12-20-2016, 01:57 PM
(12-18-2016, 03:46 PM)Warren Dew Wrote:(12-17-2016, 04:17 PM)Mikebert Wrote:(10-28-2016, 12:16 PM)Warren Dew Wrote: I wonder if there's still a connection to demographics. Even in an industrial society, population growth should result in oversupply of labor and a decrease in the wage to capital ratio.
Why?
Basic economics. Natural population growth results in an increase in the number of people of working age, and thus in the supply of labor. Since it doesn't increase the supply of capital, that makes labor relatively more plentiful and thus less valuable. Wages will fall, while the return on capital will rise.
Randians such as yourself tend to forget the Keynesian truths. Population growth provides more customers for business, which then grows and expands and becomes more profitable, increasing wages along with it. That's why business and labor have insisted on growth for 2 centuries now.