Quote Originally Posted by Dayuhan View Post
Americans all love to hate "the corporations" [insert warding-off-evil symbol here], but might do well to reflect on where those "high paying jobs" everyone talks about actually come from. Ghastly as the corporations are, we'd be well stuffed without them.
Not necessarily.

The biggest advantage of a corporation over a SMEs is power, and more rarely economies of scale.

Power translates into better safety against legal claims, ability to bully and push out smaller competition (even small patent applicants) with legal claims, get better purchase deals (and at times even get a discount with threat of legal action).


Now think about it; such a power asymmetry exploitation enterprise pays a higher salary than a SME in the same market.
This is often in part compensation for a worse work environment, and thus not always an employee's advantage tot he full extent.

The corporation may also pay a higher salary because I exploited power asymmetry to gain a high market share in a generally very profitable market. Meanwhile, the SME can pay less in the same market because its lesser power leads to additional costs.


I see no real reason why corporations should pay systematically better salaries/wages because they're somehow better organisations. In fact, up to 100% of the salary difference may be compensation for the job being ####tier and the ability to pay a high salary might be transferred to all SMEs in the same market if you get rid of the corporation(s).

Did salaries drop when AT&T got dismembered, did they rise when it reassembled itself?



The German economy rests on SMEs, many of them were founded during the rebuilding of the economy in the 50's. Our big corporations are mostly consumer brand enterprises. The B2B sector is mostly about SME suppliers.
We seem to do fine. One nice trait of SMEs is that their direct investments in foreign countries are mostly marketing investments, not about exporting jobs.