re: Waffle House workers are the latest group to strike, requesting $25 per hour

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Maybe learn a trade instead of bitching about your current lot in life, do something about it.

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Short-order cook is not a trade?

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Market price is the price where supply and demand curves meet. Its not the actual price. It determines producer or consumer surplus.


Labor affects the supply curve, you dummy.

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Labor certainly effects the supply curve. If demand for labor goes up and supply of labor goes down the market price for labor, like the market price for any good or service, will increase. The resulting increase in production costs does not mean that there will be ANY increase in the market price of the goods or services that labor is producing....the market prices for the goods or services, just like the market prices for the labor, is based on supply and demand, not production costs.


A good example would be a company with an aging workforce in an industry that is physically demanding on employees. That company is most likely going to have higher production costs than a similar company with a younger workforce with the physical attributes required to function efficiently. Lets say it is a 90 year old man and a 25 year old man digging ditches. The older man is probably going to take longer. If their wages are the same the younger man's production costs would be lower. No one would expect the market price to reflect the higher production costs...because the market price for a ditch delivered is based on supply and demand, not the cost of digging the damned ditch. If you can dig it for a nickel and no one wants to buy it the market value is the same as it would be if it cost you $500 to dig it....

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I've always wanted to be a cook.

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Well, apparently as long as you don't chop any fingers off or catch your face on fire you should get $25/hour at Waffle House.

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Labor certainly effects the supply curve.


How can that be, if labor does not affect market prices?

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If supply goes down because of a lack of labor and demand remains constant market prices will increase and drive down demand if there is an alternative product or service. If the cost of labor goes up or down it has no impact on labor supply and no impact on supply nor demand nor any impact on market price. If it did there would be no need to manage labor costs...just let them run rampant, the market price will go up as wages go up with no ceiling apparently.


You keep stating that labor costs impact market price. You have yet to state why managing labor costs is imperative if that is the case. You will not do this because you know full well it is important because what it does impact is the concerns viability, not the market price of the concerns goods or services...the only input into that price is supply and demand.

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If supply goes down because of a lack of labor and demand remains constant market prices will increase

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At least you understand that.

What happens if labor cost increase to the employer in a competitive market? Unilaterally?

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At least you understand that.

What happens if labor cost increase to the employer in a competitive market? Unilaterally?

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Unilaterally? I am assuming you mean every employer in the competitive market has an increase in labor costs? In any case all manner of shite can happen. They can find ways to save on labor...invest in technology, hire less experienced labor, they may well lay off some labor however if they did that because of an increase in labor costs and it does not negatively impact their production they were not properly managing labor costs to begin with.

If they are in a position that they can't do with less labor and must pay the increased labor costs they can handle it in a couple of ways. They can lower their expectations as far as margins go OR they can try to raise prices. If they are able to raise prices without negatively impacting their market share they were underpriced according to the market price without the increase in labor costs which means the business was mismanaged at the very base of its structure and the increase in wages merely corrected the mistakes of management. What categorically will not change due to an increase in production costs, unilaterally or otherwise, is an increase in market price...because production costs vary according to management practices. There is no industry so generic that operating costs are identical from one producer to the next....that is what management's job is, manage costs and maximize profit. If you can raise prices without negatively impacting your revenue you were mismanaging your business.

Again, however, the idea that Waffle House experiencing an increase in labor costs will somehow result in an increase in the market price of the goods and services waffle house provides is ludicrous.

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Unilaterally? I am assuming you mean every employer in the competitive market has an increase in labor costs? In any case all manner of shite can happen

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Increase prices or cut staff will be the primary reaction. When labor prices increase and all else remains the same, employers purchase less labor.

I support this

Why am I not surprised?