this link … http://www.perc.org/pdf/ps28.pdf contains an article about market distortions and costs of municap recycling operations and makes comaprisons to ‘private’ material recycling and reuse.
i found this excerpt of interest "In a similar vein, 50 years ago, when labor was relatively cheap
compared to materials, goods were built to be repaired, so that the
expensive materials could be used for a longer period of time. As
the price of labor has risen and the cost of materials has fallen, manufacturers
have responded…"
i was wondering how these claims mesh with austrian views on monetary inflation causing price increases.
material prices falling…labor prices rising? amongst rising inflation??
my first thought was of a scenario where … take timber for the material…donkeys used to haul timber out of forests by donkey drivers…they were sturdy animals but were lightweights and couldnt haul much…horses were around but used a lot of feed and were valuble for other uses…one timber man just goofing around breeds a donkey and a horse and the result is the ‘DORSE’ … the DORSE can pull over twice the timber of a donkey and is more durable than the horse and requires less feed.
timber sales begin to increase due the reduced cost of extracting timber from the forest because of using the DORSE.
directing the DORSE is only slighty more difficult than directing the donkeys due to their temperment but itis still basically slapping reigns on an animal and making vocal calls.
in this case…i assume ‘hiring’ DORSES is really just a capital cost and not a labor cost.
since i cant see how labor costs really rose but material costs fell do to greater effiency, is the aobve excerpt correct in stating "As the price of labor has risen and the cost of materials has fallen…‘’’
i am unsure of why labor costs would outpace materials costs. what could dcause this?
is what i have described here consistent with what has taken place in the real economy?
is this an instance where prices of materials can decline in spite of monetary inflation?
would monetary inflation only impede this process of enahncing effiiency?
input and clarification would be appreciated
sthomper