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I assume WH Hutt is referring to long-term effects. Here's what I understand. If "the price of any commodity is raised above the free market level by strike threat or action or by state edict," so that the price is above marginal cost. Then firms earn a "free" mark-up (=price - marginal cost) and need not be as productive as in a competitive market. As a ...


My understanding is that Piketty uses the term "P90/P10" only to measure wage inequality and the term "C90/C10" for wages plus social charges. The underlying distributions are different, but they both measure the ratio of the 90th percentile to the 10th percentile.


JIC people still read this, When adding one additional worker, ΔProfit=ΔRevenue-ΔCost =(P*MPL)-W & since firms are going to produce where profit is maximised, which is where it is no longer profitable to hire any more workers, ΔRevenue=0 Hence, 0=P*MPL-W, W/P=MPL.


Good question! Here Acemoglu and Restrepo discuss one of the many possible effects of automation, such that automation is likely to induce additional usage of capital in the sector or additional capital accumulation, which can increase labor demand. They elaborate on this effect on their 2018 AER paper "The Race between Man and Machine: Implications of ...

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