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Real income can not have a simple relation to productivity. Even if politics and policy allowed real wages to track worker productivity there are other limits to real income. Total output is the product of labor productivity, hours worked, and the number of workers. Since total output is now limited by resource scarcity, rising productivity must result in fewer workers and/or fewer hours per worker. (trading services must not be confused with producing necessary physical output) As the global scale of consumption presses on resources any additional increase in productivity can not result an increase in total real income. The assumption that labor is the weak link in the economy is no longer true, but that assumption is so deeply embedded in our culture and our theories that it seems that any adjustments to our new circumstances will be too little and too late. Don't abandon the old theories just yet. Someday after chaos and scarcity reduce productivity and population, the old theories about labor scarcity and resource abundance will be true once more. Barry ________________________________________________ Send list submissions to: Marxism@lists.econ.utah.edu Set your options at: http://lists.econ.utah.edu/mailman/options/marxism/archive%40mail-archive.com
