Economic Nonsense: 48. Labour Unions are essential to improve wages and conditions for workers

It is actually improved productivity, not labour unions, that has improved the rewards of labour.  People earned less money in former times because productivity was low.  People were paid according to the worth of their input into the production process.  When each worker contributed little, they were low paid.  As technology and production methods improved, […]

Maybe Keynes was right after all?

It has to be said that we’re not great fans of macroeconomics around here. Not enough good data from enough different places to definitively answer most questions: and that’s before we get onto Hayek’s point about simply not being able to calculate the economy without using the economy itself to do so. However, this makes […]

Pay is determined by your best alternative job

Economic theory tells us that we really ought to be paid our marginal productivity. And no one at all believes that that actually happens in detail. However, we can take a step back to a point which even Karl Marx got, which is that your pay will reflect the demand for labour. More specifically, the […]

As we’ve said before there’s something a little odd about UK inequality

We’re often told that the UK is one of the most unequal countries in Europe. We’re also often told that this is bad, very bad, and something must be done. We’ve pointed out a number of times that there’s another difference in the UK economy, something that makes us rather different from other European economies. […]

The problem with low pay

The Resolution Foundation tells us that there’s some great big problem with low pay in the UK. Looking at their actual statistics though it’s difficult to see what the problem is. Of course, everyone would like more money for whatever it is that they do. But what keeps people in those low pay jobs seems […]