I have a conjecture that, for many of areas of the economy, higher labor costs and higher consumer prices will favor small businesses, whereas lower labor costs and lower consumer prices will favor very large corporations. This is due to two factors. First, smaller businesses are more flexible and can better tailor themselves to worker's needs and desires. Second, with workers being less of a commodity, it gets harder to support the bureaucracy of a large corporation. A larger share of the profits are going to go to the low level workers. A corporation's primary efficiency is harvesting the cheap labor power of workers, when that labor almost exists merely as just a commodity. A corporation is all about how to direct that labor, where the cost of labor is insignificant. A corporation can afford to waste labor or inefficiently use it, since it is cheap. In other words, the supply of the labor relative to the demand for products and services will dictate whether small businesses or huge corporations dominate in the economy. If this conjecture is true then it is has huge implications for the economy and economic policy. I can give two real life examples of this theory in action. The rise of Walmart in the U.S. Immigrant labor decimates family owned farms in New Zealand (Apr 28, 2020 in Immigration section) In Marxist theory there's a dictum that states that mode of production determines economic & societal structure.
