Iron wage law

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Ferdinand Lassalle.

The iron law of wages (Engl. Iron law of wages ) is a labor theory of Ferdinand Lassalle from the 19th century that states that the average wage in the medium always to subsistence levels off. If wages rise above the subsistence level, the labor supply increases due to the increase in the working population, so that wages fall again. On the other hand, if the wage falls below the subsistence level, a reduction in the supply of work leads to an increase in wages. This theory goes back to the research of theorists of classical liberalism , in particular David Ricardo (see his theory of wages ).

Lassalle concluded from the iron wage law that a lasting improvement in the situation of the workers was not possible through the labor struggle of the trade unions, but only through the achievement of a parliamentary majority for the workers' parties. He therefore fought against the three- tier suffrage and for universal and direct suffrage.

Ferdinand Lassalle

Ferdinand Lassalle was a pioneer of German social democracy and the first president of the General German Workers 'Association (ADAV), a predecessor organization of the SAP (Socialist Workers' Party) and the later SPD ( Social Democratic Party of Germany ).

The most detailed version of his wages law can be found in the open reply letter :

“The iron economic law which, under today's conditions, under the rule of supply and demand for work, determines wages, is this: that the average wage always remains reduced to the necessary livelihood, which in a people is habitually used to extend existence and is necessary for reproduction. "

- Lassalle, open reply , in: LGRS, Vol. 3. 58f (quoted from Grebing et al.)

Based on Malthus' population theory, the rate of increase in the working population is determined by the level of wages. If this wage is above the subsistence level, the labor supply increases due to the increase in the working population, so that the wage falls; if wages fall below the subsistence level, a decrease in the supply of labor leads to its rise again. This is based on the assumption that labor demand is a monotonically decreasing function of wages.

meaning

Unions

According to this idea, wages should be determined by law, i. H. for a certain work performance according to the "iron wage law" the equivalent value in money can be legally set. The idea is similar to the minimum wage , but does not define the minimum entitlement, but a fixed “iron monetary value” that must neither be exceeded nor undercut. The iron wage law is therefore the conceptual opposite of the applied collective bargaining autonomy , which takes place between the union as employee representative and the employers without any formal outside influence.

Even Ricardo did not assign a role to the trade unions in his theory. Because of the iron law of wages, he found their efforts useless.

The iron wage law had a decisive influence on trade unions and social democracy v. a. because of the consequences for the policy of the labor movement derived from it . A lasting change in social conditions was not expected through industrial action in the production area, but through the achievement of a parliamentary majority by the working class (struggle for general and direct suffrage).

Today's view

The context described by Lassalle, elevated by the classics as well as by Marxists to the rank of a law of nature, did not apply to the northern states of the USA even in Marx's time . With industrialization (initially in western countries) the living standards of workers rose continuously on average. After abandoning the Malthusian population trap on which Lassalle's law was based, the meaning of his wages law was also lost. Despite rising wages, the population grew more slowly or in some countries almost came to a standstill (see also demographic transition ).

If there are nowadays full-time employees who work for wages that are just above or below the poverty line , we speak of low wages . The early capitalist production conditions, which were common in the industrialized countries until the second half of the 19th century and which still occur in the world today, are also known as wage slavery . If people are not spared from poverty in spite of employment, one speaks of in- work poverty (also working poor ).

criticism

Karl Marx denied that changes in wages had an immediate influence on the growth rate, referring to the time children grew up, which passed before they entered the production process.

literature

Web links

supporting documents

  1. ↑ Iron Wages Act - Article in the Gabler Wirtschaftslexikon
  2. ^ Grebing et al .: History of Social Ideas in Germany . VS Verlag für Sozialwissenschaften; Edition: 2nd edition 2005 (August 26, 2005). ISBN 978-3531147529 . P. 138.
  3. ↑ Walther M \ Xfcller-Jentsch: Work and Citizen Status : Studies on Social and Industrial Democracy . VS Verlag für Sozialwissenschaften; Edition: 2009 (January 5, 2012). ISBN 978-3531160511 . P. 144.
  4. ↑ a b Ehenes Wage Act - Article in the Gabler Wirtschaftslexikon
  5. ↑ Wolfram Engels: A constructive criticism of the welfare state . Mohr Siebeck (1979). ISBN 978-3163418615 . P. 11.