Comment by mantas
21 hours ago
Still less work hands would mean change of balance between the capital and the labour. The changes in real estate pricing, which is one of the main expenses for labour, would be massive.
21 hours ago
Still less work hands would mean change of balance between the capital and the labour. The changes in real estate pricing, which is one of the main expenses for labour, would be massive.
It doesn't really mean that because there isn't a forever fixed amount of labor being bidded on by the workforce. That side of the market is also dynamic. As population ages and then shrinks, labor demand will also shrink. If supply and demand shrink in tandem, wages don't increase.
Real estate bubble would pop for simple reason that were would be significantly less people overall.
And much lower real estate prices could amortize a lot of wages shrinking, from labour perspective.
Real estate bubble won't pop with a shrinking population, because shrinking populations retreat to city centers. Spain, Italy, Japan, and Korea are full of $10,000 houses and all of them are overpriced. Meanwhile, Madrid, Rome, Tokyo, and Seoul are, without hyperbole, more expensive than they've ever been.