Monday, December 4, 2017

Currency risk accumulation in government fees on labor

Aggregate productivity and the rise of mark-ups

Markup on goods have been increasing, and determined, or assumed to be markups on labor.  Here is the cause.

Government insures labor, it insures them with inflation protection and unemployment insurance and social insurance.  These appear as flat fees on labor, and business needs labor elasticity because business is doing real goods term transformation, a volatile activity.   Business cannot always justify the government fees on labor, it robs them of elasticity, they cannot control the risk of labor losses.


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