permaculture

["Trudie Redding" <tredding@mail.utexas.edu>]

Who says bigger is better. More likely the city zoning laws keep
individuals from having cottage industries and these people then have
nothing in addition to no medical benefits. They may want to keep it
small as in the 'one chair beauty salon' that is allowed by some zoning
laws in some cities
".....workers who forgo other employment 
opportunities will not receive the level of benefits they would get with
a traditional employer; and economically, their 
labour will not reap the productivity benefits of scale and network
effects...."
Is it an opportunity or a necessity to have to work for someone else?
Trudie Redding
University of Texas at Austin
ENS 103 C0803
Austin, TX - 78712
Telephone: 512-471-8044
Fax: 512-471-5532

-----Original Message-----
From: permaculture-bounces@lists.ibiblio.org
[mailto:permaculture-bounces@lists.ibiblio.org] On Behalf Of Lawrence F.
London, Jr.
Sent: Sunday, April 29, 2007 8:27 AM
To: permaculture
Subject: [permaculture] Keep it in the neighbourhood | Free exchange
|Economist.com


<http://www.economist.com/blogs/freeexchange/2007/04/neighborhood_waxing
.cfm>
Sunday April 29th 2007
Keep it in the neighbourhood
TrackBack URL for this entry:
http://debate.economist.com/cgi-bin/mt-tb.cgi/13729

WHILE driving through rural South Carolina recently, I was surprised to
find that nearly every home I passed had a sign 
advertising some cottage industry. Each offered a range of services from
"small welding projects" to "bikini waxes" 
(though no one I surveyed had ever patronised that particular business).
These businesses were not necessarily limited 
to modest homes; it spanned a spectrum of income levels.

Cottage industry has traditionally been a building block of economic
development. In industrialised countries it was the 
first form of manufacturing and paved the way for the industrial
revolution. Home production has traditionally been 
common to low income, less skilled workers and its popularity counter
cyclical. When the economy provides less jobs 
workers become more likely to engage in home production.

In developed economies home production is generally inefficient. Take
the at home bikini waxer, whom I assume is female. 
Performing bikini waxes from her home, on a back country road, limits
the scale of her business. If she set up a 
commercial shop in a central location she would attract more customers
and have the space to employ others. Working at 
home saves overhead, but limits the scope of her production; the
increased volume means commercial waxer will be able to 
charge less and serve more customers.

But does this hold in the internet era?  For waxing, yes.  But for other
home production businesses, not so much. 
Through forums such as ebay, their client base has been extended to the
global community.

It is still unclear what the impact of this will be on the labour
market. The number of workers who claimed to be 
engaging in home self employment, as of 2003, still seemed to vary with
the business cycle.  This may not reflect the 
scope of the industry, because many home entrepreneurs have their home
business to supplement other income. But it does 
seem to be the case that women and the elderly have become more likely
to become self-employed.

It will be interesting to see what the impact on the labour market will
be. On the one hand cottage industry provides 
income to those who normally may not work such as retirees, and women
engaged full time in child care. It also 
encourages more entrepreneurial activity which can spur growth. On the
other hand, workers who forgo other employment 
opportunities will not receive the level of benefits they would get with
a traditional employer; and economically, their 
labour will not reap the productivity benefits of scale and network
effects.



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