Market rates for labor

[Canard DuJour]

I think people mean the utility of the final good or service - safe roads, bridges etc in this case. Which remains unchanged and does mean "how much somebody values the work," just not how little a middleman can get away with paying.

But the final good or service is not the same thing as the civil engineer's work. She designs a safe bridge; people prefer having that bridge to not having it. So what? That doesn't mean they value her work the amount they value the bridge. She didn't build that! The bridge is the synergistic result of thousands of people's contributions, including workers, managers, entrepreneurs, investors, regulators, police, and, yes, even middlemen. If you propose to define the value of her engineering work based on measuring the utility of the bridge, how are you going to do that?

Nah, I said the utiliy of safe bridges, not the utility of some bridge. The safe bit is specifically civil engineers' contribution and an alternative bridge to the one I'm on makes me value its safety no less.

For that matter, why would you even think the utility of the bridge is unchanged by the rise in engineering availability? If people didn't have the bridge they'd have to make other arrangements. Like any other input, when engineering services become more available, that makes it easier for people to make other arrangements. So the consequence of not having the bridge becomes less harmful.

It might or might not. It's beside the point that civil engineers' wages will be bid down regardless.

In fact it's only "easier for people to make other arrangements" if there are more civil engineering projects. That tends to raise civil engineers' wages while - by your logic - reducing the consumer utility of their work.

 

[Canard DuJour]

Neither are safe roads and bridges.

If there are two safe roads to drive on, then the value of each road drops vs a scenario where there is only one safe road to drive on.

Which is irrelevant since

a) more civil engineers doesn't mean more roads. More civil engineers without more roads does, however, mean lower wages for the same consumer utility.

b) even assuming more roads, alternative roads to the one you're on don't make you value its safety any less.

The value of one particular safe road can indeed drop.

The value of safe roads doesn't drop with the quantity of roads. And if it did, civil engineers' wages would have an inverse relation to consumer utility.

Furthermore, even if the final product is valued the same, the relative value of each input that went into producing it can change. There is no objective value to any one of the thousands of inputs that went into the production of the bridge.

I don't think anyone's saying otherwise.

 

[Loren Pechtel]

As for what happens if the bridge collapses in three months? It's usually discovered that the contractor disregarded the engineer's specs and took shortcuts.

Yeah. They are in the process of tearing down a skyscraper here--and it has to be done the hard way, they can't blow it down given it's location. There's still an awful lot of finger pointing going on but what is certain is that the rebar was not done to the specs and the building is considered in danger of spontaneous collapse despite never being anything like completed. Given how the contractor has been squealing I'm pretty sure they're guilty and know it. Half a billion dollars down the drain.

 

[Bronzeage]

As for what happens if the bridge collapses in three months? It's usually discovered that the contractor disregarded the engineer's specs and took shortcuts.

Yeah. They are in the process of tearing down a skyscraper here--and it has to be done the hard way, they can't blow it down given it's location. There's still an awful lot of finger pointing going on but what is certain is that the rebar was not done to the specs and the building is considered in danger of spontaneous collapse despite never being anything like completed. Given how the contractor has been squealing I'm pretty sure they're guilty and know it. Half a billion dollars down the drain.

That's a problem for the Bonding Company.

True story about a contractor:

My city is on the Mississippi River, but when it rains, the water can't flow into the river, because the levee is in the way. This means the parts of the city that drained into the river, for thousands of years, now flood, if it rains a lot. To remedy this problem, we have big giant pumps that sit there, just waiting for it to rain really bad.

It was back in the 70's, when the city hired an Engineering firm to design a pumping station that would house four giant diesel engines that could take all the rain that fell on a twenty square mile area and throw it all over the levee. Four 5 foot diameter pipes cross the top of the levee and dump rain water into the river.

The design called for a big concrete bucket to built beside the levee. The concrete required to handle the stress of these four giant diesel engines was 2 feet thick and was supposed to be set on piles which would be driven about 100 feet into the ground. It was a pretty straightforward time tested design. It was not any kind of cutting edge technology. Just solid engineering. The design was accepted and bids were let out. The winning bid was a big time contractor. After the contract was signed, he decided the piles were overkill. If this had been a Federal or State contract, it would never have happened, but since this was a city project, it was kind of hazy. There was an exchange of memos and somewhere in the paperwork, a city engineer agreed the piles were too much.

There was no formal change order, or addendum to the contract. The contractor simply built the concrete bucket without the piles.

As the last of the concrete was poured, the thing began to sink. It wasn't like a ship sinking, but it was enough to worry people. The design Engineer was called in to look at it and he said, "Yeah, that's why we said put it on piles." There was no easy solution. The choices were to either move over and build a new one, or to punch holes in the bottom and drive the piles. Neither choice was really viable. They finally decided to fill the bucket up with sand and wait to see how much it sank.

After about 6 months, it stabilized and quit sinking. They let it sit another 6 months. The diesel engines and the pumps were installed and it's been working fine for 40 years.

The problem came when the contractor wanted to be paid. There was a late penalty which was substantial, because the project was a year over due. There was a lot of bitching on the city council, but in the end, they all pretended the contractor had not tried to rob them, and paid the full bill.

 

[Bomb#20]

But the final good or service is not the same thing as the civil engineer's work. She designs a safe bridge; people prefer having that bridge to not having it. So what? That doesn't mean they value her work the amount they value the bridge. She didn't build that! The bridge is the synergistic result of thousands of people's contributions, including workers, managers, entrepreneurs, investors, regulators, police, and, yes, even middlemen. If you propose to define the value of her engineering work based on measuring the utility of the bridge, how are you going to do that?

Nah, I said the utiliy of safe bridges, not the utility of some bridge. The safe bit is specifically civil engineers' contribution and an alternative bridge to the one I'm on makes me value its safety no less.

The safety of the bridge is no more the engineer's sole work than the bridge itself is. Lots of people have to do their jobs in order for the bridge to be safe; besides which, the engineer spends her work time figuring out a lot of things besides how to make the bridge safe. You think you can quantify how much better you like a safe bridge than an unsafe one in monetary terms, and how much of that difference is due to the engineer and not due to the construction foreman who noticed a welder was drunk and pulled him out? How are you going to do that?

Besides, you seem to be assuming the alternative bridge is unsafe. If bridge B is safe and you use bridge B half the time, why wouldn't that make you value the safety of bridge A less than if you always used it?

For that matter, why would you even think the utility of the bridge is unchanged by the rise in engineering availability? If people didn't have the bridge they'd have to make other arrangements. Like any other input, when engineering services become more available, that makes it easier for people to make other arrangements. So the consequence of not having the bridge becomes less harmful.

It might or might not. It's beside the point that civil engineers' wages will be bid down regardless.

In fact it's only "easier for people to make other arrangements" if there are more civil engineering projects. That tends to raise civil engineers' wages while - by your logic - reducing the consumer utility of their work.

There's no contradiction between consumers valuing the product less even while the input is getting valued more, because the one is not the cause of the other. Rather, a previous change causes both. Welcome to equilibrium. The same process happens in economics as in mechanics, chemistry, what have you: a disturbance to a system tends to change the system in ways that will oppose the disturbance. In electromagnetism they call it Lenz's Law. In ksen's economic scenario the original disturbance was "an influx of civil engineers". That's what causes the market rate for them to go down, which reduces the incentive for more civil engineers to come. But the reduction in the price of civil engineering services also causes there to be more civil engineering projects, which tends to raise civil engineers' wages part way back to the original level. But the increase in projects reduces the consumer utility of their work, which reduces the rate of new projects part way back to the original level. "And so on and so forth and such like." -- any disturbance will have dozens of effects propagating through the economy as it gradually restabilizes in a way that accommodates the original disturbance.

Squeeze a balloon and the balloon changes shape in a way that makes it push back harder on your hands. But the squeezing doesn't just change the shape; it also reduces the volume of the balloon. And a volume reduction by the same logic must make it push less hard on your hands. A contradiction? No, just static equilibrium.

 

[ZiprHead]

As for what happens if the bridge collapses in three months? It's usually discovered that the contractor disregarded the engineer's specs and took shortcuts.

Yeah. They are in the process of tearing down a skyscraper here--and it has to be done the hard way, they can't blow it down given it's location. There's still an awful lot of finger pointing going on but what is certain is that the rebar was not done to the specs and the building is considered in danger of spontaneous collapse despite never being anything like completed. Given how the contractor has been squealing I'm pretty sure they're guilty and know it. Half a billion dollars down the drain.

See the fun that's been had with the Zilwaukee Bridge here in Saginaw.

https://en.wikipedia.org/wiki/Zilwaukee_Bridge

 

[Loren Pechtel]

Yeah. They are in the process of tearing down a skyscraper here--and it has to be done the hard way, they can't blow it down given it's location. There's still an awful lot of finger pointing going on but what is certain is that the rebar was not done to the specs and the building is considered in danger of spontaneous collapse despite never being anything like completed. Given how the contractor has been squealing I'm pretty sure they're guilty and know it. Half a billion dollars down the drain.

That's a problem for the Bonding Company.

True story about a contractor:

My city is on the Mississippi River, but when it rains, the water can't flow into the river, because the levee is in the way. This means the parts of the city that drained into the river, for thousands of years, now flood, if it rains a lot. To remedy this problem, we have big giant pumps that sit there, just waiting for it to rain really bad.

It was back in the 70's, when the city hired an Engineering firm to design a pumping station that would house four giant diesel engines that could take all the rain that fell on a twenty square mile area and throw it all over the levee. Four 5 foot diameter pipes cross the top of the levee and dump rain water into the river.

The design called for a big concrete bucket to built beside the levee. The concrete required to handle the stress of these four giant diesel engines was 2 feet thick and was supposed to be set on piles which would be driven about 100 feet into the ground. It was a pretty straightforward time tested design. It was not any kind of cutting edge technology. Just solid engineering. The design was accepted and bids were let out. The winning bid was a big time contractor. After the contract was signed, he decided the piles were overkill. If this had been a Federal or State contract, it would never have happened, but since this was a city project, it was kind of hazy. There was an exchange of memos and somewhere in the paperwork, a city engineer agreed the piles were too much.

There was no formal change order, or addendum to the contract. The contractor simply built the concrete bucket without the piles.

As the last of the concrete was poured, the thing began to sink. It wasn't like a ship sinking, but it was enough to worry people. The design Engineer was called in to look at it and he said, "Yeah, that's why we said put it on piles." There was no easy solution. The choices were to either move over and build a new one, or to punch holes in the bottom and drive the piles. Neither choice was really viable. They finally decided to fill the bucket up with sand and wait to see how much it sank.

After about 6 months, it stabilized and quit sinking. They let it sit another 6 months. The diesel engines and the pumps were installed and it's been working fine for 40 years.

The problem came when the contractor wanted to be paid. There was a late penalty which was substantial, because the project was a year over due. There was a lot of bitching on the city council, but in the end, they all pretended the contractor had not tried to rob them, and paid the full bill.

At least that could be saved. I'm thinking of the Chinese apartment complex where they omitted the piles and it fell over one day.

 

[Canard DuJour]

Nah, I said the utiliy of safe bridges, not the utility of some bridge. The safe bit is specifically civil engineers' contribution and an alternative bridge to the one I'm on makes me value its safety no less.

The safety of the bridge is no more the engineer's sole work than the bridge itself is. Lots of people have to do their jobs in order for the bridge to be safe; besides which, the engineer spends her work time figuring out a lot of things besides how to make the bridge safe.

Now let's try that again without the equivocation..

"The safety of the bridge is no more the engineer's sole work specific contribution than the bridge itself is. Lots of people have to do their jobs in order for the bridge to be safe; besides which, the engineer spends her work time figuring out a lot of things besides how to make the bridge safe."​

..thus we see the first bit is wrong and the second irrelevant. The point was that wages for a specific contribution fluctuate independently of its consumer utility. Not that consumer utility can't change and bugger all to do with "sole work" in either sense. You have again constructed strawmen by deliberate misinterpretation of loose synonyms. This silly and tedious form of argumentation does you no favours.

You think you can quantify how much better you like a safe bridge than an unsafe one in monetary terms, and how [etc]

Besides, you seem to be assuming the alternative bridge is unsafe [etc]

No and no.

For that matter, why would you even think the utility of the bridge is unchanged by the rise in engineering availability? If people didn't have the bridge they'd have to make other arrangements. Like any other input, when engineering services become more available, that makes it easier for people to make other arrangements. So the consequence of not having the bridge becomes less harmful.

It might or might not. It's beside the point that civil engineers' wages will be bid down regardless.

In fact it's only "easier for people to make other arrangements" if there are more civil engineering projects. That tends to raise civil engineers' wages while - by your logic - reducing the consumer utility of their work.

There's no contradiction between consumers valuing the product less even while the input is getting valued more, because the one is not the cause of the other. Rather, a previous change causes both.

Yep, hence changing market rates for labour have no necessary relation to the consumer utility of finished product.

Welcome to equilibrium. The same process happens in economics as in mechanics, chemistry, what have you: a disturbance to a system tends to change the system in ways that will oppose the disturbance. In electromagnetism they call it Lenz's Law. In ksen's economic scenario the original disturbance was "an influx of civil engineers". That's what causes the market rate for them to go down, which reduces the incentive for more civil engineers to come. But the reduction in the price of civil engineering services also causes there to be more civil engineering projects, which tends to raise civil engineers' wages part way back to the original level.

It might or might not. Employers don't necessarily pass on the saving and, even if they do, roads and bridges don't get built just because they're cheap. Wages are bid down regardless.

But the increase in projects reduces the consumer utility of their work, which reduces the rate of new projects part way back to the original level. "And so on and so forth and such like." -- any disturbance will have dozens of effects propagating through the economy as it gradually restabilizes in a way that accommodates the original disturbance.

Squeeze a balloon and the balloon changes shape in a way that makes it push back harder on your hands. But the squeezing doesn't just change the shape; it also reduces the volume of the balloon. And a volume reduction by the same logic must make it push less hard on your hands. A contradiction?

Yes, the third sentence contradicts the first and is wrong.

No, just static equilibrium.

Disturbances also precipitate new equilibria. Squeeze yer balloon hard enough and it'll distend permanently or burst. Squeeze wages in general hard enough and there'll be fewer civil engineering projects as the economy settles into a below-capacity, demand-constrained equilibrium.

 

[Bomb#20]

Nah, I said the utiliy of safe bridges, not the utility of some bridge. The safe bit is specifically civil engineers' contribution and an alternative bridge to the one I'm on makes me value its safety no less.

The safety of the bridge is no more the engineer's sole work than the bridge itself is. Lots of people have to do their jobs in order for the bridge to be safe; besides which, the engineer spends her work time figuring out a lot of things besides how to make the bridge safe.

Now let's try that again without the equivocation..

"The safety of the bridge is no more the engineer's sole work specific contribution than the bridge itself is. Lots of people have to do their jobs in order for the bridge to be safe; besides which, the engineer spends her work time figuring out a lot of things besides how to make the bridge safe."​

..thus we see the first bit is wrong and the second irrelevant. The point was that wages for a specific contribution fluctuate independently of its consumer utility. Not that consumer utility can't change and bugger all to do with "sole work" in either sense. You have again constructed strawmen by deliberate misinterpretation of loose synonyms. This silly and tedious form of argumentation does you no favours.

I've been engaging with you because you replied to one of my posts in a way that made it sound like you wanted a substantive and mutually beneficial discussion of economic theory, in which you would either teach me something or learn something from me. Apparently I was wrong. Apparently you're just here to smear the opposition. You've decided I'm the enemy, and you don't give a rat's ass whether the things you say about enemies are true or not. You accuse me of deliberately misinterpreting what you wrote. I did no such thing. You did not have a reason to believe I did any such thing. You made that accusation up out of whole cloth. That's libel -- a false damaging accusation made with malice and reckless disregard for the truth. You are behaving unethically because you don't like me. Not liking someone is not an adequate reason to behave unethically. Stop doing it.

I have no idea what the distinction you're making between "sole work" and "specific contribution" is. Since you say "sole work" isn't what you meant by "specific contribution", I have no idea what you use the words "specific contribution" to mean. If that led me to make a counterargument that fails to refute you because it missed the point of your argument, that was an inadvertent mistake on my part -- a mistake I blame on your lack of clarity, and a mistake you should feel free to blame on my stupidity and my inability to understand plain English, if you imagine what you wrote was plain English. If you can live with that and you decide you want to actually discuss economic theory, we can proceed; but if you tell any more untruths about me I'll take it as proving that trying to teach you or learn from you will be a waste of my time.

thus we see the first bit is wrong and the second irrelevant.

I can't see the first bit is wrong since you haven't explained what "specific contribution" means. The second bit is relevant because we were talking about how valuable the civil engineer's work is. Surely the additional non-safety-related work she does counts toward that.

You think you can quantify how much better you like a safe bridge than an unsafe one in monetary terms, and how [etc]

Besides, you seem to be assuming the alternative bridge is unsafe [etc]

No and no.

It seems I've misunderstood you again. I wrote "If you propose to define the value of her engineering work based on measuring the utility of the bridge", and you corrected me "Nah, I said the utiliy of safe bridges, not the utility of some bridge." That appears to mean you propose to define the value of her engineering work based on measuring the utility of safe bridges. Do I have that right? So how can the utility of safe bridges tell you anything about how many dollars her engineering work is worth if you don't know how many dollars safe bridges are worth?

As for the second "no", you say "no" to my conclusion after snipping and not addressing the argument for it. You said "an alternative bridge to the one I'm on makes me value its safety no less.", so I asked, if bridge B is safe and you use bridge B half the time, why wouldn't that make you value the safety of bridge A less than if you always used it? If you aren't assuming bridge B is unsafe then why don't you consequently value bridge A's safety less? It would be rational for you to consequently value bridge A's safety less.

In fact it's only "easier for people to make other arrangements" if there are more civil engineering projects. That tends to raise civil engineers' wages while - by your logic - reducing the consumer utility of their work.

There's no contradiction between consumers valuing the product less even while the input is getting valued more, because the one is not the cause of the other. Rather, a previous change causes both.

Yep, hence changing market rates for labour have no necessary relation to the consumer utility of finished product.

True, they do not. Hey, we agree on something! But it sounds like you think it's possible for the pay rate for labor to have a fixed relation to the consumer utility of the finished product. That seems impossible to me, whether you use a market to determine wages or not, for reasons already explained.

Welcome to equilibrium. ... tends to raise civil engineers' wages part way back to the original level.

It might or might not. Employers don't necessarily pass on the saving and, even if they do, roads and bridges don't get built just because they're cheap. Wages are bid down regardless.

Indeed so -- that's what the "part way" part means. After the disturbance, all the exchange rates in the new equilibrium can be different.

Squeeze a balloon and the balloon changes shape in a way that makes it push back harder on your hands. But the squeezing doesn't just change the shape; it also reduces the volume of the balloon. And a volume reduction by the same logic must make it push less hard on your hands. A contradiction?

Yes, the third sentence contradicts the first and is wrong.

It's not wrong (assuming the balloon is full of air.) If you don't think the volume reduction makes it push less hard, try making the same deformation to a water balloon. The water is nearly incompressible so there's far less volume reduction; consequently the water balloon will push back harder on your hands than the air balloon.

To say the third sentence contradicts the first is incorrect reasoning. Suppose putting an ice cube in a cup of water makes the water cool off at 6 degrees per minute, and suppose putting the cup on the stove makes it heat up at 10 degrees per minute. To say the third sentence contradicts the first is pretty much the same as saying "it heats up at 10 degrees per minute" contradicts "it cools off at 6 degrees per minute" and therefore if you put a cup of water with an ice cube in it on the stove then the universe will disappear in a puff of logic. That's not how the universe deals with opposing forces. The two effects just sum. 10 + -6 = 4, so if you put a cup of water with an ice cube in it on the stove then the water will just heat up at 4 degrees per minute. Squeezing an air balloon has two consequences and one makes it push back harder while the other makes it push back less hard, so the two effects just sum -- it pushes back harder than before but not as hard as a water balloon would. An influx of civil engineers has two consequences, so the two effects just sum -- wages drop, but they don't drop as much as they would have dropped if there weren't more civil engineering projects as a result.

No, just static equilibrium.

Disturbances also precipitate new equilibria. Squeeze yer balloon hard enough and it'll distend permanently or burst. Squeeze wages in general hard enough and there'll be fewer civil engineering projects as the economy settles into a below-capacity, demand-constrained equilibrium.

Quite possibly. Macroeconomics is complicated. If you're arguing that wages should be influenced by other things in addition to supply and demand, quite possibly -- I haven't seen anybody in this thread claiming the market rate is always optimal, whatever the heck "optimal" would mean. My point was that most of the arguments against supply and demand appear to be based on incoherent concepts of value. That of course doesn't touch arguments for bringing some third factor to bear on wages if, for example, it can be shown that doing so would increase GDP.

 

[whichphilosophy]

Nah, I said the utiliy of safe bridges, not the utility of some bridge. The safe bit is specifically civil engineers' contribution and an alternative bridge to the one I'm on makes me value its safety no less.

The safety of the bridge is no more the engineer's sole work than the bridge itself is. Lots of people have to do their jobs in order for the bridge to be safe; besides which, the engineer spends her work time figuring out a lot of things besides how to make the bridge safe.

Now let's try that again without the equivocation..

"The safety of the bridge is no more the engineer's sole work specific contribution than the bridge itself is. Lots of people have to do their jobs in order for the bridge to be safe; besides which, the engineer spends her work time figuring out a lot of things besides how to make the bridge safe."​

..thus we see the first bit is wrong and the second irrelevant. The point was that wages for a specific contribution fluctuate independently of its consumer utility. Not that consumer utility can't change and bugger all to do with "sole work" in either sense. You have again constructed strawmen by deliberate misinterpretation of loose synonyms. This silly and tedious form of argumentation does you no favours.

I've been engaging with you because you replied to one of my posts in a way that made it sound like you wanted a substantive and mutually beneficial discussion of economic theory, in which you would either teach me something or learn something from me. Apparently I was wrong. Apparently you're just here to smear the opposition. You've decided I'm the enemy, and you don't give a rat's ass whether the things you say about enemies are true or not. You accuse me of deliberately misinterpreting what you wrote. I did no such thing. You did not have a reason to believe I did any such thing. You made that accusation up out of whole cloth. That's libel -- a false damaging accusation made with malice and reckless disregard for the truth. You are behaving unethically because you don't like me. Not liking someone is not an adequate reason to behave unethically. Stop doing it.

I have no idea what the distinction you're making between "sole work" and "specific contribution" is. Since you say "sole work" isn't what you meant by "specific contribution", I have no idea what you use the words "specific contribution" to mean. If that led me to make a counterargument that fails to refute you because it missed the point of your argument, that was an inadvertent mistake on my part -- a mistake I blame on your lack of clarity, and a mistake you should feel free to blame on my stupidity and my inability to understand plain English, if you imagine what you wrote was plain English. If you can live with that and you decide you want to actually discuss economic theory, we can proceed; but if you tell any more untruths about me I'll take it as proving that trying to teach you or learn from you will be a waste of my time.

thus we see the first bit is wrong and the second irrelevant.

I can't see the first bit is wrong since you haven't explained what "specific contribution" means. The second bit is relevant because we were talking about how valuable the civil engineer's work is. Surely the additional non-safety-related work she does counts toward that.

You think you can quantify how much better you like a safe bridge than an unsafe one in monetary terms, and how [etc]

Besides, you seem to be assuming the alternative bridge is unsafe [etc]

No and no.

It seems I've misunderstood you again. I wrote "If you propose to define the value of her engineering work based on measuring the utility of the bridge", and you corrected me "Nah, I said the utiliy of safe bridges, not the utility of some bridge." That appears to mean you propose to define the value of her engineering work based on measuring the utility of safe bridges. Do I have that right? So how can the utility of safe bridges tell you anything about how many dollars her engineering work is worth if you don't know how many dollars safe bridges are worth?

As for the second "no", you say "no" to my conclusion after snipping and not addressing the argument for it. You said "an alternative bridge to the one I'm on makes me value its safety no less.", so I asked, if bridge B is safe and you use bridge B half the time, why wouldn't that make you value the safety of bridge A less than if you always used it? If you aren't assuming bridge B is unsafe then why don't you consequently value bridge A's safety less? It would be rational for you to consequently value bridge A's safety less.

In fact it's only "easier for people to make other arrangements" if there are more civil engineering projects. That tends to raise civil engineers' wages while - by your logic - reducing the consumer utility of their work.

There's no contradiction between consumers valuing the product less even while the input is getting valued more, because the one is not the cause of the other. Rather, a previous change causes both.

Yep, hence changing market rates for labour have no necessary relation to the consumer utility of finished product.

True, they do not. Hey, we agree on something! But it sounds like you think it's possible for the pay rate for labor to have a fixed relation to the consumer utility of the finished product. That seems impossible to me, whether you use a market to determine wages or not, for reasons already explained.

Welcome to equilibrium. ... tends to raise civil engineers' wages part way back to the original level.

It might or might not. Employers don't necessarily pass on the saving and, even if they do, roads and bridges don't get built just because they're cheap. Wages are bid down regardless.

Indeed so -- that's what the "part way" part means. After the disturbance, all the exchange rates in the new equilibrium can be different.

Squeeze a balloon and the balloon changes shape in a way that makes it push back harder on your hands. But the squeezing doesn't just change the shape; it also reduces the volume of the balloon. And a volume reduction by the same logic must make it push less hard on your hands. A contradiction?

Yes, the third sentence contradicts the first and is wrong.

It's not wrong (assuming the balloon is full of air.) If you don't think the volume reduction makes it push less hard, try making the same deformation to a water balloon. The water is nearly incompressible so there's far less volume reduction; consequently the water balloon will push back harder on your hands than the air balloon.

To say the third sentence contradicts the first is incorrect reasoning. Suppose putting an ice cube in a cup of water makes the water cool off at 6 degrees per minute, and suppose putting the cup on the stove makes it heat up at 10 degrees per minute. To say the third sentence contradicts the first is pretty much the same as saying "it heats up at 10 degrees per minute" contradicts "it cools off at 6 degrees per minute" and therefore if you put a cup of water with an ice cube in it on the stove then the universe will disappear in a puff of logic. That's not how the universe deals with opposing forces. The two effects just sum. 10 + -6 = 4, so if you put a cup of water with an ice cube in it on the stove then the water will just heat up at 4 degrees per minute. Squeezing an air balloon has two consequences and one makes it push back harder while the other makes it push back less hard, so the two effects just sum -- it pushes back harder than before but not as hard as a water balloon would. An influx of civil engineers has two consequences, so the two effects just sum -- wages drop, but they don't drop as much as they would have dropped if there weren't more civil engineering projects as a result.

No, just static equilibrium.

Disturbances also precipitate new equilibria. Squeeze yer balloon hard enough and it'll distend permanently or burst. Squeeze wages in general hard enough and there'll be fewer civil engineering projects as the economy settles into a below-capacity, demand-constrained equilibrium.

Quite possibly. Macroeconomics is complicated. If you're arguing that wages should be influenced by other things in addition to supply and demand, quite possibly -- I haven't seen anybody in this thread claiming the market rate is always optimal, whatever the heck "optimal" would mean. My point was that most of the arguments against supply and demand appear to be based on incoherent concepts of value. That of course doesn't touch arguments for bringing some third factor to bear on wages if, for example, it can be shown that doing so would increase GDP.

Having worked on several contracts over the years, when interviewed by decision makers without HR, the wages have been very high. When HR has been involved, it involved more discussions and in some cases the contract contradicted the agreements in the offer (downwards of course). Downsize HR departments to that of a basic admin and filing function and recruitment will be faster and wages higher. What some fail to understand is the cost of an employee is not as important as the value. An engineer who knows the specs codes and standards and can produce a safe bridge that is fit for purpose is senior to those who spend thousands of hours monkeying with the designs to try and figure out certain parameters which were already established years before. (I see this quite often in Civil and oil and gas construction projects, especially outside of Europe).

 

[Canard DuJour]

I've been engaging with you because you replied to one of my posts in a way that made it sound like you wanted a substantive and mutually beneficial discussion of economic theory, in which you would either teach me something or learn something from me. Apparently I was wrong. Apparently you're just here to smear the opposition. You've decided I'm the enemy, and you don't give a rat's ass whether the things you say about enemies are true or not. You accuse me of deliberately misinterpreting what you wrote. I did no such thing. You did not have a reason to believe I did any such thing. You made that accusation up out of whole cloth. That's libel -- a false damaging accusation made with malice and reckless disregard for the truth. You are behaving unethically because you don't like me. Not liking someone is not an adequate reason to behave unethically. Stop doing it.

I have no idea what the distinction you're making between "sole work" and "specific contribution" is. Since you say "sole work" isn't what you meant by "specific contribution", I have no idea what you use the words "specific contribution" to mean. If that led me to make a counterargument that fails to refute you because it missed the point of your argument, that was an inadvertent mistake on my part -- a mistake I blame on your lack of clarity, and a mistake you should feel free to blame on my stupidity and my inability to understand plain English, if you imagine what you wrote was plain English. If you can live with that and you decide you want to actually discuss economic theory, we can proceed; but if you tell any more untruths about me I'll take it as proving that trying to teach you or learn from you will be a waste of my time.

I can't see the first bit is wrong since you haven't explained what "specific contribution" means. The second bit is relevant because we were talking about how valuable the civil engineer's work is. Surely the additional non-safety-related work she does counts toward that.

If you really think I meant "sole work" in either sense, sorry but any clarification would involve words with synonyms equally open to misinterpretation. So you're not going to have "a substantive and mutually beneficial discussion", but your usual interminable to-and-fro about who said what when and they meant by it. No one's interested.

It seems I've misunderstood you again. I wrote "If you propose to define the value of her engineering work based on measuring the utility of the bridge", and you corrected me "Nah, I said the utiliy of safe bridges, not the utility of some bridge." That appears to mean you propose to define the value of her engineering work based on measuring the utility of safe bridges. Do I have that right?

No, it means the difference between the utility of a safe bridge designed by an engineer and something that just look like one.

So how can the utility of safe bridges tell you anything about how many dollars her engineering work is worth if you don't know how many dollars safe bridges are worth?

It can't in system of wage labour. That's kinda the point.

As for the second "no", you say "no" to my conclusion after snipping and not addressing the argument for it. You said "an alternative bridge to the one I'm on makes me value its safety no less.", so I asked, if bridge B is safe and you use bridge B half the time, why wouldn't that make you value the safety of bridge A less than if you always used it?

Are you serious? Because the safety of a bridge other than the one that collapses under me does nothing to ubreak my neck and undrown me.

If you aren't assuming bridge B is unsafe then why don't you consequently value bridge A's safety less? It would be rational for you to consequently value bridge A's safety less.

I'm not even going to speculate as to why you think so.

True, they do not. Hey, we agree on something! But it sounds like you think it's possible for the pay rate for labor to have a fixed relation to the consumer utility of the finished product. That seems[..etc]

No.

Indeed so -- that's what the "part way" part means. After the disturbance, all the exchange rates in the new equilibrium can be different.

It's not wrong (assuming the balloon is full of air.) If you don't think the volume reduction makes it push less hard, try making the same deformation to a water balloon. The water is nearly incompressible so there's far less volume reduction; consequently the water balloon will push back harder on your hands than the air balloon.

To say the third sentence contradicts the first is incorrect reasoning. Suppose putting an ice cube in a cup of water makes the water cool off at 6 degrees per minute, and suppose putting the cup on the stove makes it heat up at 10 degrees per minute. To say the third sentence contradicts the first is pretty much the same as saying "it heats up at 10 degrees per minute" contradicts "it cools off at 6 degrees per minute" and therefore if you put a cup of water with an ice cube in it on the stove then the universe will disappear in a puff of logic. That's not how the universe deals with opposing forces. The two effects just sum. 10 + -6 = 4, so if you put a cup of water with an ice cube in it on the stove then the water will just heat up at 4 degrees per minute. Squeezing an air balloon has two consequences and one makes it push back harder while the other makes it push back less hard, so the two effects just sum -- it pushes back harder than before but not as hard as a water balloon would.

The cup of water thing isn't analagous. Neither is the difference between sqeezing a volume of water and air. Squeezing a volume of water (or air or whatever) in no sense "makes it push less hard."

An influx of civil engineers has two consequences, so the two effects just sum -- wages drop, but they don't drop as much as they would have dropped if there weren't more civil engineering projects as a result.

There might or might not be "more civil engineering projects as a result". Employers don't necessarily pass on the saving and, even if they do, roads and bridges don't get built just because they're cheap. Wages are bid down regardless.

Quite possibly. Macroeconomics is complicated. If you're arguing that wages should be influenced by other things in addition to supply and demand, quite possibly -- I haven't seen anybody in this thread claiming the market rate is always optimal, whatever the heck "optimal" would mean. My point was that most of the arguments against supply and demand appear to be based on incoherent concepts of value. That of course doesn't touch arguments for bringing some third factor to bear on wages if, for example, it can be shown that doing so would increase GDP.

No, I'm talking about how wages affect supply and demand. I don't think any particular "ought" can be derived, just a set of conflicting class interests. Nothing to do with "arguments against supply and demand"

 

[whichphilosophy]

That only works if there is a monopoly. In a competitive market, instead of pocketing all of the difference, a firm that is paying its engineers $60k instead of $80k will be able to outbid the companies that don't. This creates pressure in the other companies to reduce wages as well and eventually a new equilibrium is reached.

And remember, competition only works to drive down wages, never to drive up wages. Any disparity is only and always at the cost of the worker. Never has demand for labor increased wages.

This is a common misconception. Wages are only one factor Skills in both organisation to cut operating costs and improve efficiency and higher quality engineering (if we are talking about engineering) will save a company millions on a project.

 

[Harry Bosch]

And remember, competition only works to drive down wages, never to drive up wages. Any disparity is only and always at the cost of the worker. Never has demand for labor increased wages.

This is a common misconception. Wages are only one factor Skills in both organisation to cut operating costs and improve efficiency and higher quality engineering (if we are talking about engineering) will save a company millions on a project.

I think that Jason was being ironic here.

 

[Bomb#20]

... If you can live with that and you decide you want to actually discuss economic theory, we can proceed; but if you tell any more untruths about me I'll take it as proving that trying to teach you or learn from you will be a waste of my time. ...

If you really think I meant "sole work" in either sense, sorry but any clarification would involve words with synonyms equally open to misinterpretation. So you're not going to have "a substantive and mutually beneficial discussion", but your usual interminable to-and-fro about who said what when and they meant by it. No one's interested.

Looks like we're done here. Sayonara.

 

[arkirk]

This is a common misconception. Wages are only one factor Skills in both organisation to cut operating costs and improve efficiency and higher quality engineering (if we are talking about engineering) will save a company millions on a project.

I think that Jason was being ironic here.

Engineers are not laborers. Disparity is pretty much at the cost of the worker, but I don't know why Jason would care about that. Demand in a globalized world leads to a lot of travel for people seeking cheap labor in every quarter of the globe....that keeps costs down but increases the carbon footprint of everything produced. It also then leads to decreased demand because people who are unemployed do not buy anything.

 

[Jason Harvestdancer]

This is a common misconception. Wages are only one factor Skills in both organisation to cut operating costs and improve efficiency and higher quality engineering (if we are talking about engineering) will save a company millions on a project.

I think that Jason was being ironic here.

I was afraid someone would miss the sarcasm.