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Supply and Demand Does a Poor Job of Explaining Depressed Wages

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Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#51

Post by iovrthoughtthis »

andrewla wrote: post #45
coldtea wrote: post #10

The world is not driven by economics (and its simplistic assumptions), it's driven by power relations and human nature. Supply and demand is not the only thing to influence the job market -- power and knowledge asymmetries can do the same thing just as well.

I think this is getting into map vs. territory issues. This is certainly the domain of economics -- the particular simplifying model used by many economists does not appear to paint a complete picture. By analogy, adapting a James Morrow quote: "Economics does have all the answers. The problem is that we don’t have all the economics". Power and knowledge asymmetries are well within the domain that economics tries to…

Great use of map vs territory.

Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#54

Post by TheAdamAndChe »

sprash wrote: post #24

Supply and demand does a great job of explaining depressed wages. We had two kinds supply shocks in the recent history in the labor market. One is women entering the workforce and the second is mass immigration. Both coincided at the end of the 60s and 70s. Exactly since then wages are not correlated to productivity anymore and are basically stagnating.

Globalization occurred during this time, too, leading to a greater concentration of wealth in the cities.

Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#55

Post by dragonwriter »

coldtea wrote: post #43
gowld wrote: post #26

Earlier quoted context omitted.

What is the difference between economics and power relations? Human nature I understand -- people have mental/emotional shortcuts that are not precise and accurate rational analysis.

> What is the difference between economics and power relations? In an ideal world, economics would study power relations as they relate to money -- that's what the old economists (19th century and so) called "political economy". In the present world, economics are a shallow ideology around the "free market", with naive abstractions and axioms. Usually these are mostly peddled by the media and "popularizer" economists…

> In an ideal world, economics would study power relations as they relate to money -- that's what the old economists (19th century and so) called "political economy".

“Money” is overly restrictive, it's really all goods and services, and the old “political economy” is a substantial part of what eventually became the field of “political science”. It may not still be considered mainly in the scope of Economics departments, but then what used to be called “natural philosophy, while still studied, isn't part of scope of the Philosophy department.

Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#56

Post by andrewla »

andy_ppp wrote: post #8
readams wrote: post #5

It should be pointed out that studies of small increases of minimum wage that show modest harm do not immediately tell us that huge increases of minimum wage will not cause greater harm. Remember that $15/hour is more than the median wage in much of the country.

These jobs that are worth less than $15 per hour are going to be the first to be replaced by machines so whatever happens we need a solution to give people at the bottom high(er) quality lives.

I think this might be a misplaced assumption.

Historically I think it has turned out that machines/computers are really good at jobs that people think are hard, but really bad at jobs that people think are easy.

Machines are great at doing precision machining, which is hard for humans. But they're terrible at walking, which most people can do without difficulty.

Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#57

Post by comstar »

toomuchtodo wrote: post #20
andy_ppp wrote: post #8

Earlier quoted context omitted.

These jobs that are worth less than $15 per hour are going to be the first to be replaced by machines so whatever happens we need a solution to give people at the bottom high(er) quality lives.

> we need a solution to give people at the bottom high(er) quality lives. Training and safety nets, funded through tax revenues. Keep in mind, the national minimum wage in Australia is currently $18.29. The entire US has been getting a discount on minimum wage labor for decades, and everyone is kicking and screaming now that those workers are having their wages ratcheted up to what they should be making when accounti…

Not to discredit anything you've said, as on the whole I agree with you. But movie tickets are nearly twice as expensive in Australia. [0] [1]

And a popular videogame can be wildly more expensive. MLB The Show 2018 for instance is $60 in the US and $100 in AU. These prices are outside that which is explained by the current exchange rate.

Yes, you are being paid more. The price of living is also drastically higher there. I think there are better case-studies than Australia.

[0] https://www.screenaustralia.gov.au/fact-finders/cinema/indus...

[1] https://www.statista.com/statistics/187091/average-ticket-pr...

Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#58

Post by anubisresources »

coldtea wrote: post #43
gowld wrote: post #26

Earlier quoted context omitted.

What is the difference between economics and power relations? Human nature I understand -- people have mental/emotional shortcuts that are not precise and accurate rational analysis.

> What is the difference between economics and power relations? In an ideal world, economics would study power relations as they relate to money -- that's what the old economists (19th century and so) called "political economy". In the present world, economics are a shallow ideology around the "free market", with naive abstractions and axioms. Usually these are mostly peddled by the media and "popularizer" economists…

What economics courses have you taken that are remotely like this? Economics is extremely quantitative and is not some “shallow ideology”.

Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#59

Post by nightski »

crabasa wrote: post #44
andrewla wrote: post #42

Earlier quoted context omitted.

I feel comfortable saying, without evidence, that LinkedIn is unlikely to be useful for workers living at the border of the minimum wage, or in general workers who would be likely to be affected directly by a change in the minimum wage.

I agree with you about the current iteration of LinkedIn. But that doesn't mean a different kind of product, focused on professional development, career management and networking couldn't be useful for folks. I imagine that many people simply leverage Facebook, Twitter and other social networks for this today, in the absence of something for purpose-built.

This probably won't be a popular viewpoint, but I personally prefer the decentralized messy version of networking we mostly experience today vs. one big monolith that facilitates all relationships.

Re: Supply and Demand Does a Poor Job of Explaining Depressed Wages

#60

Post by peoplewindow »

cortesoft wrote: post #13
randyrand wrote: post #4

Earlier quoted context omitted.

....which is dictated my the supply of employers thanks for the tldr.

Except it isn’t, it because of the way labor and employers have different costs when an employee leaves, meaning each side has a different equation for how important it is to not sever the employment arrangement. If an employee loses their job, they lose 100% of their income, and for many they are unable to survive this. If an employer loses an employee, they only lose 1/n of their production, where n is the number o…

That assumes all employees are equal which in any non-factory-churn-operation company is not going to be true.
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