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Economists who defend disaster profiteers are wrong

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Re: Economists who defend disaster profiteers are wrong

#201

Post by tomp »

hannasanarion wrote: post #64
megous wrote: post #54

Earlier quoted context omitted.

While true, that doesn't really matter. Higher price attracts new producers to setup manfuacture for the now scarce and expensive product more quickly. These more wealthy buyers just end up paying for a quick rampup in manufacture. There's 0 financial reason to ramp up supply if the price is the same, and you're now suddenly in a heavily controlled market. It's risky by itself to ramp up production, because you may e…

If ramping up production were as simple as hiring 100 more people, it would have been done even if there weren't a crisis. Capacity for manufacture is not infinite and it cannot be changed at a moments notice. It takes months or years to establish supply chains, facilities, machinery, and expertise needed to increase manufacture, and by that time the crisis is over and the extra demand is gone.

How do you know that? What if there was a factory running at less than 100% physically capacity? You could in theory ramp up production very quickly simply by hiring more people, but you won’t, because doing so incures costs (training them, giving them PPE, ...) and you can’t be sure about your income (price rises are banned, exporting is outlawed, your product might even be confiscated).

Re: Economists who defend disaster profiteers are wrong

#202

Post by dragonwriter »

adjkant wrote: post #161
dragonwriter wrote: post #147

Earlier quoted context omitted.

> Minimum wage does not price people out of jobs, Yes, it quite obviously does. > it puts a cap on the profit that a corporation can squeeze out of its workers. No, it doesn't. Competition does that. Minimum wage puts a floor on the economic value of labor that can get hired at all. It might limit value extraction where there is a monopsony purchaser of labor who is not also a monopoly supplier of the good produced w…

> No, it doesn't. Competition can also do it, but idk how that eliminates minimum wage from doing it. Neither raises revenue, both simply put pressure on profit margins. The only difference is one is regulation, the other is market force. > It might limit value extraction where there is a monopsony purchaser of labor who is not also a monopoly supplier of the good produced with that labor, but that's not actually all…

> Competition can also do it, but idk how that eliminates minimum wage from doing it.

Minimum wage only potentially does it for a narrow range of work with actual economic value that is between the minimum wage and a small multiple of it, and only for jobs where there isn't effective competition for labor (because effective competition for labor already does it as much as is possible, leaving nothing for minimum wage to do), and always has the cost, whether or not the conditions exist to provide the benefits, of making impossible all wage labor with an actual economic value less than the minimum wage, which not only kills jobs, but prevents upward mobility from the experience people would gain in those lower-value jobs.

> Minimum wage is fully pragmatic to me, not an ideal. It's a net positive compared to the current situation.

Minimum wage + means- and behavior-tested public benefit programs is the current situation.

Re: Economists who defend disaster profiteers are wrong

#203

Post by [deleted] »

AnthonyMouse wrote: post #118
jimmaswell wrote: post #75

Earlier quoted context omitted.

And a lot of people would just have to go without, As opposed to everyone getting a little with price controlled rationing.

I think this is the biggest flaw in your argument. If toilet paper was $20/roll, that wouldn't deter someone who has none in the slightest bit. They'd buy one roll and pay $20 in a second. But that guy who was trying to buy a thousand? He's thinking twice.

[deleted]

Re: Economists who defend disaster profiteers are wrong

#204

Post by [deleted] »

alexmingoia wrote: post #4

Increased production doesn’t occur because the economics don’t work, it doesn’t occur because there’s just no way to physically ramp up production that fast. That’s not really a critique of the economics. If production could be increased that fast the manufacturers would. An important point the article didn’t address is that high prices direct resources to more important uses. If prices are very high then hospitals m…

[deleted]

Re: Economists who defend disaster profiteers are wrong

#205

Post by imtringued »

barry-cotter wrote: post #114
h0l0cube wrote: post #91

Earlier quoted context omitted.

> And many modern economists endorse a minimum wage, as eugenicists did then, but with even less regard for the harm it causes. What are the harms of a minimum wage? Do you have any empirical sources to back that up?

People whose labor is worth less than the minimum wage become unemployable. Being unemployed means you can’t acquire skills or experience and is bad for your mental health and social attachment. If you want to look at the literature you can start with Card and Krueger, which shows minimal effects for a small minimum wage discontinuity, I believe on the NJ/NY border. The Seattle minimum wage study showed a reduction i…

The problem with minimum wage is that there is no minimum wage guarantee by the state. The same problem applies to price controls of any kind. If nobody is willing to sell you a product that satisfies the price controls then you go home empty handed. If the rules are too strict and end up preventing the market from working then the government is to blame and the government has to step in and actually provide whatever nonsensical guarantee it made.

If the government wants to prevent you from getting a job that pays less than minimum wage it has to provide you with a job that actually does pay minimum wage.

Re: Economists who defend disaster profiteers are wrong

#206

Post by adjkant »

dragonwriter wrote: post #202
adjkant wrote: post #161

Earlier quoted context omitted.

> No, it doesn't. Competition can also do it, but idk how that eliminates minimum wage from doing it. Neither raises revenue, both simply put pressure on profit margins. The only difference is one is regulation, the other is market force. > It might limit value extraction where there is a monopsony purchaser of labor who is not also a monopoly supplier of the good produced with that labor, but that's not actually all…

> Competition can also do it, but idk how that eliminates minimum wage from doing it. Minimum wage only potentially does it for a narrow range of work with actual economic value that is between the minimum wage and a small multiple of it, and only for jobs where there isn't effective competition for labor (because effective competition for labor already does it as much as is possible, leaving nothing for minimum wage…

Sorry, to clarify, I mean a minimum wage increase generally as a policy. Specifics needed for nuance of course taking into account COL by location and economic climate. Again, I agree UBI via corporate profit taxation would be much more efficient.

> but prevents upward mobility from the experience people would gain in those lower-value jobs

You can see my other threads here but I would love to hear about these jobs with valuable experience that need to pay under any reasonable minimum wage that would not be already existing internship programs. I just can't imagine what these are.

As to the rest, I just don't believe that area is as narrow as you describe.

> jobs where there isn't effective competition for labor

I really don't think you have experienced/have an idea of what it is like to be anywhere near unemployed and "unskilled". Nearly all of retail/warehouse/gig/delivery jobs experience little to no competition since they all go as low as possible and say "take it or leave it" because they know the alternative in unemployment. Competition only exists today really in skilled job markets.

Re: Economists who defend disaster profiteers are wrong

#207

Post by robocat »

paranoidrobot wrote: post #193
AnthonyMouse wrote: post #103

Earlier quoted context omitted.

> A billionaire who wants to stockpile a million masks just in case definitely not "more important" than a million poor people getting 1 mask each. Real people don't behave like this. A billionaire can't make personal use of a million masks and there is no point in stockpiling them during a crisis just in case there is some future crisis. They're not going to be worth more a year from now than they are today because…

> nobody would be buying a million masks to hoard in a bunker right now. No, that's correct, because you can't (profitably) buy a million masks to hoard them right now. If you'd done it on January 1 though, you'd have been able to buy as many masks as you liked. Selling them now? Is this the height of the crisis? Perhaps. > Real people don't behave like this. They do, but most people don't have millions of dollars to…

> This is why I've not seen a roll of toilet paper on shelves in my local supermarkets or stores for three months now

Three months ago was January 14th. Perhaps you are being a mite hyperbolic?

Re: Economists who defend disaster profiteers are wrong

#208

Post by imtringued »

adjkant wrote: post #112
dantheman wrote: post #105

Earlier quoted context omitted.

Minimum wage puts a floor on the amount of value necessary for someone to be employable. Many people, especially those just starting out can't produce that much value.

The irony of this comment is that it is exactly missing the morality in an economic situation, the claim being that if you are capable of work and are trying your best, you deserve to have enough pay to live off of. Minimum wage does not price people out of jobs, it puts a cap on the profit that a corporation can squeeze out of its workers. Employers who would be paying under it are simply not viable moral businesses…

I think you misunderstand what a minimum wage does. A minimum wage doesn't increase the bargaining power of an employee. It means the employee has to have a minimum amount of bargaining power to get hired in the first place. It doesn't actually prevent any exploitation. Imagine you are an exploited worker. You hate your boss, your job and the pay sucks. Do you really need a minimum wage law to be allowed to leave the job? No, you can just quit at any time. If you already had enough bargaining power you didn't need the minimum wage in the first place.

A minimum wage does absolutely nothing. It's like the British Queen: a political symbol that you can talk about.

If it actually did something then you wouldn't choose a low limit. You'd increase it to $100/hour but then you realize something. Even your well paid software developer job is at risk of being stomped by the minimum wage.

Re: Economists who defend disaster profiteers are wrong

#209

Post by speleding »

alexmingoia wrote: post #4

Increased production doesn’t occur because the economics don’t work, it doesn’t occur because there’s just no way to physically ramp up production that fast. That’s not really a critique of the economics. If production could be increased that fast the manufacturers would. An important point the article didn’t address is that high prices direct resources to more important uses. If prices are very high then hospitals m…

Another point the article misses is that time limited price increases are a good way to dis-incentivise hoarders: "This week only, toilet paper is 100% more expensive".

To me that seems like a very reasonable policy to make sure people who need it can still get it, while at the same time sending a strong signal to only buy as much as you need. That the seller profits from the policy is just a side effect.

Re: Economists who defend disaster profiteers are wrong

#210

Post by adjkant »

imtringued wrote: post #208
adjkant wrote: post #112

Earlier quoted context omitted.

The irony of this comment is that it is exactly missing the morality in an economic situation, the claim being that if you are capable of work and are trying your best, you deserve to have enough pay to live off of. Minimum wage does not price people out of jobs, it puts a cap on the profit that a corporation can squeeze out of its workers. Employers who would be paying under it are simply not viable moral businesses…

I think you misunderstand what a minimum wage does. A minimum wage doesn't increase the bargaining power of an employee. It means the employee has to have a minimum amount of bargaining power to get hired in the first place. It doesn't actually prevent any exploitation. Imagine you are an exploited worker. You hate your boss, your job and the pay sucks. Do you really need a minimum wage law to be allowed to leave the…

I never said it increased the bargaining power of an employee. A minimum wage ensures that employees are paid enough to survive at a human level.

I think you misunderstand my use of the word "exploit" here. The underpayment is the exploitation, not work conditions here. I'm not sure where someone wanting to quit their job factors into my argument.

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