Prevailing Wage

[crazyqx83_rivals88013]

Fairness has nothing to do with it. It has to do with the value of the labor. No offense to Walmart workers, but how difficult would it be to replace that labor with someone else? In most cases, probably not too difficult. If your labor is easily replaced, then it doesn't have a lot of value. It's why Walmart cashiers make less than mechanical engineers. The market pays what is required to attract the labor it needs to perform the job. As a consumer, why would I want any industry to overpay for its labor, materials, or anything else? As someone who owns mutual funds, etc., why would I want a company that I might have invested in to overpay for labor, material, or anything else, and make itself less competitive?

Walmart shouldn't get any form of tax break. The average taxpayer is subsidizing those low prices. Ironically, it's probably the people that don't shop at walmart that are making those low prices possible. Walmart may be the most expansive form of welfare in this country. Except it's a form of welfare that makes a small group of hige income earners a handsome profit.

 

[cat_in_the_hat]

Walmart shouldn't get any form of tax break. The average taxpayer is subsidizing those low prices. Ironically, it's probably the people that don't shop at walmart that are making those low prices possible. Walmart may be the most expansive form of welfare in this country. Except it's a form of welfare that makes a small group of hige income earners a handsome profit.

I'm not following your point here as it relates to the wages of Walmart workers.Can you elaborate some?

 

[fuzz77]

No. Just no. I teach economics. Please take one of my classes. Labor productivity is king.

You would rather pay $50 to get 100 widgets than $10 to get 18.

Theory vs Real World.
If economics was provable science then all economist would agree on what economic policy would produce any given desired result. It isn't and they don't because nothing exists in a vacuum. Economics is as much if not more about politics and power as it is about productivity evidenced by the fact that we have seen decades of productivity gains by labor with no growth in real wages.

Yes, everyone would rather pay $50 to get 100 widgets than $10 to get 18...unless we only have the capacity for 18 widgets. The cost to obtain additional capacity to handle 100 widgets may exceed the per/unit savings for the widgets.

A pipe fitter, carpenter, backhoe operator, etc. isn't able to simply produce to the maximum of their capacity hour after hour, day after day. They are constrained by many parameters that affect the job and outside of their control. At the top of that list is the project management. Example: Two carpenters are hanging roof trusts and are positioned on opposite walls where the trusts will span. A crane operator lifts the truss into place where they are secured by the two workers. Once the crane operator lifts the truss into place it releases the truss and moves to get the next trust. Working at 100% capacity it takes 5 minutes for the crane to retrieve, lift and place each truss. Knowing this, there is no added value in a carpenter who can complete his portion of this task as long as they can do so in less than 5 minutes. The fact that one carpenter can finish in one minute and it takes the other, three minutes is immaterial. The crane operation constrains the capacity of the carpenters to produce.

Productivity of most workers is largely constrained by other outside forces.

 

[crazyqx83_rivals88013]

Theory vs Real World.
If economics was provable science then all economist would agree on what economic policy would produce any given desired result. It isn't and they don't because nothing exists in a vacuum. Economics is as much if not more about politics and power as it is about productivity evidenced by the fact that we have seen decades of productivity gains by labor with no growth in real wages.

Yes, everyone would rather pay $50 to get 100 widgets than $10 to get 18...unless we only have the capacity for 18 widgets. The cost to obtain additional capacity to handle 100 widgets may exceed the per/unit savings for the widgets.

A pipe fitter, carpenter, backhoe operator, etc. isn't able to simply produce to the maximum of their capacity hour after hour, day after day. They are constrained by many parameters that affect the job and outside of their control. At the top of that list is the project management. Example: Two carpenters are hanging roof trusts and are positioned on opposite walls where the trusts will span. A crane operator lifts the trusts into place where they are secured by the two workers. Once the crane operator lifts the trust into place it releases the trust and moves to get the next trust. Working at 100% capacity it takes 5 minutes for the crane to retrieve, lift and place each trust. Knowing this, there is no added value in a carpenter who can complete his portion of this task as long as they can do so in less than 5 minutes. The fact that one carpenter can finish in one minute and it takes the other, three minutes is immaterial. The crane operation constrains the capacity of the carpenters to produce.

Productivity of most workers is largely constrained by other outside forces.

Truss