Productivity is further affected by any special costs that may accompany the employment of certain workers. Suppose, for example, that class-C workers can accomplish a desired task only if they are provided wheelchair ramps or other special facilities. Regardless of the sympathy that we may feel for class-C workers, objective praxeological analysis requires that we recognize that these additional factors of production impose real costs, which must be subtracted in realistic calculations of productivity. Of course, some individuals (perhaps even the employer) may feel especially compassionate toward class-C persons and may therefore defray the costs of such facilities, thereby deriving psychic utility, considered independently of monetary calculations; in that case, of course, those costs are not included in productivity as measured by the free market.

Let us suppose that the net effect of these various considerations is that in a given market the average hourly productivity rates of class-C workers (and hence their average free-market wages) lag behind those of the other workers. Suppose further that regulators, guided by the simplistic notion of "equal pay for equal work" rather than the free-market's more sophisticated principle of "equal pay for equal productivity," legally require the firms in that market to pay class-C workers the same wage rates as their co-workers. This requirement, if implemented by itself, effectively imposes an above-market minimum-wage control for class-C workers. In order to maximize their profit, therefore, employers must dismiss (or cease to hire) those class-C workers whose productivity rates fall below the legal requirement, thereby leading to unemployment among these workers (pp. 4.11:28-35).      Next page


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