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by freefaler
228 days ago
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It's not a manifestation on anything. What's cheaper with better quality will be chosen by the consumer. To get cheaper economies of scale are needed. My competitor has a contracting factory in Pakistan that has the same labor costs as me, but works for 50 hours, instead of 32 hours. He can produce 36% more per week, while paying the same cost of capital, opex and other costs, even if he pays the same per hour as me. But if he has 1/10 of the cost of labor and labor is a high % of end product cost, I can't compete and my business is bust, my employees are on the street and we all live from
1. the taxes of the productive people in the society who can sell something competitively outside (to have currency to buy imports)
2. governmental loans to be paid in the future by the people from 1. |
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[1] Sorry, I said that in a different comment in this thread.