Re: What do workers compete for?

"Matt Timmermans" <mt0000@[EMAIL PROTECTED]
> wrote in message
news:OYYlc.26361$3Q4.668510@[EMAIL PROTECTED]
> At first glance, the return to labour seems straightforward:  a skilled
> person who wants to work can join himself to the required land and
capital,
> work hard to create value, and demand a significant ****tion of that
value in
> return.

First, nobody want to work.   Second, what does skilled have to do with
it?  And how
does somebody join himself to the required land and capital?  Capital can
be
produced, land can't.   The quantity of land is fixed.  More im****tantly,
certain
locations offer great advantages that have nothing to do with the
improvements on
those sites.

In fact, after deducting reasonable returns to capital and land, it
> would seem that he can claim the rest.

Reasonable is a hard word to define in economics.   Capitalists are not
after
reasonable returns but the highest returns they can get for lending
capital.   The
maximum return is set by competition among capitalists.

Land owners also try to get as much as the traffic will bear.   But unlike
capitalists, land owners have a monopoly bargaining position.   The owner
of a good
location looking for a tenant or buyer has only so many competitors at a
particular
moment.

The return to land ( rent ) therefore is not set by "reasonable" levels
but by
monopoly.    Workers bargaining position vis a vis land is very poor
compared to
land owners.  Workers with no other income will starve without immediate
use of land
while landowners can typically hold out much longer before accepting a
tenant.





If that's true, then a worker's
> natural compensation is determined almost completely by his own
> productivity -- it doesn't matter who else is in the workforce and what
> they're willing to work for.

>
> This notion is, of course, in conflict with the commonly held
(especially
> among the "outsourcing bad!" crowd) belief that wages are held down by
> competition among workers.

Employers are both land owners and capital owners.   It is in their land
owner role
that land owners are able to take advantage of the desperate bargaining
position of
labor.   Where people are desperate for land to use to make a living, they
will pay
higher rents.    Rents are deducted from paycheck wages by employers. 
This is how
competition for employers ( land) drives down wages.


> But if wages are held down by competition among workers, then what,
exactly,
> do they compete for?  Capital isn't scarce, and land isn't scarce, so
how
> can jobs be scarce?

Good locations are always scarce.   But the land monopoly system we have
makes land
artificially scarce.


Why would a company decline to hire someone who can
> produce in excess of his compensation and the other costs associated
with
> his employment?

Workers are also consumers.   Demand for produced goods and services is
held down by
low wages.   Where land is open to all on equal terms, wages rise to the
full reward
of labor and consumers have purchasing power to buy goods.    Where land
is held at
monopoly prices, wages are low, purchasing power is low, and demand for
produced
goods suffers.

[...]

MM