Saturday, August 25, 2012
If the wages are too low, employees will quit and move to higher paying jobs.
This cartoon ignores that markets are competitive and prices for the product gravitate towards their marginal cost.
Even in monopolized markets the labor is perfectly competitive so there's many substitutes for the labor. If machines are substituted for labor, then wages can go lower. This would happen in an unskilled labor market but not in the skilled labor market.
This cartoon shows the rich in a negative light. Many entrepreneurs earned their income by working long hours and taking risk. Often the entrepreneurs work with a high opportunity cost.