It is common to hear people complain about immigrants taking the jobs of locals. The logic behind this is simple; if an immigrant has a job then that is one less job for a local. It is therefore deduced that a large influx of immigrants would be disastrous, leading to mass unemployment and a decline in the standard of living. However this is not supported by the evidence. There are several examples of huge numbers of immigrants entering a country within a short period of time, yet the economy does not collapse. Continue reading “Immigrants Don’t Steal Our Jobs”
Orthodox economics treats labour as a good like any other subject to the laws of supply and demand. However this misses a crucial point that we are not dealing with commodities but rather people. With goods, demand is decided by consumers and supply by producers, whereas with labour, demand is decided by producers and supply by consumers. The entire system is turned on its head yet neo-classical economics claims the results will be the same.
Continue reading “Labour Market In The Real World”
Once upon a time there was a car manufacturer. One day he proposed to double his workers wages. The business community was stunned. Was this man insane? A socialist? Did he not understand the laws of economics? Surely his business would instantly go bankrupt and nothing more would be heard of him. In response he simply pointed out that with a wage increase his workers could now afford to buy the cars they made. Business boomed, profits rose and the company redesigned the entire car industry. The man’s name was Henry Ford. Continue reading “Pay More, Get More”