3 months ago
The lower the wage, the less incentive to use labor effectively. In a capitalist economy, labor is cheap, and as such the capitalist can easily afford to waste that labor, and this leads to inefficiency and less technical advancement. In fact it can and many times does pay the capitalist to waste labor, why would the capitalist pay for technology that can reduce the labor time when labor is so cheap that he can not only afford the extra labor time, but he can make more money than he would with technology that can reduce that labor time. It pays to waste labor.
This is often cited as the reason ancient societies like greece and rome failed to industrialize, dispite their great mindes and engineering skills. it was because of slavery, the master had no reason to account his slaves hours of labor, and as such they had no reason to economise on labor time. The romans knew of the water wheel but never moved on to widespread application of mechanical power.
Capitalism obviously has a clear advance on slavery, but it is still often seen under capitalism, a good example being in the computer industry, when IBM developed highly automated industry, demand grew and so did automaton, but they still could not match up with demand "The situation was becoming desperate. Then a newly appointed manager
at Kingston who had spent several years in Japan, proposed that workers
in the Orient could be found with sufficient manual dexterity and patience
to wire core planes by hand. Taking bags of cores, rolls of wire, and core
frames to Japan, he returned ten days later with hand wired core planes
as good as those that had been wired by automatic wire feeders at the
Kingston plant. It was slow and tedious work but the cost of labor in the
Orient was so low that production costs were actually lower than with full
automation in Kingston." (Pugh et al., 1991, p. 209)