> and you accepted $X because you couldn't find someone to give you $X+1.
My buddy accepted $X -($X *.8) = $Y because the company offering $Y was doing something ethical. Point being there's far more variables at stake here to over simplify.
My buddy accepted $X -($X *.8) = $Y because the company offering $Y was doing something ethical. Point being there's far more variables at stake here to over simplify.
A classic example is the lack of perfect information in the labor market like you see in a commodities market. A more specific example is the wage-fixing scandal that hit tech companies [1]. In this case, the companies used their market power and unified to lower worker wages and stop them from crossing the street for more pay.
[1] https://www.cnet.com/news/google-adobe-apple-intel-settle-wa...
Employers colluded to reduce number of buyers, hence reducing demand, causing sellers to have fewer alternatives to sell their services to, causing them to sell at a lower price than they otherwise would.
There may be more effects due to lack of information or ability to move or issues of social signaling compared to a simple example of widgets, but in the grand scheme of thing, it still follows the same principle.
That said I work for below market because I value the work and enjoy it. Not sure what kind of bump I’d get but it wouldn’t be a 5x