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by rmtech 2044 days ago
> That's thanks to competition between companies. That's market forces at play. You want it there? Accept it on salary negotiation too.

This is itself a bit naive. In a basic market with voluntary transactions the distribution of the gains from trade is undefined.

If your labor sells for $100/hour and costs you $10/hour to produce (basic food, water and shelter) then it is a perfectly legitimate equilibrium for the company to pay you $10.01/hour and take the other %89.99 as profit.

It's only through politics that we can make sure that the gains from trade are evenly split. The math of markets doesn't define it.

2 comments

> It's only through politics that we can make sure that the gains from trade are evenly split. The math of markets doesn't define it.

That's clearly not the case since my employer could legally pay me $15/hour for my work, but pays significantly more. They do so, because they are competing with other employers for talent.

> They do so, because they are competing with other employers for talent.

Yes, but the RESULT of the two-way competition where both employees and employers are competing is undefined in a simple model of the market.

If you work as a cleaner or an uber driver, you may find that even though you generate some surplus, you don't actually get any of it (or you get almost none of it)

> It's only through politics that we can make sure that the gains from trade are evenly split.

False. Competition from other employers can do this too.

> can do this too.

Yes, it CAN but whether it actually does depends on the details. If you are a cleaner or an uber driver, you might generate some surplus but you might see the other parties take all or almost all of that surplus.