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It's a combination, where the demand curve never meets the supply curve at an acceptable price for the consumer.

It could be due to being able to obtain a product cheaper from somewhere else due to lower labor costs (happens due to converging standards of living across the world), and it could also happen that there are alternatives, such as other jobs and/or social security disability or welfare that make doing undesirable jobs need an even higher price point to make it worthwhile.



Your last point is why I've never understood the claim that Wal Mart subsidizes its low wages with public welfare.


Wal Mart specifically tells it's employees to get on welfare. They even pass out food stamp forums in the office.

Why should my tax dollars be going to subsidize a for profit company, which is making billions of dollars of profit?


a lot of people on public welfare work for a living. child tax credits, obamacare subsidies, subsidized student loans and grants.


But the minimum price they're willing to work for has to be higher than if the welfare benefits didn't exist.


Many welfare programs requires recipients to work as able.




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