Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
1–10 of 37 posts
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#2The article notes that a greater percentage of national income is going to workers now, which may very well be true according to how the accounting is done. However, how much of that is because many large corporations are booking a great deal of their profits outside of the US, reducing the denominator in kind of an artificial way? I didn't see anything in the article that mentioned the potential effects of corporations booking profits to overseas cost centers.
The chart the NYT shows depicts worker compensation percentage of national income. I'd be interested to see what overall worker compensation and overall corporate profits look like in inflation-adjusted terms, separately.
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#3Awesome. It's great to see that things like the Fight For 15 movement and the anti-collusion lawsuit in tech are having an impact.
As wages and compensation rise, it'll also be an interesting natural experiment to measure how private R&D spending responds. Productivity growth has been historically low these past few years, and only as short a while ago as 2012 or 2013 private R&D as a percentage of GDP was, according to my google-fu, quite low, while now it's higher.
If companies and the government could somewhat coordinate to see that the working-class demand-side of the economy improves its condition while the public and private sector spend money on R&D to improve productivity, the economy could stand a chance of acting remotely healthy some year soon.
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#4Ah the fixed-pie fallacy... A foundational pillar for so much of today's political rhetoric (on the right and left).
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#5The article notes that a greater percentage of national income is going to workers now, which may very well be true according to how the accounting is done. However, how much of that is because many large corporations are booking a great deal of their profits outside of the US, reducing the denominator in kind of an artificial way? I didn't see anything in the article that mentioned the potential effects of corporati…
Another possibility is to look at the compensation for upper management. C-level officers are usually paid in stock as well as cash, but the staff reporting directly to them are salaried employees.
If you actually look at the graph (presented in the same article) it does not look like "the trend is reversing" at all. It rather looks like a very clear downwards trend with a strong cyclic component. So, when the times are good, the salaried bosses might just be handing out productivity bonuses to their reports, and passing the bill to the shareholders.
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#6Ah the fixed-pie fallacy... A foundational pillar for so much of today's political rhetoric (on the right and left).
Many things like land or political power are fixed. So, income inequality really does have downsides even if the pie get's larger. How much is a 3 BR house in an area with good schools near you?
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#7Ah the fixed-pie fallacy... A foundational pillar for so much of today's political rhetoric (on the right and left).
It isn't a fallacy if you have even a basic understanding of economics.
Unfortunately, most of the layman discourse on the internet seems to blindly follow the mantra of an infinitely expanding economy.
While that may be true on an infinite timescale, in the short and medium runs (scale of economic cycles), the pie is indeed fixed.
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#8Ah the fixed-pie fallacy... A foundational pillar for so much of today's political rhetoric (on the right and left).
It's fallacious to assume the contrary. You can transfer billions of dollars of capital in an instant by signing on the dotted line, but it takes decades to create that kind of value. The lumped sum analysis assumption for capital is valid in this case because the rate of capital transfer is many orders of magnitude greater than the rate of capital generation.
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#9The article notes that a greater percentage of national income is going to workers now, which may very well be true according to how the accounting is done. However, how much of that is because many large corporations are booking a great deal of their profits outside of the US, reducing the denominator in kind of an artificial way? I didn't see anything in the article that mentioned the potential effects of corporati…
Another possibility is to look at the compensation for upper management. C-level officers are usually paid in stock as well as cash, but the staff reporting directly to them are salaried employees. If you actually look at the graph (presented in the same article) it does not look like "the trend is reversing" at all. It rather looks like a very clear downwards trend with a strong cyclic component. So, when the times…
Broad measures of wages are also showing growth.
Re: Workers Are Getting a Bit More of the Economic Pie (and Shareholders Less)
#10Ah the fixed-pie fallacy... A foundational pillar for so much of today's political rhetoric (on the right and left).
It isn't a fallacy if you have even a basic understanding of economics. Unfortunately, most of the layman discourse on the internet seems to blindly follow the mantra of an infinitely expanding economy. While that may be true on an infinite timescale, in the short and medium runs (scale of economic cycles), the pie is indeed fixed.
I'm a fellow at one of the largest economic think tanks in the world. I've been studying various schools for 25+ years. I have a basic understanding. "On an infinite timescale"? That is literally meaningless. Show me ANY time scale where the pie has been fixed and I'll go away.