lost while wages remain protected. > Depending on the jurisdiction, Cutting through the unnecessary explanation, it appears you agree with me. In general, sometimes capital operates a wage paying business without providing a return to investors. This point is observably true (otherwise a market wouldn't have losers) and I don't think you need to respond to it further.
    - ABCLAW 4y ago
      I don't agree with you at all, for the reasons I've set out. If you stopped reading after hearing that super priorities exist, and believed that their existence was proof that labour regularly defrauds capital, you'd have very much not understood anything. Honestly, almost all of your posts here feel like they're exercises in ignoring content. I'm done.

by ABCLAW 4y ago

throwaway09223 4y ago

Your analysis assumes a zero-sum situation but this simply isn't the case. The intersection of labor and capital is enormously mutually beneficial. Regarding fair allocations of proceeds, one could just as easily argue that labor is exploiting capital, and that capital should take a greater share of profits. In fact, both outcomes are certainly, demonstrably true in different scenarios. In a chapter 11 bankruptcy, capital is lost while wages remain protected. Your argument is in regard to the average outcome, and as such it glosses over the inherent give and take, risk and reward, present in a variable and chaotic -- but undeniably mutually beneficial -- system.

ABCLAW 4y ago
You are mistaken, the analysis derives out of one of the core elements of firm theory. It doesn't assume a zero-sum situation at all. There's a lot of literature on 'the analysis', which happens to not be mine. It's actually one of the core elements of neoclassical economics. >one could just as easily argue that labor is exploiting capital No, one couldn't. >In a chapter 11 bankruptcy, capital is lost while wages remain protected. Depending on the jurisdiction, wages are provided a super-priority status. Other super-priority stakeholders are afforded equal protection amongst themselves. Priority stakeholders, such as lenders with security, are provided more protection than unsecured lenders, etc. Protection for missing wages exists solely due to rectifying legislation attempting to address of how disadvantaged a worker is when a business's assets are encumbered and they have no priority. However, when it comes to managing risk, workers have to hope they'll get paid, while a secured lender can request assurances that potential super-priority stakeholders have been paid to determine the amount of exposure they're willing to entertain, and call their loans due in the event covenants and other monitoring systems indicate financial duress. Workers have no equivalent protective system. Honestly most of these points feel like they're relatively uninformed and don't hold up to much scrutiny.
- throwaway09223 4y ago
  >> In a chapter 11 bankruptcy, capital is lost while wages remain protected. > Depending on the jurisdiction, Cutting through the unnecessary explanation, it appears you agree with me. In general, sometimes capital operates a wage paying business without providing a return to investors. This point is observably true (otherwise a market wouldn't have losers) and I don't think you need to respond to it further.
  - ABCLAW 4y ago
    I don't agree with you at all, for the reasons I've set out. If you stopped reading after hearing that super priorities exist, and believed that their existence was proof that labour regularly defrauds capital, you'd have very much not understood anything. Honestly, almost all of your posts here feel like they're exercises in ignoring content. I'm done.