This seems really super straight forward. Demand increases, price increases. Why would you sell your labor for less than the max you can get? If another company offers you twice your salay, are you declining?
This isn’t even a capitalist thing. Markets and supply and demand have existed long before capitalism, or socialism.
It’s the same reason rents are high in cities. If 100 houses need to be distributed to 1000 families, you need a mechanism to “get rid” of 900. Increasing the price for the rare commodity is one of the options, a lottery like in the DDR is another.
This seems really super straight forward. Demand increases, price increases. Why would you sell your labor for less than the max you can get? If another company offers you twice your salay, are you declining?
This isn’t even a capitalist thing. Markets and supply and demand have existed long before capitalism, or socialism.
It’s the same reason rents are high in cities. If 100 houses need to be distributed to 1000 families, you need a mechanism to “get rid” of 900. Increasing the price for the rare commodity is one of the options, a lottery like in the DDR is another.