In Marxian analysis, capitalist firms increasingly substitute capital equipment for labor inputs (workers) under competitive pressure to reduce costs and maximize profits. Over the long-term, this trend increases the organic composition of capital, meaning that less workers are required in proportion to capital inputs, increasing unemployment (the "reserve army of labour"). This process exerts a downward pressure on wages. The substitution of capital equipment for labor (mechanization and automation) raises the productivity of each worker, resulting in a situation of relatively stagnant wages for the working class amidst rising levels of property income for the capitalist class.
What pushes businesses to increase pressures on workers? What impact does workers working harder have on productivity of a business? When less workers are required, what happens to the job market? What impact does higher worker productivity and leveled pay have on higher earners? What do capitalist firms substitute equipment for in a Marxian analysis? Why do firms substitute equipment for workers? What trend increases the organic composition of capital over the long term? What does the substitution of equipment for labor raise for workers? What type of wages does mechanization and automation lead to?