Showing posts with label Garbage. Show all posts
Showing posts with label Garbage. Show all posts

Saturday, June 12

How many garbagemen does it take to change a lightbulb?

Missoula, Montana is a bit of a weird place in terms of its economics.

The city seems to lack an understanding of the concept of "diminishing marginal product of labour." It's the idea that each additional worker a business takes on will be less productive than the last.

This makes sense. If I run a pizza shop, I'm not going to be able to do anything with zero workers. The benefit from my first worker is huge — I'll be able to produce pizzas. The benefit from my second worker is still pretty big — now I can do delivery instead of just take-out — but it's not as exciting as adding my first worker. My third worker will allow me to take on more business, but as I start adding a fourth and fifth worker, they'll probably contribute a little less since they'll mostly be standing around except when the shop is really busy. By the time I start adding a sixth and seventh worker, my pizza parlor is probably getting crowded and they might even slow things down.