(no title)
tottenhm | 5 years ago
Let's make an example. Suppose a "rational investor" in a globalized market is considering whether to manufacture a commodity in San Francisco or Jaipur.
The cost of living in San Francisco is 200%-2000% higher than the cost of living in Jaipur.
https://www.numbeo.com/cost-of-living/compare_cities.jsp?cou...
The rational, by-the-numbers move is to put the factory in Jaipur because exchange rates make it radically cheaper. That's the real driver. Even if the would-be workers in SF made every conscionable concession and slogged for 25 hours a day, it wouldn't overcome the currency differences. Even if the workers in Jaipur had the most generous PTO and the most corrupt union boss, it wouldn't overcome the currency differences.
Of course, if you were pitching a town in South Carolina against a town in Pennsylvania, then maybe you'd consider numerically small differentiators like "how much extra do you have to pay for the 9th hour of work" - because small differentiators are the only differentiators available.
But that's not the issue with globalization. "Globalization" doesn't mean "moved from PA to SC to trim wages by 5% via lax overtime rules". It means they moved to Vietnam or China or Bangladesh to change the basic unit of measure with an aim to slash labor costs by 50% or 80%.
DuskStar|5 years ago
Why on earth do you assume that this is unrelated to workers protections? These protections aren't a bad thing, but to ignore their negative impacts can be shortsighted...