baba@spar.UUCP (Baba ROM DOS) (02/25/85)
> >It is not the same thing to demonstrate that minimum wage laws and unions > >contribute to unemployment as it is to demonstrate that there will be > >no unemployment in the absence of these factors. (Your humble narrator) > > Unemployment is cause by restrictions which keep the wage-rate above > supply-and-demand equilibrium (another non-vacuous tautology); a Free > Economy has no such restrictions. (DKMcK) Unemployment is also caused by circumstances in which the labor supply rises above the "demand" (or, conversely, the demand drops). People have an annoying tendency to come in discrete units, and there is per-unit overhead to employing a worker. If an enterprise requires 1000 workers and there are 1500 people needing work, the equilibrium wage rate may be low, but the enterprise still needs only to employ 1000. The other 500 are free to believe that the free economy will soon allow the enterprise to grow and hire them, but they are no less unemployed for it. > > I pointed out one of > >the other factors in the equation that your article ignored. > > I ignored it because it isn't a factor; technology may make people > dependent on subsidies for survival, but it does NOT create unemployment. Who will pay these subsidies in a Free Economy? > > I instead posted > >a quote from Norbert Wiener in support of the notion that, given the > >potential of technology and the nature of our economic system, the > >equilibrium wage should *ultimately* do precisely that (drop below > >the survival level). > > You're not giving enough attention to bio-technology. Automota will move > forward; so will humankind. This seems to say that your belief that there will be no unemployment in a free economy is predicated on a belief in the ability to improve the value of human labor faster than the value of capital. What happens in a free economy if things go the other way, as they have in the past? Baba