In this comic, the owner is acting greedily to the point of heavily antagonizing their workers. Draconian exploitation of the workforce, reneging on previous agreements, and not adequately compensating them is irrational.
One of the fallacies with Rand’s “moral objectivism” is the assumption that business owners will act rationally in their logical self interest in negotiations with their labor force and not out of spite, malice, sadism, racism, etc.
I was told by my first economics professor that if I could solve that problem, and eliminate the assumption of rationality, I’d be the richest man on earth over night.
It’s a problem, they know it’s a problem, they just don’t have a better answer.
You can’t even assume everyone can agree on the same definition of rational. If a business owner is a sadist they might value treating their employees like dirt more than the money they’d make if the business ran more efficiently. For a dickhead, rational self interest could mean forgoing profit to cause misery.
Rational in the economics sense just means that people do things for a reason. We’re not acting randomly, we believe that when we put money towards a thing that we are receiving something of value for it.
Any more specific than that and we’re not talking about rationality in the economics sense any more. Rationality does not mean correct. Just with cause.
It would certainly help explain middle management’s obsession with return-to-office policies in the face of all the evidence that WFH increases productivity.
Add greed and self-interest to that list. Those leaders and owners like CEOs are beholden to investors and shareholders, and if they demand a return on their investment or the C-suite wants a raise, the workforce will be one of the places the value is extracted from.
In this comic, the owner is acting greedily to the point of heavily antagonizing their workers. Draconian exploitation of the workforce, reneging on previous agreements, and not adequately compensating them is irrational.
One of the fallacies with Rand’s “moral objectivism” is the assumption that business owners will act rationally in their logical self interest in negotiations with their labor force and not out of spite, malice, sadism, racism, etc.
One of the problems with economic theory in general is assuming rational actors.
I was told by my first economics professor that if I could solve that problem, and eliminate the assumption of rationality, I’d be the richest man on earth over night.
It’s a problem, they know it’s a problem, they just don’t have a better answer.
You can’t even assume everyone can agree on the same definition of rational. If a business owner is a sadist they might value treating their employees like dirt more than the money they’d make if the business ran more efficiently. For a dickhead, rational self interest could mean forgoing profit to cause misery.
Rational in the economics sense just means that people do things for a reason. We’re not acting randomly, we believe that when we put money towards a thing that we are receiving something of value for it.
Any more specific than that and we’re not talking about rationality in the economics sense any more. Rationality does not mean correct. Just with cause.
This sounds like the metric for hiring middle-management if anything.
It would certainly help explain middle management’s obsession with return-to-office policies in the face of all the evidence that WFH increases productivity.
Add greed and self-interest to that list. Those leaders and owners like CEOs are beholden to investors and shareholders, and if they demand a return on their investment or the C-suite wants a raise, the workforce will be one of the places the value is extracted from.