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383 points imartin2k | 1 comments | | HN request time: 0.195s | source
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cousin_it ◴[] No.14330454[source]
I don't understand the libertarian argument for allowing low wages. Let's say company X is paying low wages, which allows it to sell goods for cheap. If company Y tries to enter the market and pay higher wages, they won't get any market share, because their goods will be more expensive. So wages will stay low forever. Am I missing something?
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jstanley ◴[] No.14330505[source]
If company Y is producing the same quality of goods as company X but trying to charge more money, they deserve to be out-competed by company X. Do you agree?

Equally, if employee Y is producing the same quality of work as employee X but trying to charge more money, does employee Y not deserve to be out-competed by employee X?

Employment is a two-sided market too.

Nobody would advocate for a minimum price for a packet of crisps just to save the poor crisp companies from earning too little per packet. It is obvious that if crisps were too expensive, people would stop buying them. The same applies for workers.

Minimum wage is just saying "if you can't produce at least $X of value per hour, you're not allowed to work at all". That's not fair.

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DougBTX ◴[] No.14330651[source]
> Minimum wage is just saying "if you can't produce at least $X of value per hour, you're not allowed to work at all". That's not fair.

That's an oversimplification, since it ignores what is paid to people who produce more than $X of value per hour.

Minimum wage says something closer to, "If you can produce at least $X+Y value per hour, you will be paid at least $X", where X is the minimum wage, and Y is the level of profit that a company needs to operate.

Assuming no upward pressure on X, a company will prefer to maximise Y and minimise X. Minimum wage laws are one way to apply upward pressure. Competition over constrained supply is another, but only applies if there actually is a supply constraint.

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jstanley ◴[] No.14330744[source]
What about the people who are unable to produce at least $X of value per hour? They don't matter?

You're surely not interested in protecting the somewhat-poor at the expense of the poverty-stricken.

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1. Fnoord ◴[] No.14332752[source]
> What about the people who are unable to produce at least $X of value per hour? They don't matter?

They get fired as soon as statistics show they don't meet their targets. We already have tons of those jobs in existence and the rise of technology only oversimplified this further. Case in point: a call center. Say the goal is you need to deal with X customers in an hour. That doesn't mean their problems are solved. And even if the problem is (seemingly) solved that doesn't mean their problems are solved in the best way possible. And yet, this is the basis of how call centers operate these days.

What happens when people get fired? Well, in some countries you get social benefits and in some you don't but there's no country where those benefits are going to pay your bills AND allow you to enjoy any form of luxury. So what happens either way? They look for a new job. Preferably legal job, but if they can't, they resort to shady businesses. Grey areas. You know, like Uber*?