Iron law of wages

The iron law of wages (English iron law of wages ) is an economic wage theory of Ferdinand Lassalle in the 19th century.

The Lassalle since 1863 passionately proclaimed slogan says roughly that under perfect competition and under conditions of unrestrained capitalism the wage long term always fluctuates around the subsistence level. This perspective is related to a number of other wage theories that predict all wages at subsistence level. Lassalle 's theory was, inter alia, through the work of the English economist David Ricardo affected (see the theory of wages ). But there are also many similarities to the Malthusian theory of wages.

The various theories of classical political economy differ from each other in the determination or definition of subsistence. A wage must be at least this serve to ensure a standard of living can meet the basic physiological needs ( biological min ). This perspective assumed Lassalle. Other classics see the subsistence rather than a historically and socially variable subsistence that determined from the respective social conditions out.

Ferdinand Lassalle

Ferdinand Lassalle was a pioneer of German Social Democracy and the first President of the General German Workers' Association ( ADAV ), a predecessor organization of the SAP (Socialist Workers Party ) and the subsequent SPD (Social Democratic Party of Germany ).

The most detailed version of his wage law can be found in the Open Letter:

" The brazen economic law, which under present conditions, under the rule of supply and demand for labor, wages determined is this: that the average wage is always reduced to the necessary livelihood, in a people habitually to the prolongation of the existence is required and to reproduce. "

Based on the population theory of Malthus, the proliferation rate of the working population is mibestimmt by the wage level. If this wage is above the subsistence level increases by increasing the working population, labor supply, so that the wage decreases; decreases wages below the subsistence level, a reduction in labor supply leads to his resurgence. This is based on the assumption that the demand for labor is a monotonically decreasing function of the wage level.

Importance

Unions

According to this idea, the wages should be fixed by law, that is, for a specific job performance according to the " iron law of wages " the equivalent in money to be prescribed by law. The idea is similar to the minimum wage, but does not define the minimum requirement, but a fixed "iron " money value which must be exceeded neither over-nor. The iron law of wages is therefore the conceptual opposite of the applied collective bargaining that takes place between the union representing the employees and the employers without formal action from outside.

Even Ricardo pointed out in his theory of the trade unions no role to play. Due to the iron law of wages he held her efforts useless.

The iron law of wages had a decisive influence on trade unions and social democracy esp. because of the derived from it implications for policy of the workers' movement. A sustainable change in social relations was not expected by industrial action in the production area, but by gaining the parliamentary majority of the working class ( struggle for the general and direct suffrage ).

Today's view

The relationship described by Lassalle, lifted from the classics and from Marxists to the rank of a natural law, was already in Marx's time not for the northern states. With industrialization ( first in western countries ) the living standards of workers increased (on average) continuously. After the Malthusian population trap on the Lassalle 's law is based, was abandoned, and the importance of his wage law was lost. Despite enhancing wages, the population grew more slowly and the population growth came to a virtual standstill in some countries (see also Demographic transition).

Find nowadays full-time employees who work for a wage, which is located just above or below the poverty line, it is called low-wage. The early capitalist relations of production were up in the second half of the 19th century, common in industrialized countries and is still occurring in the world are also referred to as wage slavery. When persons not spared work poverty, it is called working poor (even the working poor ).

Criticism

Karl Marx said no immediate impact of changes in the wage level on the multiplication rate with reference to the time of the nursery children who pass away until their entry into the production process.