Friday, May 29, 2015

Startups and the productivity puzzle

Startups and the productivity puzzle:assesses the effect of cheap labour and bizarre consumer choice on UK productivity.

 "In other words, it’s easier to make money by using cheap labour than by investing in machinery. Furthermore, in this example, people would be mad to invest in new machinery because they would be unlikely to make enough to cover their investment. The media love to talk about high-tech entrepreneurship. There may be a few such firms but most of Britain’s startups are low tech or no tech.

Has this county become an El Dorado for cheap labour? Does the business opportunity now lie in setting up a business to exploit what the Economist described as Britain’s pitiful pay and its even more impoverished freelancers? That might explain why, far from improving the country’s productivity, Britain’s startups are making it worse."


'via Blog this'

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