Why Capital Hires Labour and Why Labour Does Not Hire Capital
Homo Oeconomicus Vol. 18(3/4), p. 429-436, 2002
8 Pages Posted: 6 Oct 2016
Date Written: October 4, 2002
It is shown that in an economy with non-marginal set-up costs on the capital side, which imply a minimum requirement of capital, production may be carried out by capitalist firms only, irrespective of the fact that workers can exchange work for capital so that labour-managed production seems feasible.
Keywords: Labour-Managed Production, Starvation, Set-Up Costs
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