[411111111111111]

There are a lot of people that don't understand it in the west as well. It's also not as easy as some people make it sound. After all, it's the perceived value of both parties making the trade and not the actual value that's important.

[faeyanpiraat]

Is there a difference though?

If I perceive a “perceived” value, who perceives the “actual” value?

Spreadsheets?

[411111111111111]

Yes, take the original situation for example. The coconut harvester and the person employing him perceive the work to be of very low value.

As such, the actually valuable work with high danger, which should've been paid appropriately is significantly underpaid.

/edit: maybe its easier to relate in the context of the tech industry... while it has significantly less impact on the employees live its prevalent there as well, and in both directions.

fresh graduates which get less then a third of a full employee while still producing basically the same value to the employer. (this obviously depends on the graduate, but surely everyone knows that people at the start of their career tend to be significantly underpaid). both the graduate and the employer just don't perceive their work to be as valuable.

its just as easy to find the pendulum swinging in the other direction as well... people which might even effectively sabotage the work of others while still looking perfect to the person paying the bill, essentially increasing their perceived value to the person paying the bill while effectively reducing the actual throughput/quality.

[lotsofpulp]

> but surely everyone knows that people at the start of their career tend to be significantly underpaid). both the graduate and the employer just don't perceive their work to be as valuable.

If everyone knows this, then why isn’t there an employer taking advantage of this arbitrage opportunity to pay the new graduates more and use their “valuable” labor to generate valuable products for sale?

The answer is that no one knows the exact numerical value of the “value” of someone’s labor. Hence we rely on the buyers and sellers’ making offers to each other and coming to an agreement. As long as there are many buyers and many sellers, working independently, the market value should become evident.

Sometimes the buyer pays a little extra, sometimes the seller pays a little extra. It’s when there is no price transparency and insufficient number of buyers and sellers that the signal gets noisy.