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#51
07-30-2006, 01:51 AM
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Re: Minimum Wage Increase backslash estate tax
[ QUOTE ]
[ QUOTE ] The source of the productivity needs to be examined. If the increase if from the labor being more skilled one would expect the wages to rise. If it is from an increase in capital investment wages could fall. [/ QUOTE ] So wages, even in a competitive market, do not necessarily=marginal productivity. It depends at least in part on the bargaining power of each party, as political economists have long been aware of. Neoclassical economics, as far as I know, still assumes away power, greatly decreasing its veracity and usefulness. [/ QUOTE ] Wages will be equal to the margin productivity of labor. My statement you quoted was in responce to wages versus average productivity of labor over time. Increased labor "skill" leads to increased wages; however, technological advances leads to a higher return to capital. Today is the first I have thoguth about any of this stuff in the last 10 years, so I am not current with recent studies etc. Assuming away the bargaining power does not make the model less useful. Economic models tend to be ordinal in nature, not cardinal. The relationships that they suggest will be accurate, when you start trying to put numbers on things you can be off. The things that are assumed away CAN be modeled, it is just that there ususally isn't much to be gained. Just to further clarify I am not and never was an expert in this area of econ, I studied industrial organizatio and game theory at the graduate level. My master's thesis was title "Exploitation of Labor in the Major League Baseball Market." MLB provides a good model of the monopsonistic conditions that much exist to pay labor less than what it is worth. 
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#52
07-30-2006, 02:46 AM
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Re: Minimum Wage Increase backslash estate tax
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This might work, if other firms knew what the marginal productivity of other workers was. Which of course they do not. [/ QUOTE ] 1. They don't know "perfectly", of course, but its not as if they're supposed to know a priori. They come to know such thing sthrough the market itself. 2. Even if what you said was true, corporations would still have MUCH better knowledge than any government could hope to have.
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#54
07-30-2006, 09:18 AM
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Re: Minimum Wage Increase backslash estate tax
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You don't think this is true? Give an example of a situation where someone produces something of more value than he is paid. [/ QUOTE ] I have worked in several industries where we tender labour in man hours. Typicaly what we would charge the client for labour would be 4-6x times what we paid the labour.
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#55
07-30-2006, 09:26 AM
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Re: Minimum Wage Increase backslash estate tax
[ QUOTE ]
[ QUOTE ] You don't think this is true? Give an example of a situation where someone produces something of more value than he is paid. [/ QUOTE ] I have worked in several industries where we tender labour in man hours. Typicaly what we would charge the client for labour would be 4-6x times what we paid the labour. [/ QUOTE ] And what the client was charged soley paid for these workers. Your worker did not add what the client paid for the labor to your bottomd line because there would have been some other laborer to work in his spot. To Figure the fair wage you have to look at how much less your compnay would have made without that last worker. If there was some other worker idled during that time that would have gone in his place he didn't generate much at all for your company. He still generated something for the client which was indicated by the clients willingness to pay. And yes the real formula to reach the marginal productivity you do need to add salary, benefits, etc together. This doesn't change the fact that if employees are bringing in more than they cost that the busines would hire more employees.
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#56
07-30-2006, 10:22 AM
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Re: Minimum Wage Increase backslash estate tax
The estate tax is far more obscene then the minimum wage "problem." I am not even sure why inheritance should be taxed in the first place. If i die and want my children to get money that shouldn't be the territory of the government in my opinion.
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#57
07-30-2006, 10:39 AM
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Re: Minimum Wage Increase backslash estate tax
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The estate tax is far more obscene then the minimum wage "problem." I am not even sure why inheritance should be taxed in the first place. If i die and want my children to get money that shouldn't be the territory of the government in my opinion. [/ QUOTE ] I agree with this as there just aren't very many people whose labor is so unskilled that they aren't already over the min wage. I know very little abotu the estate tax other than it doesn't seem fair to me, but I have never studied it.
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#58
07-30-2006, 10:48 AM
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Re: Minimum Wage Increase backslash estate tax
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The government can provide countervailing power to help out the less fortunate, and should. [/ QUOTE ] Sure it's fine to help others out, but the government is helping them out by taking business's property to fund it. Why is this OK to you? Ever here of charity, unions, or boycotts? [ QUOTE ] The guy working at Mcdonald's for minimum wage is doing it because he lacks options, not because he prefers being a clerk to being an MLB slugger or the multi-millionaire CEO of a corporation. [/ QUOTE ] How do you know he doesn't have options? Plently poor people have worked hard and gotten out of poverty. What was the difference between them and the guy at McDonalds working for minimum wage? [ QUOTE ] And the pro-minimum wage crowd does not believe that some people should pay decent wages, or that the less powerful should have to engage in a costly and risky struggle to get a decent wage. [/ QUOTE ] Do you believe anyone should work hard for anything believed to be important? Why are charity, unions or boycotting "costly and risky" to people. Bob owns his business. Jane works for X/hour. Steve comes in to his business and threatens Bob that he must pay Jane >X/hr. What right does Steve have to tell Bob to either lose money or fire Jane? Does the fact that 51% of a certain population like Steve (an election that may or may not be valid mind you) make Steve the unquestioned authority to infringe on others rights?
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#59
07-30-2006, 02:14 PM
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Re: Minimum Wage Increase backslash estate tax
[ QUOTE ]
The estate tax is far more obscene then the minimum wage "problem." I am not even sure why inheritance should be taxed in the first place. If i die and want my children to get money that shouldn't be the territory of the government in my opinion. [/ QUOTE ] Its all symptoms of the same problem--govt authoritarianism. If I want to hire you to wash my car every week for $5/hr and you agree, why is that a govt role to step in and forbid it?
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