Before saying anything, it would be good if you could watch the next video by clicking here. After watching the video, a certain idea kept going around in my head, especially the part where Kevin O'Leary addresses Johnny Georges. It's amazing how for that man, who has no money, because he's there trying to get a deal, but even though he's probably the richest man in that room, a dollar of profit per unit sold is enough, and yet, for a subject like O'Leary, with an excessive amount of money and passive income, needs a profit 7 or 8 times higher, because now "there are two mouths to feed".
However, my goal here is not to make a moral criticism, which could be perfectly valid, no, I will not talk about that, but about the economic repercussions, and therefore social, that the disposition to work has a nation.
If Johnny Georges was made the deal with Kevin O'Leary, agreeing to raise the price to the levels established by the finance shark, and mainly because there is a regulation of the State that grants the patent, a monopoly, of production on the invention, the farmers would have had to pay more to buy the product, which would reduce the capacity to acquire units to certain farmers who don't have so much capital, decreasing the total harvest, and consequently the supply in the market, not to mention that water and land are wasted. On the other hand, those farmers with enough capital to buy the product in the total amount that they need, even at the high price, must raise the price of the product because the costs have increased. And don't get me wrong, in any case the society benefits because the product allows a better yield of water and increase farmers' crops, so it would be an improvement compared to the initial situation, nevertheless, it could be said that the increase hypothetically introduced by O'Leary was reduced social benefit, fortunately, it was not so and society, as a whole, will not have to invest more resources, time and energy to obtain the same.
All this problem starts from the moment in which the State grants a patent, because otherwise, in a free market the competition would be in charge of eliminating the arbitrariness of the usurious profit that O'Leary intended to obtain on the product.
The event in question has nothing new, but there is something that caught my attention, and it is the arbitrary that can be what an individual considers a stimulating compensation. For O'Leary, the business only made sense if he could earn 7 or 8 times more than Johnny considered necessary, fair or motivating.
This means that the same amount of money or the same reward is not equally valid for everyone. For some, the minimum wage, nested to their specific personal conditions, can be a stimulant enough to wake up every day to go work in a detestable job, for others not a million dollars would be enough, and likewise, there is also who are willing to do a job without receiving any type of remuneration.
From this we can assume, then, that one of the fundamental factors that affect the cost structure of a nation is the willingness of its inhabitants to work, and the incentives that exist to do so.
A nation composed of lazy people will tend to have higher costs than a nation made up of people with a culture focused on work, because it is necessary to give greater incentives to perform the same activity, of course assuming they are equally productive at the time to perform the task. On the other hand, a nation composed of people with a culture highly focused on work will tend to demand less remuneration, and consequently the cost structure will be lower. It should be understood that this not only affects the employee, it is not about exploitation, I am including the profit margins that the owners of the companies are willing to charge also.
But even then things are much more complex, nations are not composed of only one type of people but by many, there are individuals with different degrees of willingness to work, and the incentives are not equal for all, so measuring this factor becomes an impossible task.
It is interesting to look at the main existing incentives, one of them, the most frequent, is the "lifestyle", each of us has a lifestyle, and maintaining it probably requires that we work. Another incentive can be the children, having a small child to care for, and with needs, makes us more likely to work. An ambitious person, or someone with a sick relative, the reasons are many.
This is one of the many causes why the communism raised by Marx would never work, because the individual is conceived without the family and without material needs, even without moral, but it is also intended that the individual cooperate with social work. Is that coherent?
In conclusion, taking into account what has been mentioned so far, we can assume that those nations that have a better relationship between willingness to work and incentives to do so, will tend to have a lower cost structure, and as a result, society will be able to create more material wealth.
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