Seller "α" sells products. Wanting to help customers, and not having anything else to do, "α" increases production and lowers prices in an attempt to get more sales.
β buys from α. Due to lower prices, β spends less money. Because they are using the accelerated work week, they are then able to choose to work less and earn slightly less money due to lower expenses. This lets β's coworker, γ, work slightly more and earn more money.
Because γ is not as good of a worker and not as efficient as β, γ has to spend more time working to do what β was previously doing, but because the business is aware of this γ is paid at a lower average wage rate and the cost to the business is the same. In a large enough business, there will always be someone who would prefer to work and earn more at any point in time so there will always be a γ.
It doesn't matter what γ does with their money. Maybe they spend it on the casinos in Las Vegas. Maybe they gamble it away in the financial markets. Maybe they use it to buy luxury goods like Louis Vuitton. The point of the accelerated work week is to ensure that plenty of people are willing to work less if they earn lots of money which means there are no ways of spending money that are harmful to the economy — as opposed to the environment.
δ also buys from α. However, when δ saves money due to α's lower prices, they don't decide to work less. Because people with lots of money tend to eat the same amount of food as people with less money and often (if they're male... sorry :P) buy the same number of pants, if they end up with more money than they planned they will probably spend it on luxury brands or invest it in the financial markets.
(Apparently these are some relevant books:
- Where Are the Customers' Yachts? Or, A Good Hard Look at Wall Street
- The Money Game
- The Richest Man in Babylon)
Then you have ε, who sells luxury brands, and ζ who specializes in the financial markets — maybe they work with clients, maybe they give free advice on a popular website, or maybe they're just a "quant" who makes money from technical analysis of price movements instead of by choosing and investing in promising companies. An important point is that no matter how much money ε and ζ have, they are not going to spend more on α's products than the price that α charges. So while by working harder they end up selling more to γ and δ, this doesn't help α at all except, possibly, by increasing 'GDP' and the taxes they pay so that α can pay lower taxes.
But if α really cared about how much money they had, they could just raise their prices (or if unemployed, they could support this). β would end up working more, γ would have less work to do unless something else changed, δ would also spend more on α's product and so ε and ζ would end up with less business and less money.
On the other hand, maybe when γ works more they use that money to buy food or essential health care. If β was like δ and just spent the savings from α's lower prices on luxury brands and investing in the financial markets, then γ wouldn't be able to buy these things.
If α wants to help γ, someone they have never met, instead of trying to figure out whether to raise or lower their prices they just need to support the use of the accelerated work week so β can work less when α lowers their prices, allowing γ the opportunity to earn more.
No comments:
Post a Comment