Interesting Links for 10-10-2012

[andrewducker]

• The Greek message for Angela Merkel
  (tags: austerity greece germany europe finance )
• 50 Years of LED Technology
  (tags: led technology )
• Does the computer mouse face extinction? (Not this week)
  (tags: technology computers mice )
• Could Fast Food Robots Steal McJobs?
  (tags: viaFanf robots restaurant food thefuture )
• More people being

Comments

[cairmen]

Interested by your comment on the Citizen's Income blog about minimum wage.

The problem with abolishing minimum wage in connection with Citizen's Income is surely that it opens the entire experiment up to some pretty dramatic second-order effects that you won't be able to predict until we get there - like the effect of a sudden shift in wages across the entire nation on tax raised.

Plus, would the ensuing adjustment in wages actually end up with poorer people worse off?

(Citizen's Income is a hobbyhorse of mine - I'm in the "this is obviously better, do it already" camp - but I'd not thought of linking it to an abolished minimum wage.)

[andrewducker]

It shouldn't greatly affect existing wages - these are all already in places where the employer can make a profit while employing someone at that wage.

What it should do is allow people to be employed for lower wages that are competitive elsewhere. If stuffing envelopes is only profitable at £1.50/hour, and you can find someone willing to work for that (on top of the citizen's income), then (a) you've avoided offshoring the work, (b) you've employed an extra person, (c) you're providing _more_ tax, and (d) you're reducing the slack labour pool, which should (theoretically) push wages _up_.

It should, really, be a win all round.

[drplokta]

The employer can no longer make a profit while employing someone at the former minimum wage if a new competitor comes along paying only half that much and therefore charging much lower prices.

[andrewducker]

That depends on who they can get for the even lower prices, and whether all of those people have already been sucked up by the current wages.

I remember when there was no minimum wage, and we didn't all work for 3p/hour!

[cairmen]

Yes, there are definite huge upsides.

I can tell you for a fact that if your plan went into action tomorrow, Strange Company would promptly create several Edinburgh-based film/animation jobs - jobs that currently I have to outsource for cost reasons.

Something like this could deal a deathblow to the current internship culture, too, which would be good all round.

[andrewducker]

The one where only middle class people can afford to take them? Yes, I loathe that.

[andrewducker]

Are you sure you could find animators willing to work for less than the current minimum wage?

[cairmen]

1) I wouldn't necessarily be seeking fully-trained animators. Quite a lot of the work we do is amenable to being done by bright people who are being trained on the job.

2) Yes, absolutely 100% certain. The animation industry, like the rest of the film industry, is not one where the jobs outnumber the people who want to do them :).

[naath]

On the flip side if everyone is adequately housed and fed on the CI then what incentive do they have to stuff envelopes for a pittance?

They may cheerfully go into a career they love (like games design, or animation, or writing books, or something) for tiny amounts (or even no) money... but I think you see an enormous drop in the numbers of people prepared to do menial tasks for little reward.

[0olong]

I'm not seeing it. Even a little reward doesn't look so little when you have just enough to live on. I'd be happy to spend a couple of days a week stuffing envelopes for maybe £4/hour if I didn't have to worry about losing money elsewhere and having to fill in loads of paperwork. That'd be, like, £60 extra a week! That's enough to go out on the weekend without going broke! Or I could save up and maybe buy a new camera in a couple of months!

[andrewducker]

Yup, that's pretty much how I feel too - more money = good.

[del_c]

If said drudge-labour tasks are worthwhile to the employer of the labour, then the "labour shortage" (always scream "labour shortage!!" in tones of horror :-) will have to be counteracted by raising the compensation. If the activity isn't worth it to the employer, then we probably shouldn't be engaging in it as a civilization.

Whenever I hear land owners moaning about "crops rotting in the fields" I think the land owners didn't think much of those crops.

[stillcarl]

That's my feeling too. Employers will have to up the wages for menial jobs as soon as people don't have to do them just to have an income.

What it'll do to the wages of the more interesting jobs though is anybody's guess.

[danieldwilliam]

People who I know think about things seem in favour of the Citizens’ Income.

I am struggling to see how it isn’t a subsidy for low wages.

[danieldwilliam]

My starting point for this comment is that someone’s pay has something to do with a combination of their marginal productivity (how much extra economic value they create) and their negotiating position (how rare, difficult to replace or advantaged by tradition they are). This may or may not be the case and the combination of the two factors may vary significantly. If it is the case then generally speaking individuals, firms and industries that constistently create economic value are going to be given a share of that value and be in a stronger negotiatiing position

[andrewducker]

Then I am failing to see how any form of in-work benefit isn’t a subsidy from economically useful activity to economonically less useful activity.

Of course it is. But either we say that no economically less useful activity will occur (cue vast awathes of people out of work), or we agree that it's better to have them employed, even if it's a drag on employed people.

I lean largely towards the latter, because I think it's better for the overall economy (and people's happiness) to employ people in jobs that might not otherwise exist, than to have people unemployed (and people unable to buy food they'd like to eat).