SANTO DOMINGO.- National Business Council (Conep) president Lisandro Macarrulla said if the salaries in terms of dollars is compared with those in the Central America countries that have a Free Trade Agreement, ours may be higher, but among the lowest in terms of spending power, for which the employees’ spending power needs a boost, more than a wage increase.
He said the worker’s spending power must improve and a wage increase is one way to do so, but "it needs to be studied within the economic reality of the country and the world."
Macarrulla said a 40 percent wage increase in the current economic conditions is neither justified nor possible. " It’s necessary to study which elements are involved in Dominican Republic’s cost structure. When the wage is nominally increasing without controlling costs and products and inflation voids that increase you’re not getting anything, because the spending people’s power doesn’t improve and in the end that’s what matters, not the amount of pesos that you earn, but the goods and services that you can buy with that money."
On Friday the unions grouped in CASC said they won’t accept anything less than a 30 percent wage increase for workers who earn up to RD$30,000 per month.
Written by: juanb, 28 Nov 2008 2:55 PM
From: Dominican Republic
30% Minimum? Why not 75% minimum wage increase?
From: Dominican Republic
Why don't the merchants in control of commodities reduce their profit margins by 75% ? So it takes them 4 years to become mega millionaires instead of one. A move like that by these few would benefit soooo many!
Written by: OndeVert 
, 28 Nov 2008 3:13 PM
From: United States
Raising salaries => loss of profits + unemployment! It is better for government to invest in a way to lower prices of basic commodities! Oil prices are down which is a tax cut to consumers! We need to be patient! We need to develop an internal market since the U.S. is contracting! Maybe the hole wiped Generoso can come up with a better formula!
From: United States, Reality Check
Clearly, there is a huge disconnect where there is "Price Gouging" by merchants. We even saw this in the US with gas stations where despite oil being $147 there was alot of collusion among gas stations to keep prices high and matching the increases of others. In essence, not everything in the $5 per gallon was due to oil.
In the RD, they should benefit from lower commodity prices (i.e. oil, food etc.) and there should be a bigger windfall felt from the DR-CAFTA. Now, there should be more access to markets and incentives given for WalMart & Home Depot to enter the RD market. BUT DUE TO CORRUPTION, GREED OF MERCHANTS & LACK OF RD GOV EFFECTIVENESS.... the Dominican consumer does not see the lower prices trickle down during the brief tenure of DR-CAFTA. BUT IN FACT WHILE MERCHANTS SAVE & GAIN HIGHER MARGINS (from lower cost of goods) they raise prices to Dominican consumers while the world is n de-flation.
The RD Gov allows this corruption to exists! No ones accountable!
Written by: jacirez , 28 Nov 2008 8:46 PM
From: Iran, Zähedän
Alas, my compatriots do not seem to have learned the lessons taught by Sam Walton (of Wal-Mart fame) you make your money in volume; not mark-up...
Our mentality seems to be squeeze the customer as much as possible...the first time they walk into the store...IDIOTS!!!
Written by: OndeVert , 28 Nov 2008 9:45 PM
From: United States
Recalled that prices went up when oil went up due to HIGHER COSTS! Now that oil prices went down, prices remain high because demand is down (due to lower incomes from remittances, tourism, lost of foreign investments especially the europeans, etc.). So let's get use to higher prices for a while!
From: Dominican Republic, Boycott Dominican Tourism
no one has money to be anything....
From: United States
OndeVert offers that "prices remain high, because demand is down". please indulge me and explain that theory to me, if you will.
From: United States
raising salaries does not NECESSARILY increase the costs of goods and services. salaries are not the only input in the production process. an increase in salary can be offset by other efficiencies. i realise that unemployment is a major concern, but my experience is that many dominican businesses are overstaffed, with redundant personnel. if the productive process is mechanised and rationalised, salaries can increase without causing an inflationary cycle, but not if all else remains constant.
From: United States
and Jacirez, Sam Walton makes profits by lowering costs. holding inventory is an additional fixed cost in the retail chain. walmart uses a strategy called "just in time inventory", wherein the stores hold just enough product for daily demand. they figure out how many size 7 shoes, of a particular style, are sold daily. the store holds only that amount. they do not operate like a regular business, which holds several unsold products for weeks and months, tying up working capital in unsold product, which adds to fixed costs.
From: United States, Washington
Building an internal market has NEVER been a priority in Latin America. Since the conquest, our economy and society have been aimed outward, to satisfied the needs and wants of core countries. THIS IS STILL THE CASE - focus on FTZs & Tourism. As many "dependentistas" have argued, we need to focus on developing an INTERNAL MARKET that is able to produce and consume key high-value-added products. This is not a call for ISI, but rather a NUANCED approach to industrialization that protects some key sectors, makes regional integration, tries to maintain some of the profits in-house for a certain amount of time - Capital control. The key thing is to try to retain a high-value-added processes so that we can reap the benefits of the production processes.
Of course, with this we need a comprehensive social program and progressive DIRECT taxation. This, I argue, will help increase the purchasing power of ALL dominicans.
For those of you in the US - happy goggle goggle day!
From: United States
baldoria, as usual, you are on the money. one of the most profitable ventures on earth, not only from financial, but practical standpoints, is aquaculture. we have fished out just about everything that we had in the coastal areas, and every so often, our fishermen are detained in other island waters. yet, compared to other islands like Cuba and Jamaica, the status of our aquaculture is a standing joke. we should have some outreach to countries with expertise in this area to assist and develop this side of the food issue. a portion could be locally exported; to the tourist industry. these are the pressing concerns of the day, the important priorities. not multimillion dollar sprucing up of the malecon. that can wait a few years until we have discretionary funds. i do not think it will disadvantage us too much if a few walls are in need of a coat of paint.
From: Dominican Republic
If you raise the wages the merchants will raise the prices. What dr needs is a government that works for its people. paren la bagabunderias.
pon me lo ahi.
Written by: anthonyC, 29 Nov 2008 8:15 PM
From: United States
I want to know what is a decent profit?
I mean whom among all you 'enlightened" types will decide how much a merchant should be allowed to make?
Who is so damn full of themselves that they have the cojones to tell me or anyone else how much they can make?
Then I want this jerkwad to try and tell me to my face how much money I am alowed to make.
From: United States
anthony, in the so-called "free market" which you love dearly, the merchant can only sell his product at the equilibrium price, where the supply curve and the demand curve intersect. how much profit he can make will therefore depend upon how efficiently and inexpensively he can get the product to market. two colmados can sell beer for 70 pesos, with one making 10 peso profit, the other taking a loss. it is dependent not only on selling price. in a monopoly situation, wherein a very few people control an item, and can fix prices, there is no free market, and capitalist governments have to establish price controls, if the goods in question are staple foods or necessities like cooking gas.
Written by: anthonyC, 30 Nov 2008 12:02 PM
From: United States
Again I ask.....
What is a decent profit? Who decides?
From: United States, Washington
What is a decent rate of return? depends on the opportunity cost. That's the type of rhetoric used by orthodox appraoches. But one should consider not just the financial profit/loss, but also the socio-political-cultural-environmental effects. Europe and the US, for example, feel there is a cul/pol value in their agricultural sectors- that's why they subsidize this sector. Similarly, Korea invested heavily in industries with many linkages to other sectors, to promote development. So it's not all about making a buck, it's about the wholistic value of a production process.
That's why we can't blindly follow these US-led free-marketeers. The US does whatever they think is best for itself, we should be aware of this and link forces w/ some of our neighbors so that we can't be pushed around into settling for scraps. But if one country dares to go against the empire (i.e. Cuba), it is vilified as "evil" and others are more than happy to step in. That's why regional intergration is neede
Written by: anthonyC, 30 Nov 2008 8:24 PM
From: United States
Blah Blah Blah.
Again I ask.
What is a fair profit and who decides?
From: United States, Washington
Blah blah blah... creative :-/
how about waaawaaaa, waaawaaa, waaawaaa...
Or what we think of you, "stupid comment, racist comments, reactionary comments"
Ha ha :-)
From: United States
anthonyc, if the question was not so nebulous, maybe we could attempt to address it. it is like asking "how high is up"? if you laid out some parameters, the issue could probably be ventilated. as it stands, it is meaningless and imponderable.
Written by: anthonyC, 1 Dec 2008 9:59 AM
From: United States
The point I am making is nobody has the right to tell me or anybody else how much profit I am allowed to make.
The Government wants to provide cheap food? Ok. Pay the farmers what they want then sell it at a discount to the mases.
Baldoria,
I defy you to show us even one comment I have made that is even remotely racist.
Until then please refrain from the insults when you cannot answer my points.
From: United States, Washington
I'll keep an eye out, so be on good behavior ;-)
Written by: anthonyC, 1 Dec 2008 10:31 AM
From: United States
"Written by: baldoria23, 1 Dec 2008 10:09 AM
From: Dominican Republic, Cabrera, M.T.S.
I'll keep an eye out, so be on good behavior ;-)"
I thought so.
A warning. I am not one to cower in fear of having the racist term thrown at me. I will defend myself.
From: United States, Washington
Well, I'm not saying that any of your comments are not racist/xenophobic, it's just I don't have the time to waste dealing with you. But next time you say anything racist/xenophobic, I'll point it out.
"A Warning..." what warning? I warn YOU that I'll point out any bigotted statement you make. So be aware of that.
Cheers mate,
Written by: abc200, 1 Dec 2008 1:30 PM
From: United Kingdom, Dominican Republic
Price control is vital in developing economies. For example the price of diamonds is controlled by DeBeers. aC is being his usual blank blank self,.
S.
Written by: abc200, 1 Dec 2008 2:12 PM
From: United Kingdom, Dominican Republic
Written by: Trujillo, 3 Dec 2008 2:35 AM
From: Dominican Republic
Wages AND buying power must increase.
Written by: anthonyC, 3 Dec 2008 9:37 AM
From: United States
Written by: Trujillo, 3 Dec 2008 2:35 AM
From: Dominican Republic
Wages AND buying power must increase.
How does increasing wages increase buying power? How do you increase wages without increasing inflation?
From: United States
you increase productivity, that is how.
Written by: anthonyC, 3 Dec 2008 9:56 AM
From: United States
Written by: dreadlocks, 3 Dec 2008 9:50 AM
From: United States
you increase productivity, that is how.
Oh...So simple.
Now go wave your magic wand and make it so.
From: United States
anthonyc, nobody says it WILL happen. you ask a theoretical question, i give you a theoretical answer. inflation is a simple concept; more money chasing the same amount, or less goods. nothing more, nothing less. simple example; if two guys produce 10 widgets, and their salary is x dollars, we have one set of givens. if we double their salary to 2x, and they produce 30 widgets, be it by mechanisation or better methods, then though there is more money, there is also a greater supply of goods. ergo, no inflation. it's that simple.
Written by: abc200, 3 Dec 2008 1:37 PM
From: United Kingdom, Dominican Republic
This is a stupid theory,. If people can't be persuaded to buy more widgets and no-one accepts widgets as a store of value there is over-supply and widgets become less valuable. Then they must work less hours for the same pay or one guy gets to be unemployed and must be given free widgets or whatever.
S.
Written by: anthonyC, 3 Dec 2008 1:51 PM
From: United States
Written by: dreadlocks, 3 Dec 2008 10:24 AM
anthonyc, nobody says it WILL happen. you ask a theoretical question, i give you a theoretical answer
Dready,
This is a Website dedicated to the D.R. Remember that. It wasn't a theoretical question that I posed. It was a question that was asked in relation to the D.R.
BTW Ignore abc. he knows even less about real world economics than your do.
From: United States
Regarding: anthonyC, 30 Nov 2008 12:02 PM
Again I ask.....
What is a decent profit? Who decides?
---
In a free market society (which doesn’t exist in DR) A price is usually decided by the market at the equilibrium point. The government responsibility is to insure that price fixing is not occurring or price manipulated by suppliers. What is decent fair amount of profit? well one has to consider a decent profit should be one that doesn’t overburden society ability to acquire that product or over burden individual purchasing power, and comparing same or comparable products with others produced in other nations while considering and comparing purchasing power and all factors of production and inflation. Just as you would do when investigating price dumping. When you compare two countries who have the same relative factors of production but country A is making 300 percent more profit then it is clear there unfair pricing strategies being utilized. Its called price fixing and gauging.
From: United States
If the price is lower in the imported market than expected at origin (considering ceteris paribus) then its price dumping.
From: United States
anthonyc, you asked "how do you increase wages without increasing inflation?" you did not specify in the DR, which would have been another of your asinine questions, since the principles of economics are universal. there is no such thing as a textbook which teaches Dominican Economics. as to ABC, you are in no position to assess the relative levels of our economic knowledge, because you know less than nothing.
Written by: abc200, 3 Dec 2008 3:09 PM
From: United Kingdom, Dominican Republic
lad,,
The real World is composed of economies that differently. Each case is special. Dumping is not only assessed considering the price etc. in country of origin. In that place the factor prices may not be decided by the market but by the government. In a recent anti-dumping investigation by the EU on shoes from Vientnam they took a another country as a reference, in this case Brazil. If the chinese were exporting at less than the production costs in the reference country then duimping was taking place.
You guys seem to be locked into some 3rd grade over-simplistic view of economics. I prefer to talk about the real world and its policies and not the fairy tales you spread!
http://www.chinadaily.com.cn/english/doc/2006-02/23/content_523187.htmS.
S.
Written by: anthonyC, 3 Dec 2008 7:24 PM
From: United States
Ok Dreadyboy,
Again you have resorted to insults when confront with my superior intellect.
This conversation is over. Go on and cash your civil servant check.
Written by: Trujillo, 3 Dec 2008 7:38 PM
From: Dominican Republic
When wage increases don't keep up with inflation, you get a bigger check, but inflated prices actually reduce that spending power.
From: United States
i am going to be a maverick, like John McCain. i am going to break with common belief. i am going to go out on a limb, and take a very controversial position. it is hard to substantiate, and all evidence suggests i am very wrong. the preponderant majority believe otherwise, but i am a risk taker. what am i going to do, you ask? i am going to suggest that anthonyc is intelligent.
From: United States
regarding: abc200, 3 Dec 2008 3:09 PM
What?? Please elucidate. What are you trying to say?
Written by: abc200, 4 Dec 2008 6:19 AM
From: United Kingdom, Dominican Republic
You said:
If the price is lower in the imported market than expected at origin (considering ceteris paribus) then its price dumping.
I poined out that in the real world the textbook definition of dumping extended because it is not possible to calulate factors etc. because there is no market ecoonomy. The same with Airbus vs. Boeing - each government supports the price of aircraft in different ways - so there is a long argument about valid and invalid support.
The US,Japan supports its farmers etc. etc.
S.
Written by: abc200, 4 Dec 2008 6:29 AM
From: United Kingdom, Dominican Republic
Abot 80% of the governments of the World operate meachanisms to give entepreneurs both a 'fair' profits ant to maintain ,market conitnuity, control prices etc. This tends to reduce both excessive competiton and abuse of monopoly powers. Entepreneurs can then plan future production against these policies and return a fair profit to shareholdrs etc.
S.
From: United States
I would disagree. It is possible to calculate factors of production in most countries under normal conditions, especially developed and stable economies. For countries that posses more volatility or countries that have closed economies there are formulas used to compensate for this. most developed countries use indexes similar to those used in the U.S. such as the PPI CPI PPP IPI inflation rates . In addition there are norms or benchmarks and specific guidelines set by the WTO and GATT used and adhered to by countries to determine fair pricing strategies and prevent price dumping. Price dumping exist and yes it is difficult to identify specifically in very closed economies like China.
Cont.......
From: United States
cont....
Therefore I surmise once factors of production, exchange rates inflation are calculated one could arrive at estimating a reasonable profit margin. Again for this system to work efficiently and to arrive at a fair market price and profit margin there has to be real competition, as we know real competition produces efficiency in the market, which neither exist in DR. Competition or efficiency.
Written by: abc200, 5 Dec 2008 1:45 AM
From: United Kingdom, Dominican Republic
Competirion does not necessarily produce efficiency in the market. There are many papers on this. In some situations competition produces instability, in some cases unaccounted for externalities, still others irrational depletion of resources, still others artificial product differentiations, still others misallocation of capital etc etc.
In certain areas benefits of competition outweigh disbenefits. In others the government intervenes to create quasi competitiive environments. In yet others governments use price controls etc.
S.
Written by: abc200, 5 Dec 2008 2:05 AM
From: United Kingdom, Dominican Republic
It will be interesting to see if Brown's new proposal of intravention produces the disired effects.
http://news.uk.msn.com/Article.aspx?cp-documentid=11562613My thoughts are that it will. The social costs of large numbers of repossessions occuring at the same time are large - and this alternative could work.
S.
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In the RD, they should benefit from lower commodity prices (i.e. oil, food etc.) and there should be a bigger windfall felt from the DR-CAFTA. Now, there should be more access to markets and incentives given for WalMart & Home Depot to enter the RD market. BUT DUE TO CORRUPTION, GREED OF MERCHANTS & LACK OF RD GOV EFFECTIVENESS.... the Dominican consumer does not see the lower prices trickle down during the brief tenure of DR-CAFTA. BUT IN FACT WHILE MERCHANTS SAVE & GAIN HIGHER MARGINS (from lower cost of goods) they raise prices to Dominican consumers while the world is n de-flation.
The RD Gov allows this corruption to exists! No ones accountable!
Our mentality seems to be squeeze the customer as much as possible...the first time they walk into the store...IDIOTS!!!
Of course, with this we need a comprehensive social program and progressive DIRECT taxation. This, I argue, will help increase the purchasing power of ALL dominicans.
For those of you in the US - happy goggle goggle day!
pon me lo ahi.
I mean whom among all you 'enlightened" types will decide how much a merchant should be allowed to make?
Who is so damn full of themselves that they have the cojones to tell me or anyone else how much they can make?
Then I want this jerkwad to try and tell me to my face how much money I am alowed to make.
What is a decent profit? Who decides?
That's why we can't blindly follow these US-led free-marketeers. The US does whatever they think is best for itself, we should be aware of this and link forces w/ some of our neighbors so that we can't be pushed around into settling for scraps. But if one country dares to go against the empire (i.e. Cuba), it is vilified as "evil" and others are more than happy to step in. That's why regional intergration is neede
Again I ask.
What is a fair profit and who decides?
how about waaawaaaa, waaawaaa, waaawaaa...
Or what we think of you, "stupid comment, racist comments, reactionary comments"
Ha ha :-)
The Government wants to provide cheap food? Ok. Pay the farmers what they want then sell it at a discount to the mases.
Baldoria,
I defy you to show us even one comment I have made that is even remotely racist.
Until then please refrain from the insults when you cannot answer my points.
From: Dominican Republic, Cabrera, M.T.S.
I'll keep an eye out, so be on good behavior ;-)"
I thought so.
A warning. I am not one to cower in fear of having the racist term thrown at me. I will defend myself.
"A Warning..." what warning? I warn YOU that I'll point out any bigotted statement you make. So be aware of that.
Cheers mate,
S.
http://www.cattlenetwork.com/content.asp?contentid=191991
S.
From: Dominican Republic
Wages AND buying power must increase.
How does increasing wages increase buying power? How do you increase wages without increasing inflation?
From: United States
you increase productivity, that is how.
Oh...So simple.
Now go wave your magic wand and make it so.
S.
anthonyc, nobody says it WILL happen. you ask a theoretical question, i give you a theoretical answer
Dready,
This is a Website dedicated to the D.R. Remember that. It wasn't a theoretical question that I posed. It was a question that was asked in relation to the D.R.
BTW Ignore abc. he knows even less about real world economics than your do.
Again I ask.....
What is a decent profit? Who decides?
---
In a free market society (which doesn’t exist in DR) A price is usually decided by the market at the equilibrium point. The government responsibility is to insure that price fixing is not occurring or price manipulated by suppliers. What is decent fair amount of profit? well one has to consider a decent profit should be one that doesn’t overburden society ability to acquire that product or over burden individual purchasing power, and comparing same or comparable products with others produced in other nations while considering and comparing purchasing power and all factors of production and inflation. Just as you would do when investigating price dumping. When you compare two countries who have the same relative factors of production but country A is making 300 percent more profit then it is clear there unfair pricing strategies being utilized. Its called price fixing and gauging.
The real World is composed of economies that differently. Each case is special. Dumping is not only assessed considering the price etc. in country of origin. In that place the factor prices may not be decided by the market but by the government. In a recent anti-dumping investigation by the EU on shoes from Vientnam they took a another country as a reference, in this case Brazil. If the chinese were exporting at less than the production costs in the reference country then duimping was taking place.
You guys seem to be locked into some 3rd grade over-simplistic view of economics. I prefer to talk about the real world and its policies and not the fairy tales you spread!
http://www.chinadaily.com.cn/english/doc/2006-02/23/content_523187.htm
S.
S.
Again you have resorted to insults when confront with my superior intellect.
This conversation is over. Go on and cash your civil servant check.
What?? Please elucidate. What are you trying to say?
If the price is lower in the imported market than expected at origin (considering ceteris paribus) then its price dumping.
I poined out that in the real world the textbook definition of dumping extended because it is not possible to calulate factors etc. because there is no market ecoonomy. The same with Airbus vs. Boeing - each government supports the price of aircraft in different ways - so there is a long argument about valid and invalid support.
The US,Japan supports its farmers etc. etc.
S.
S.
Cont.......
Therefore I surmise once factors of production, exchange rates inflation are calculated one could arrive at estimating a reasonable profit margin. Again for this system to work efficiently and to arrive at a fair market price and profit margin there has to be real competition, as we know real competition produces efficiency in the market, which neither exist in DR. Competition or efficiency.
In certain areas benefits of competition outweigh disbenefits. In others the government intervenes to create quasi competitiive environments. In yet others governments use price controls etc.
S.
http://news.uk.msn.com/Article.aspx?cp-documentid=11562613
My thoughts are that it will. The social costs of large numbers of repossessions occuring at the same time are large - and this alternative could work.
S.