Population growth - labour shortage/surplus?

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shazlikd

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Nov 21, 2016, 11:49:32 AM11/21/16
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I was hoping to get some help here.  Possibly an explanation from someone with some sound knowledge and expertise in economics.

I've previously watched this video:

The Costs of Capitalism's Crisis: Who Will Pay?

https://www.youtube.com/watch?v=_-KqeU8nzn4

Absolutely brilliant speech.
I strongly agree with the comments made by Professor Richard Wolff. In particular, his comments regarding how America was constantly experiencing an ongoing labour shortage up until about 1970.  But while I agree with the points put forward by Professor Wolff, my logic tells me that population size/growth must have something to do with this labour equation, but this is not discussed at all.  I am hoping someone can explain to me, in logical economic terms, if/how population growth affects a labour shortage or surplus.
This is something I am trying to get my head around, where I'd really appreciate an explanation.

Robert Fireovid

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Nov 22, 2016, 3:55:54 AM11/22/16
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The econometric proxy for labor shortage/surplus is price, i.e., wages. Here's an essay you can start with... http://cis.org/Richwine-wages-Mariel
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shazlikd

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Nov 22, 2016, 6:53:01 PM11/22/16
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Bob,


Much appreciate the reply - thankyou.

Unfortunately, I found the article somewhat confusing.  It seemed to say that immigration (i.e. population growth) had a negative effect on wages, but I can't be sure.

My understanding is that any economy is based on the availability and access to wealth/land/natural resources, and this is what establishes a foundation for the economy, where the wealth then flows on from there (is distributed).  While you need a certain quantity of labour (i.e. employees) to enable businesses to operate, this has been achieved many decades (or centuries) ago in most developed countries.

  • If a nation only trades internally, it is my understanding that having a larger population size increases efficiencies (due to the economy of scale)....but only up to a point.
  • But if the economy in question raises most of it's wealth from the exporting of raw materials (i.e. primary industry - agriculture and mining), then it's my understanding that any increase in population size, whether from domestic birth rates or immigration, does nothing to "boost the wealth" within that nation/region.  All that occurs in this scenario, where the population increases, is that the cost of land/capital increases, while wages decrease.  A simple supply-demand equation.

I live in Australia where we're in the latter of the two scenarios mentioned above.

Please understand this is my analysis of the situation.  Am I (more or less) correct in my analysis?



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Karam, Prof. Ghassan Elias

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Nov 22, 2016, 10:22:45 PM11/22/16
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Robert,

              There are many studies that arrive, more or less, at the same conclusion as Prof. Wolff. Real wages, in general, had a secular upward trend in the US until 1979. Wages for the lower and middle class have stagnated since then.The productivity increased at a rapid rate but wages did not for the simple reason that the required level of production could be achieved with fewrer labourers. This is the same as having excess labour which is often reflected in excess unemployment. This trend has continued since the late seventies and has been helped by lack of unionization, undocumented immigrants and trade. 


Ghassan Karam
Economics Department, Pace University
Pleasantville NY 10570

"Nature, like liberty, has no price tag"

From: steady...@googlegroups.com <steady...@googlegroups.com> on behalf of shazlikd <daniel....@gmail.com>
Sent: Tuesday, November 22, 2016 6:53 PM
To: SteadyStaters
Subject: Re: Population growth - labour shortage/surplus?
 

shazlikd

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Nov 23, 2016, 2:05:10 AM11/23/16
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Ghassan,

Thankyou for the reply - much appreciated.
I realise that with economics, there are a range of issues at play.  But there is one very specific issue I am trying to figure out:
If you increase the population in a given region, does this ultimately lead to a labour surplus?


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