This post concerns an implication of Marx’s treatment of productivity and labor complexity for the appropriateness of alternative processes of wage determination. For simplicity, it is assumed that all activity is productive in Marx’s sense (that is, productive of surplus value) and that conditions are competitive in the Marxian (and classical) sense that investment is free to flow in and out of sectors in search of the highest return. Introducing unproductive labor, including a substantial role for public sector and not-for-profit activity, and non-competitive elements would considerably complicate the analysis. The point of the exercise is to consider the incentive effects of alternative wage-determination procedures, from the perspective of Marx’s theory. It is suggested that Marx’s distinction between abstract and concrete labor implies that centralized wage determination, more than alternative wage-setting approaches, will be conducive to productivity growth....heteconomist
Productivity, Labor Complexity, and Wage Determination Procedures
Peter Cooper
Stylized model thinking is interesting in the same way as gazing at an art piece. Teaches you to see patterns, likes shapes of clouds while missing the evolving and always changing message of macro. Hopefully within a generation fewer souls will be wasted on these exercises as quantitative analysis is easy, cheap and are only limited by the quality of data and sampling rather than the confines of the imagination of the thinker.
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