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> It's pretty basic economics that says wages are based on productivity. This is a nice idea that plays to the human sense of fairness, but wages have been com
by mullingitover 4y ago
> It's pretty basic economics that says wages are based on productivity.
This is a nice idea that plays to the human sense of fairness, but wages have been completely decoupled from productivity for about the last four decades[1].
The only thing that really raises wages is the market power of laborers. Wages have stagnated or fallen as the market power of labor has eroded.
[1] https://hbr.org/2015/06/the-great-decoupling https://hbr.org/2015/06/the-great-decoupling
- bko 4y agoYou're looking at aggregate values. And there's a lot going on including benefits. It's hard to tease out. But use common sense. It's not about fairness. If you had a goose that lays golden eggs that you can sell for $100 net of costs. You'd pay up to $100 for the goose. If suddenly it started producing double the eggs you'd pay up to $200 or someone else would outbid you. The only way the goose wouldn't be able to get a higher salary is if competitors were not greedy as it's basically free money and just let the current owner profit from the goose's productivity gain
- deleted 4y ago[deleted]
- mullingitover 4y ago> If suddenly it started producing double the eggs you'd pay up to $200 or someone else would outbid you. This makes a lot of assumptions about the market being perfectly competitive, which is a bit of a stretch. The past four decades have been marked by consolidation and reduction of competition, and the largest firms have profit margins that aren't at all indicative of healthy competition.