Market Forces and Improving Labour Conditions

How much can we improve labour conditions? In an earlier post I noted this is a very complicated issue and leads to several more specific questions including this: “if a firm responds to higher labor costs by switching to labor-saving technology (…), are former workers better or worse off?”

I agree that some basic and cheap precautions could easily save the 300 miners in Soma and such precautions are necessary. However, beyond those, I am worried about the negative consequences of mining regulations for the miners’ economic well-being. It seems to me that the fundamental tragedy of Turkish miners is that they are unskilled workers who produce little surplus and can be replaced easily. If that is true, then more regulation that raises the labor costs of Turkish miners could result in their unemployment, which will have dire consequences for their families.

Take for instance, this article from Radikal on a new mine that will open in Turkey and its safety precautions. Note that the mine will be fully mechanized, which means that large machines will dig out the coal instead of shovel-carrying humans. Hopefully we will not hear of any workers dying in this mine, but there will also be many fewer people employed there. If similar technology comes to the mines in Soma and replaces the risky jobs with machines, what is the net benefit for the workforce there? Are they better off because some of them work in better conditions now, or are they worse off because many of them no longer have jobs? There is a trade-off here that we should not overlook.

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