Re: Why are some people rich and others poor?
- From: royls@xxxxxxxxx
- Date: Fri, 29 Jun 2007 02:29:06 GMT
On Fri, 29 Jun 2007 00:04:05 GMT, David_wright@xxxxxxxx (David Wright)
wrote:
We assume a free market is competitive, and that competition forces prices
down to 'costs', so that economic efficiency equals technical efficiency.
That assumption is false, as there are not unlimited resources to
increase supply, and natural resources themselves are in fixed supply.
But when we look at labor, if labor was competitive, and competition forces
acted there, then wages would fall to the costs of producing labor, and all
wages would be the same.
No, because the producers of labor -- parents -- do not get paid for
the labor they produce.
To explain the inequality of wages, we assume a non-
competitive market for labor.
The inequalilty of wages is adequately explained by the inequality of
labor quality.
But why is this? Why not assume a non-
competitive market for goods?
Many goods markets are indeed non-competitive.
The same is true for capital. In a competitive economy, the price of capital
should fall to its reproductive value.
Depends what you mean by, "capital."
Therefore, I concclude that the economy can never be characteristized as
competitive. Perhaps this is nothing new.
It isn't.
-- Roy L
.
- References:
- Why are some people rich and others poor?
- From: David Wright
- Why are some people rich and others poor?
- Prev by Date: Re: LVT: From the rich. To the rich?
- Next by Date: Re: From the rich. To the rich?
- Previous by thread: Re: Why are some people rich and others poor?
- Index(es):
Relevant Pages
|
|
