4 ms·
What about an enterprise in economic balance, making nearly zero profit because it shared surplus revenue with the workers, even after all of the interest payme
by redcobra762 3y ago
What about an enterprise in economic balance, making nearly zero profit because it shared surplus revenue with the workers, even after all of the interest payments on the loans given out by the investors (can’t forget the investors, of course)?
- robertlagrant 3y agoThat's still profit. It's just the profit is paid as dividends to workers.
- redcobra762 3y agoThat would actually be an expense, reducing profits by intentionally increasing labor costs. In economic terms profit would be reduced.
- robertlagrant 3y agoNo, not if it's dividends, as I mentioned. Dividends are paid out of profits.
- redcobra762 3y agoBut it's not dividends, it's increased salary, so it's still not net profit, it's pre-operational profit, which nobody looks at due to the importance of paying for labor.
- robertlagrant 3y agoI said this: > That's still profit. It's just the profit is paid as dividends to workers. How is that not dividends?
- redcobra762 3y agoBecause dividends are payed to shareholders, not for labor. It’s not net profit if it’s not accounting for the cost of labor.
- robertlagrant 3y agoWorkers can have shares in a business, which is the hypothetical I was going for originally.
- spacebanana7 3y agoI would describe such an enterprise as profit making, if the sharing is truly voluntary. The persistent existence of surplus revenue implies the excess of resource production over resource consumption i.e profit. However, if this sharing is involuntary it's likely the true cost of labour is higher it first appears. For example, bankers' bonuses and engineers' stock options are important parts of labour cost for the relevant enterprises.
- s1artibartfast 3y agoThere can be multiple balance points. In the one you describe, then the employees would profit more, unless they too have minimum costs equal to revenue. Fortunately, humans have real minimum operational costs close to zero, and can live for a long time off a handful of dollars a day.