The Origins and Decline of the Wage System | Hacker News Reader

The Origins and Decline of the Wage System

inteldaily.com

23 pointsdaniel-cussen13 comments

The essay is well written and has historic base. Nevertheless I did not like the pessimist conclusion.

1) I believe that a economy with an increasing number of startups in the long run is going to grow. 2) The people that try but fail, is going to have entrepreneurial experience that is going to be attractive to the successful startups and companies in recuperation.

Interesting but opinionated and dated. "Wage slavery" became an acceptable and necessary trade-off after the move from an industrial to service economy. This was possible in the US due to the rise in immigrant population (population boom of cities) and the automation of agriculture.

Interesting and opinionated - good summary.

But there are plenty of owner-operators in the service industry. One person can run a small cafe single-handed. 2 founders (a head cook, and a head waiter) can run a mid-sized restaurant. They still need a few kitchen hands and waiters, but they don't need to hire any managers.

Once the whole management structure can be manned by founders the wage system has been undermined.

The point isn't that everyone will be an owner-operator or contractor. The point is that all the good jobs will be. If you want to scrub floors, that's OK, but everyone else will be a manager or a hired gun.

To take your example, a restaurant, the most important factor in success is how well the kitchen works. That requires a solid head chef. How well will that chef run a business when he or she's also running a kitchen? That requires them to specialize in two domains, rather than one.

There's a reason why corporations are more efficient than coalitions of self-employed singletons operating in a free market. The transaction costs kill you. In order to specialize with sufficient depth to compete in pretty much any non-local market, you necessarily must either work for someone else, or hire many other people to work for you - and thereby make your specialism planning, coordination and managing, rather than anything else.

That may well have been true for a while but I think the information revolution will eventually make it so easy to organise, collaborate and outsource that the managerial overhead of a corporation will put big companies at a disadvantage.

the division of labor should have a natural schelling point WRT balance between organizational complexity and increased efficiency from specialization. this point moves as humans get better at logistics (computers continue to create an explosion in this area).

In wired:

http://www.wired.com/culture/culturereviews/magazine/17-06/n...

Chris Anderson wrote broadly about the topic.

here is some actual scholarship on the subject rather than opinionated garbage in the original link.

http://szabo.best.vwh.net/synch.html

pg also wrote about it if memory serves.

In the UK there is a chain of stores called John Lewis.

"John Lewis is a co-operative; all employees have a stake in the profits and all workers are called "partners". The staff turnover is well below the national average and assistants get to know their beat and their customers well."

http://www.telegraph.co.uk/culture/3657242/Spare-John-Lewis-...

It's amazing how well you're treated any of the staff at all of their stores. From the cleaners to shoe-fitters, they all seem to work that little bit harder to make the experience of buying in John Lewis as enjoyable as possible.

It's an interesting case study of a hybrid between ownership and employment.

If we each owned our own business, we would rarely reach the economies of scale that have increased standards of living for the last 200 years.

these economies of scale are often based on lower transaction costs at scale. information technology already has managed to lower or eliminate many transaction costs - and while doing so made a lot of previously unviable small business, viable.

it's hard to say how many of these transaction costs are to stay with us over the next decades, but it's quite safe to say a lot of them will go. i have no answers, but i'm really curious how this will change society.

hiring is obsolete http://www.paulgraham.com/hiring.html

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