New Fed Reserve Chairwoman : No such thing as Cheaper, Better, Faster e....

[TopSage]

JanetYellen, selected to replace Ben Bernanke was involved in break through economic
research with her Nobel prize winning husband. One of her major findings:

Her initial research was in international development but she made her mark studying labour markets. The theory of the “efficiency wage,” developed with her husband and future Nobel laureate George Akerlof, posited that workers who felt poorly paid were less productive. Knowing this, employers would pay them more than the market-clearing wage, which would raise unemployment. Ms Yellen and Mr Akerlof also demonstrated how firms and individuals might rationally decline to adjust wages or prices in response to a monetary shock. That collective behavior would produce recessions. By setting Keynesian macroeconomic theory upon microeconomic foundations, this work helped build the “New Keynesian” paradigm which is how most central banks still view the world.

Poorly paid workers become unproductive. Wage suppression techniques of the pap including import of cheap foreign labor and reduction of benefits led to a long term decline in productivity. Lim swee say's cheaper, better and faster approach is fundamentally flawed ...basically when it comes to labor policies the pap has not
based them join properly researched sound ideas.