Politics of Commodity Pricing and Labour Pricing

Abstract

The concept of social exclusion is derived from the theory of economic exclusion, which centres around an individual's income or purchasing power, which in turn is connected to the price of goods and services. Price is an economic or quantitative representation of a qualitative concept known as desire, which is further translated into demand based on an individual's ability and willingness to purchase. Price indicates the aggregate cost associated with producing goods and services, which includes various factors apart from labour. However, labour is the sole factor that has very limited bargaining power on its wages. As suggested in theory, the rate of increase in prices and wages doesn’t always equilibrate, which is where the capitalist maximise their profit by squeezing the wages. However, this gap between wages and prices often leads to business cycles and generates a crisis in the capitalist economy. Labor differs from other factors of production in two respects. First, it not only contributes to production but also is the primary consumer. Second, labour is the human capital that drives economic growth and prosperity. Unfortunately, capitalists tend to overlook this crucial role of labour as human capital. Human capital which is the basis of formation becomes the basis of capital accumulation..

For a strong healthy and efficient human resource, nutrition has to be the first priority for every welfare scheme and public policy. Rising prices of food and fuel becomes a hindrance with fall in real wage.

This paper will explore the empirical relationship between price fluctuations and growing wage disparities.  This paper also attempts to analyse how price of product and price of labour are intertwined and affect the macroeconomics trends.