US Politics Mega-thread - Page 835

On February 02 2014 10:41 Vegetarian wrote:



Roe can you explain this phenomenon of people being paid more than the minimum wage? If its just up to a boss what people are paid then why does anyone get paid more than the minimum wage?

On February 02 2014 11:19 Roe wrote:


Why wouldn't they?

On February 02 2014 14:49 hunts wrote:


Because why would a boss ever decide to pay more than minimal wage if they don't have to pay more? You can pay cashiers minimum wage because if one quits 10 more will apply. That is "the marketplace". Now what happens if you set up a company and try to pay your programmers and accountants minimum wage? You won't get any, because they will go to companies who pay them what is deemed a fair salary by....*insert dramatic drum roll* The job marketplace.

On February 02 2014 15:23 FabledIntegral wrote:


Because paying more than minimum wage can increase efficiency through lower turnover, which is huge cost for lots of businesses^^.

On February 02 2014 16:53 Danglars wrote:
It's so simple yet explanatory. Training costs, hiring costs, the coverage during turnover. It isn't like 10 magical things happen as you move from unskilled labor to some of the lower technical and trade jobs. It's still they're adding value to the company and become worth a higher wage. Even for the non-union contractual places, you can sometimes be that guy that always shows up on time and works his ass off to get a 50 cent raise.

On February 02 2014 19:17 corumjhaelen wrote:

It's not because they're worth a higher wages they're paid more. The company is maximizing profit may I remind you...
Supply and demand seems to say a bit more about that question. Or in other terms, it's a power relationship.

On February 03 2014 00:45 oneofthem wrote:
when you say le supply and demand it implies the wage is a product of natural forces. it's really not. different strategies of development taken by employers, employee leverage (unionization, laws, reserve pool of workers) and various factors affecting reservation wage positive and negative.


let's put it this way, looking at the world, you'll see the basic employer employee relationship without a chain (which apparently makes libertarians jump up in rage, rather than the more powerful and simple power of starvation) producing wages so low that it would seem to be barely worthwhile for an american minimum wage worker. why is the american minimum wage worker earning more than a bangladesh teenager, or why is the american worker today earning more than she was during the glory days of children in mines and factories?

the answer has quite a lot to do with politics. not recognizing this basic fact is just to shut your mind with ideology. it's pretty stupid

On February 03 2014 02:05 FabledIntegral wrote:


I'm not really sure how I find your post to be relevant in this case... they're still all pretty much market forces when it comes down to it, just in a really broad sense.

On February 03 2014 02:08 oneofthem wrote:

the market mechanism is always there. so when supply and demand in one situation leads to drastic different results from supply and demand in another situation, then it's not the central analysis anymore.

On February 03 2014 02:18 FabledIntegral wrote:


Of course it is... barriers to entry are the direct result of the market wage gap between Bangladesh and the American minimum wage worker, which is a market force. These barriers prevent a more globalized economy. As globalization has become much more significant in the past 30 years, barriers have fallen and this is the exact reason why you see so many things being outsourced the and the U.S. losing the majority of it's status as a manufacturing powerhouse.

On February 03 2014 03:11 oneofthem wrote:
this is a richer analysis than 'supply and demand' and does not make the situation seem like the product of natural forces. to put more meat on the issue, you can assign some portion to technology and some portion to political actions by specific factions and people. there are many comparative econ studies from for example an anthropological or sociology perspective.

Basic structural characteristics

Generally, a perfectly competitive market exists when every participant is a "price taker", and no participant influences the price of the product it buys or sells. Specific characteristics may include:

Infinite buyers and sellers – An infinite number of consumers with the willingness and ability to buy the product at a certain price, and infinite producers with the willingness and ability to supply the product at a certain price.

No barriers of entry and exit – No entry and exit barriers makes it extremely easy to enter or exit a perfectly competitive market.

Perfect factor mobility – In the long run factors of production are perfectly mobile, allowing free long term adjustments to changing market conditions.

Perfect information - All consumers and producers are assumed to have perfect knowledge of price, utility, quality and production methods of products.

Zero transaction costs - Buyers and sellers do not incur costs in making an exchange of goods in a perfectly competitive market.

Profit maximization - Firms are assumed to sell where marginal costs meet marginal revenue, where the most profit is generated.

Homogenous products - The qualities and characteristics of a market good or service do not vary between different suppliers.

Non-increasing returns to scale - The lack of increasing returns to scale (or economies of scale) ensures that there will always be a sufficient number of firms in the industry.

Property rights - Well defined property rights determine what may be sold, as well as what rights are conferred on the buyer.

Rational buyers - buyers capable of making rational purchases based on information given

No externalities - costs or benefits of an activity do not affect third parties

On February 03 2014 03:29 Nyxisto wrote:
I don't get the obsession with "what the market says.." Are the markets omniscient deities we have to follow? Instead of debating whatever the market dictates(which economists seem to be doing for a few centuries now, without making any kind of progress) wouldn't it make more sense to discuss if that even matters in the first place?

A few pages ago I suggested that people who full-fill important functions in a society should be paid accordingly. Danglars responded promptly with something along the lines of "yeah but morality is your personal thing, that has no place in payment, it's all supply&demand..". I'm a little confused why it's so ridiculous to think that only "what the market says.." counts and every other factor basically doesn't play a role.

On February 02 2014 10:41 Vegetarian wrote:



Roe can you explain this phenomenon of people being paid more than the minimum wage? If its just up to a boss what people are paid then why does anyone get paid more than the minimum wage?

On February 03 2014 03:29 Nyxisto wrote:
I don't get the obsession with "what the market says.." Are the markets omniscient deities we have to follow? Instead of debating whatever the market dictates(which economists seem to be doing for a few centuries now, without making any kind of progress) wouldn't it make more sense to discuss if that even matters in the first place?

A few pages ago I suggested that people who full-fill important functions in a society should be paid accordingly. Danglars responded promptly with something along the lines of "yeah but morality is your personal thing, that has no place in payment, it's all supply&demand..". I'm a little confused why it's so ridiculous to think that only "what the market says.." counts and every other factor basically doesn't play a role.