View Poll Results: Does Labor Exist on a Supply Demand Curve

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  • Price, Supply, and Demand of Labor all impact each other

    31 93.94%
  • Labor is not impacted by Price, Supply, or Demand

    2 6.06%
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Thread: Does Labor Exist on a Supply / Demand Curve?

  1. #31
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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by cpwill View Post
    Is labor impacted by relative supply and demand? If there is a shortage of trained engineers, will their income go up? If there is a surplus of recent law-school graduates, will their income go down? If we increase the price of labor without altering supply, will demand go down?

    In short, is labor effected by supply and demand? Or magically is it the one service / commodity that isn't, just because it happens to be the thing that most of us sell?


    Poll is in response to several people that I have seen either explicitly or implicitly argue the latter, that somehow if you increase the cost of labor, you do not decrease demand when supply is held constant.
    It is effected by supply and demand, but its different than other commodities.

    For example one can hold capital, workers cannot just hold labor (workers need wages to survive), also labor value changes all the time with productivity changes, at the same time as productivity goes up price does not necessarily go up, since the demand for work is stable its just equal to the working population, while the demand for labor may change based on aggrigate demand. The holder of capital will always pay the least while getting the most out of labor, also a difference is that labor is a PRODUCER of value, without any innate use value, its use is producing other use values, as such it would be priced differently from commodities whose value is its own use value.

    Demand for labor however is not necessarily based on the price, its based on aggrigate demand in the economy, i.e. how much profit is able to be made. So for example if labor price goes up, supply is the same, yet aggrigate demand for goods and services is steady and profit is still being made the demand for labor will be steady.

    Not to mention that a ton of aggrigate demand COMES from wages, putting a whole new spin on it.

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by ReformCollege View Post
    Then the basic measurement of human capital would be the distribution of diplomas. Would it not?
    Do you mean by cirtification of knowledge or by some other criteria?

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by RGacky3 View Post
    It is effected by supply and demand, but its different than other commodities.

    For example one can hold capital, workers cannot just hold labor (workers need wages to survive), also labor value changes all the time with productivity changes, at the same time as productivity goes up price does not necessarily go up, since the demand for work is stable its just equal to the working population, while the demand for labor may change based on aggrigate demand. The holder of capital will always pay the least while getting the most out of labor, also a difference is that labor is a PRODUCER of value, without any innate use value, its use is producing other use values, as such it would be priced differently from commodities whose value is its own use value.

    Demand for labor however is not necessarily based on the price, its based on aggrigate demand in the economy, i.e. how much profit is able to be made. So for example if labor price goes up, supply is the same, yet aggrigate demand for goods and services is steady and profit is still being made the demand for labor will be steady.

    Not to mention that a ton of aggrigate demand COMES from wages, putting a whole new spin on it.
    It is possible to disconnect labor from demand, or at least put an extreemly long time delay in the loop. I have done it a few times. e.g. A small computers power supply made in the US was moved to Mexico, where workers didn't know how to build it to the required quality. And, where the workers were paid so little they would not be buying the product, directly or indirectly, i.e. the computer.

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by OhIsee.Then View Post
    It is possible to disconnect labor from demand, or at least put an extreemly long time delay in the loop. I have done it a few times. e.g. A small computers power supply made in the US was moved to Mexico, where workers didn't know how to build it to the required quality. And, where the workers were paid so little they would not be buying the product, directly or indirectly, i.e. the computer.
    We are talking macro economics, apples and oranges.

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by OhIsee.Then View Post
    Do you mean by cirtification of knowledge or by some other criteria?
    I mean a basic measurement of human capital. For instance, I forgot where I was reading this, but one Bloomberg article was talking about if employers just had a basic map of the U.S. that showed the concentrations of where the college graduates in various fields were, they would be much better off being able to recruit and employ people for job openings.

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by RGacky3 View Post
    We are talking macro economics, apples and oranges.
    I have been comparing my experiences with others for more than two decades. Everyone that is has experience with outsourcing has the same experiences and shares the opinion that this is happening everywhere and often, not just with apples and oranges. (Oh that's right, they did use the approved insecticide on those apples since they did certify that.)

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by ReformCollege View Post
    I mean a basic measurement of human capital. For instance, I forgot where I was reading this, but one Bloomberg article was talking about if employers just had a basic map of the U.S. that showed the concentrations of where the college graduates in various fields were, they would be much better off being able to recruit and employ people for job openings.
    I and others have found that the diploma isn't sufficient to certify the ability to do the work. What have you found?

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by OhIsee.Then View Post
    I and others have found that the diploma isn't sufficient to certify the ability to do the work. What have you found?
    Maybe, maybe not. But it is neccesary for the fields where the jobs are going to be growing the next few decades, or the STEM fields. You can't be an engineer if you can't do calculus.

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by ReformCollege View Post
    Maybe, maybe not. But it is neccesary for the fields where the jobs are going to be growing the next few decades, or the STEM fields. You can't be an engineer if you can't do calculus.
    You don't need a degree in order to do calculus

    I've been a STEM worker for 30 years with no college degree
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    the vast majority of folks that need healthcare are on Medicare.. both rich and poor..

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    Re: Does Labor Exist on a Supply / Demand Curve?

    Quote Originally Posted by cpwill View Post
    Agreed. The relative price of capital, for example. However, my point is simply that I believe that the cost of labor impacts demand for it, and yet while I find this to be among the most obvious things in the world, I have repeatedly seen several others argue as though this were not true.
    And, vice versa, the demand for labor also affects the cost of it. Both statements are true.
    "Political speech and writing are largely the defense of the indefensible. . . . Thus political language has to consist largely of euphemism, question-begging and sheer cloudy vagueness."
    ~Orwell, Politics and the English Language

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