https://doctorow.medium.com/mbas-and-wage-stagnation-3eff0bf7d0df
"Before the Great Resignation, there was the Great Stagnation, a 40-year
relentless decline in workers’ compensation, no matter whether the economy was
booming or busting. This was a sharp change from the historical norm in which
rising profitability translated to rising wages.
There are lots of explanations for wage stagnation. The most obvious one is the
decline of unions, which is the result of changes to labor law that makes it
much harder to form a union, win a contract, and enforce that contract (this,
in turn, is largely the fault of the Democrats’ abandonment of labor causes in
a bid to appeal to the professional and managerial class, which created a
bipartisan, anti-union coalition).
But in “Eclipse of Rent-Sharing: The Effects of Managers’ Business Education on
Wages and Labor Share in the US and Denmark,” a March 2022 National Bureau for
Economic Research paper, Daron Acemoglu (MIT econ), Alex He (U Maryland
business), and Daniel le Maire (U Copenhagen econ), we get a more complex
explanation:
https://www.nber.org/system/files/working_papers/w29874/w29874.pdf
The paper makes a somewhat nuanced and technically complex argument, but let me
paraphrase its conclusion: Going to business-school makes you the kind of
person who cuts wages in bad times and refuses to increase wages in good times.
When companies are run by MBAs, their workers’ wages decline."
Cheers,
*** Xanni ***
--
mailto:xanni@xanadu.net Andrew Pam
http://xanadu.com.au/ Chief Scientist, Xanadu
https://glasswings.com.au/ Partner, Glass Wings
https://sericyb.com.au/ Manager, Serious Cybernetics
