Automation Quote by Philip Kotler
“Requiring the payment of higher wages will lead to a loss of some jobs and a raising of prices which drives companies to search for automation to reduce costs. On the other hand, those receiving higher wages will spend more (the marginal propensity to consume is close to 1 for low income earners) and this will increase demand for additional goods and services. Henry Ford had the clearest vision of why companies can actually benefit by paying higher wages.”
About This Quote
Source Book: Marketing Management, 2016
Higher wages can boost demand and automation, but also raise costs; balancing wages and productivity is key.
In simple terms: Paying more can increase demand and automation.
Key Takeaway
Balance fair wages with efficiency.
Themes
marketing
economics
labor
Mood
analytical
strategic
Type
business
economic
When to use this quote
- pricing strategy
- product development
- employee retention
- cost analysis
- market research
Key Concepts
microeconomics
consumer behavior
automation
Questions to Reflect On
- How can firms maintain profitability while raising wages?
- What role does automation play in wage decisions?
A Different Perspective
Higher wages may reduce profit margins if not offset.
