Comment On Marginal Benefit As Related To Unemployment
September 3, 2009 0 Comments
Certainly,
the linear increase of workers within an organization does not
always result in a linear increase of the output. The fundamental
reason behind this phenomenon is that businesses and organizations
are not just collections of individual workers where the work of
each one is added to the final output, but instead, they are
systems that behave as a whole towards a common target. These
systems act as a single organizational unit and its members execute
different roles in order to achieve the common target. The fact
that I want to emphasize is that this situation is true when you
examine it within an organizational unit and not from outside. For
example, if you put 100 doctors within a operating theater you will
not achieve to finish the surgery earlier. Here you examine the
situation withing the organizational unit of the operating theater.
But, if you have 100 doctors within a hospital and you perform ten
surgeries at a time, then here is where you will see the output
increasing. Moving to the next level, hiring 1000 doctors for a
hospital with 10 operating theaters will again not achieve an
output increase. This is where marginal analysis can play a vital
role, which is to determine the marginal benefit, thus the optimal
number of workers within an organizational unit whether this a
team, a small business or a large corporation. Marginal analysis
must be based on this organizational unit concept. But, commenting
various thoughts that have been heard recently, I cannot accept the
argument that minimizing the unemployment will hurt the economy's
productivity. A national economy is not a single organizational
unit with a single way of wok and a single output, so it cannot be
analyzed with techniques that are used for much less complex
systems like business departments and factory units. Most of the
times simplifying complex situations is the source of the biggest
problems.
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