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That would actually be an expense, reducing profits by intentionally increasing labor costs. In economic terms profit would be reduced.
by redcobra762 3y ago
That 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.