Economics & Thermodynamics

[Abstra]

When a company takes on a new employee they consider almost every parameter except how far the employee lives from the point off productivity. The reason is that there is no direct relationship between company profitabillity and the means by which the employee gets there.

The empoyee is actually inflicting a cost not only to the employee but to the overall economy by employing someone from a distance but that is not reflected in the company's profit and loss account so it is given a very low priority. It does effect the profit line in an indirect way but an accountant would find that cost diificult to quantify.

When I first applyed thermodynamics to the decision making procedure i could not initially find any reason why a company would apply it. Then I found that altering the employer tax system did the trick. A strange thing then emerged, when a company reached around 500 employees. It then appeared to become more profitable to break the company up into smaller productive units in different geographical locations. At a point off critical mass employees are coming from further and further away costing the company a small fortune; better to split the company in half moving the geographical production units nearer the location of the people working there.

I does somewhat throw cold water on the idea that one big factory is beautifull for example. It may actually be expensive to the overall economy.