Economics Questions

Re: Why the ABCT is wrong.

Esuric — Sat, 11 Jul 2009 09:14:06 GMT

MarxCapital:
But why would the laborers not take the real increase in wages? Why would the Austrians assume that workers would accept a fall in salaries?

Say's law holds.

Re: Why the ABCT is wrong.

Daniel James Sanchez — Sat, 11 Jul 2009 05:49:13 GMT

Anarchist Cain:

nirgrahamUK:

Its ok to hijack this thread since it finished a good while ago

(i hope)

Well I still want my human nature question answered.

And I'd like to know if she thinks an office worker should get a raise every time his computer gets upgraded, as would be implied by her theory of productivity and wages.

Re: Why the ABCT is wrong.

Andrew Cain — Sat, 11 Jul 2009 04:18:12 GMT

nirgrahamUK:

Its ok to hijack this thread since it finished a good while ago

(i hope)

Well I still want my human nature question answered.

Re: Why the ABCT is wrong.

nirgrahamUK — Sat, 11 Jul 2009 04:11:52 GMT

Its ok to hijack this thread since it finished a good while ago

(i hope)

Re: Why the ABCT is wrong.

Andrew Cain — Sat, 11 Jul 2009 04:08:32 GMT

nirgrahamUK:

thats what they wanted you to think.

Oh snap! You just like ninja'ed my brain!

Re: Why the ABCT is wrong.

nirgrahamUK — Sat, 11 Jul 2009 03:56:06 GMT

thats what they wanted you to think.

Re: Why the ABCT is wrong.

Andrew Cain — Sat, 11 Jul 2009 03:53:17 GMT

nirgrahamUK:
I had special permission from Zog high command. Good Morning Cain-san.

Zog command? What is this nonsense? The Matrix doesn't have a zog command.

Re: Why the ABCT is wrong.

nirgrahamUK — Sat, 11 Jul 2009 03:47:58 GMT

I had special permission from Zog high command. Good Morning Cain-san.

Re: Why the ABCT is wrong.

Andrew Cain — Sat, 11 Jul 2009 03:43:30 GMT

nirgrahamUK:

Anarchist Cain:
You state that human nature is perpetual destruction, what gives you such a premise
the movies.

argumentum ad cinema

Fool! You're not suppose to acknowledge agents arghhhhhh *goes into fits*

Good afternoon....Mr.NirgrahamUK

Re: Why the ABCT is wrong.

nirgrahamUK — Sat, 11 Jul 2009 03:31:25 GMT

Anarchist Cain:
You state that human nature is perpetual destruction, what gives you such a premise

the movies.

argumentum ad cinema

(Please visit the site to view this media)

Re: Why the ABCT is wrong.

Andrew Cain — Sat, 11 Jul 2009 03:26:14 GMT

MarxCapital:
Anyone who brings up the failure of communism/socialism/fascism will be wasting their own time. I know Marxism has failed; but that does not make you right. I'm saying that capitalism must destroy its self, as well as all other potential forms of economics. It's human nature to destroy ourselves.

I'd like to address this point because the economics of your topic have been beaten to death. You state that human nature is perpetual destruction, what gives you such a premise given the fact that humanity has existed for centuries and we have reached whole new technological fields even in this last century?

Re: Why the ABCT is wrong.

Daniel James Sanchez — Sat, 11 Jul 2009 03:25:17 GMT

MarxCapital:
One more question: I believe that capital per worker increases their productivity and therefore should increase their wages, but according to you guys, workers will accept nominal wage cuts and be satisfied with a steady real salary. When production expands, how come workers won't see their real wages rise?

Any greater productivity came from greater capital investment. Greater capital investment came from the increased sacrifice (deferral of consumption) of the saver. Why should the worker take proceeds that were the direct result of the sacrifice of the saver? Why would the saver save in the first place if she knew that was going to be the result? There are a number of ways an individual laborer can garner higher wages. But simply being part of a more productive process by virtue of someone else's investment is not one of them.

Under your system, a construction company who equips a worker with a more powerful, but equally easy to use, power drill would thereby need to pay him higher wages!

Re: Why the ABCT is wrong.

Jon Irenicus — Sat, 11 Jul 2009 03:16:52 GMT

I didn't really mention the ABCT. I just presented a scenario which ABCT seemingly ignores. If you could just tell my why I'm wrong, it would be greatly appreciated.

Read the responses you got so far. I have nothing to add to them.

Re: Why the ABCT is wrong.

Daniel James Sanchez — Sat, 11 Jul 2009 03:06:52 GMT

MarxCapital:
as production increases, so too will the purchasing power of money; prices will fall across the board.

If the quantity of money were to decrease, then prices would fall across the board. However, if productivity increases, then only the goods that were more efficiently produced, and the lower order goods for which they were capital, would have falling prices.

Let's take a hypothetical example of increased productivity. Let's isolate variables by considering an increase in one industry. Let's say that capitalists who own a tractor company, for some reason develop a lower time preference. They reduce consumption, and increase investment into their industry. With the increased investment, they are able to develop more roundabout and more productive processes for creating tractors. They are then able to produce the same number of tractors for less outlay. They will then be able to underprice their competition, out-compete them, and thereby make greater profits. Eventually the competition is forced to also become more productive, or perish. Those that do, will via competition continue to bid tractor prices down. In this deflationary situation, product prices and revenue may have gone down, but so did costs, because that is what made the firms more productive in the first place. Therefore, even if revenue went down, profit margins wouldn't, ceteris paribum. Did the greater productivity of the tractor industry lead to lower or higher wages? It depends on the nature of the more roundabout process: that is how labor-intensive it happened to be. But there is nothing about greater productivity as such that would automatically lead to a necessary change in the wage rates. Did the tractor firms need to have the wages they paid go down in order for their profit to not be destroyed by the deflationary process? No, because the deflationary effect was caused by greater efficiency in the first place, which means again, that the lower prices and revenue are offset by the more cost-effective means of production.

MarxCapital:
traditionally, laborers don't accept lower wages

Productive capital investment will lead to lower demand for labor only if the new processes call for less labor. If that were the case, and you are saying that the lower demand would NOT have a lowering effect on wages, then you are denying the law of supply and demand.

Re: Why the ABCT is wrong.

filc — Sat, 11 Jul 2009 02:05:07 GMT

Marx,

Are you going to actually respond to people's rebuttels which is normal in most discussions or continue to attempt at changing the subject. If you continue to change the subject I have to quesiton why you posted here in the first place?