I think this does not necessarily contradict the Prisoner’s Dilemma scenario.
As a thought experiment, to make things simple, imagine that everyone wants the same hourly wage for each of the first 8 hours, but 100% more for the ninth hour, and 200% more for the tenth hour.
So we start with a 8-hour workday for everyone; everyone making 8x per day. (As a thought experiment.)
Now suppose that the 8-hour workday is abolished, and everyone decides to take the extra two hours to make 13x instead (8×1 + 2 + 3), because it seems like a good idea.
But now the total amount of available hours has increased by 25%, which (according to Econ 101) means that work becomes somewhat cheaper, per unit. Instead of the expected 13x the employees will get 13y instead, for some y smaller than x.
If you decide, as an individual, that 13y is not worth ten hours of your time every day, and try to get your original 8-hour workday back, guess what, now you can only get 8y instead of the original 8x. Oops. Now, depending on the exact values of x and y, maybe 8y is still enough to feed your family and pay the mortgage. Or maybe it is not… and then you can only curse the fate and keep working 10 hours a day, because the old choice no longer exists. But now the fact that you keep working 10 hours a day is also preventing other people, as individuals, to get their 8-hour workdays back for 8x.
Note that the exact values of x and y depend on the structure of the market (how flexible is the demand for work). It is not even guaranteed that 13y is necessarily more than 8x.
Companies that tried to raise hours without raising per-hour pay would lose workers to companies that kept the old schedule
The missing part is that the companies that kept the old schedule can now afford to pay less, because now more people want to work for them.
I don’t think this works. You’re going from a thought experiment with exact numbers that would agree with me, then throwing them away to use a heuristic and saying that somehow pay would go down.
Your thought experiment doesn’t really match the current situation, since >8 hour days aren’t actually banned, they just cost 50% more, but assuming there was an actual ban...
Specifically, the problem is that when the 8 hour work day is abolished, the supply of hours that cost $x stays exactly the same, while the supply of hours that cost $2x and $3x increases. The additional supply of more expensive hours doesn’t help the employers’ negotiating position at all. Or to be specific, the fact that Walmart now has a much larger supply of people willing to work for $24 per hour doesn’t help them hire people for $12.
One way this could effect things is to increase income inequality, if some people are 4x as productive, it would be better to hire them for as many hours as you can get than to hire additional lower-productivity people, but it’s weird to talk about this in terms of businesses exploiting people since total pay would actually go up.
I think this does not necessarily contradict the Prisoner’s Dilemma scenario.
As a thought experiment, to make things simple, imagine that everyone wants the same hourly wage for each of the first 8 hours, but 100% more for the ninth hour, and 200% more for the tenth hour.
So we start with a 8-hour workday for everyone; everyone making 8x per day. (As a thought experiment.)
Now suppose that the 8-hour workday is abolished, and everyone decides to take the extra two hours to make 13x instead (8×1 + 2 + 3), because it seems like a good idea.
But now the total amount of available hours has increased by 25%, which (according to Econ 101) means that work becomes somewhat cheaper, per unit. Instead of the expected 13x the employees will get 13y instead, for some y smaller than x.
If you decide, as an individual, that 13y is not worth ten hours of your time every day, and try to get your original 8-hour workday back, guess what, now you can only get 8y instead of the original 8x. Oops. Now, depending on the exact values of x and y, maybe 8y is still enough to feed your family and pay the mortgage. Or maybe it is not… and then you can only curse the fate and keep working 10 hours a day, because the old choice no longer exists. But now the fact that you keep working 10 hours a day is also preventing other people, as individuals, to get their 8-hour workdays back for 8x.
Note that the exact values of x and y depend on the structure of the market (how flexible is the demand for work). It is not even guaranteed that 13y is necessarily more than 8x.
The missing part is that the companies that kept the old schedule can now afford to pay less, because now more people want to work for them.
I don’t think this works. You’re going from a thought experiment with exact numbers that would agree with me, then throwing them away to use a heuristic and saying that somehow pay would go down.
Your thought experiment doesn’t really match the current situation, since >8 hour days aren’t actually banned, they just cost 50% more, but assuming there was an actual ban...
Specifically, the problem is that when the 8 hour work day is abolished, the supply of hours that cost $x stays exactly the same, while the supply of hours that cost $2x and $3x increases. The additional supply of more expensive hours doesn’t help the employers’ negotiating position at all. Or to be specific, the fact that Walmart now has a much larger supply of people willing to work for $24 per hour doesn’t help them hire people for $12.
One way this could effect things is to increase income inequality, if some people are 4x as productive, it would be better to hire them for as many hours as you can get than to hire additional lower-productivity people, but it’s weird to talk about this in terms of businesses exploiting people since total pay would actually go up.