1. Introduction: A Blind Spot in Economics Realized Through a Delivery Helmet
Currently, I work a side gig in Seoul on Fridays, Saturdays, and Sundays using a delivery platform. Last weekend, it rained steadily. My navigation kept glitching, and the water splashed by recklessly driven taxis set my nerves on edge. To make matters worse, there was a destination located up a steep incline that required making two sharp turns into narrow alleyways. I should have rejected the order, but in the rain, I had accepted it without checking carefully, leaving me no choice but to complete the delivery.
It was frustrating enough that the location was inaccessible by motorcycle and had to be reached on foot; worse, it was a multi-unit complex tucked behind another house’s main gate, taking me a full ten minutes just to locate the front door. In that instant, an outburst of profanity and visceral rage welled up from deep within me. Being in a rush after already accepting another order queued by the platform only fueled the urgency. Normally, I rarely lose my temper and maintain a calm demeanor. Yet, as I threw myself into delivery work, I was genuinely shocked by how furious I could become. This prompted several foundational questions:
- Why does the standard economic logic—that working at the terminal stage of roundabout production is beneficial simply because real income rises—fail so miserably in reality?
- Contrary to the assertions of Austrian School thinkers such as Carl Menger, Murray Rothbard, and Saifedean Ammous, why is the true opportunity cost of labor something other than leisure?
- Why does time preference continue to surge among workers at the terminal end of roundabout production, even as real income increases?
- Why are notions like the “misery of the rich” and the “purity of the poor” persistent falsehoods?
- If merely gathering together in solidarity could reshape the world, wouldn’t worker ants idle while the queen ant performed the physical labor?
In this article, I aim to organize the reflections and theoretical critiques that crystallized while working on the road.
[Photo: Formed a century ago during the Japanese colonial era, Seoul’s hillside alleyways are exceedingly steep, as shown in this photo. If you lack a good sense of direction, it is easy to get lost here at night.]
2. What the Austrian School Missed: The Opportunity Cost of Labor Is Not ‘Leisure,’ but the ‘Depletion of Human Capital’
(1) Why Do Workers Constantly Demand Higher Nominal Wages Every Year?
In Murray Rothbard’s Man, Economy, and State, human time is bifurcated into labor and leisure. Leisure is framed as the direct alternative to emphasize the scarcity and opportunity cost of labor. This Austrian view of time is mirrored across the literature, including works by Saifedean Ammous and Christopher Coyne. Inheriting Eugen von Böhm-Bawerk’s capital theory, they argue that as roundabout production becomes increasingly sophisticated, the marginal productivity of capital goods vastly outstrips manual human labor. Consequently, the output of final consumer goods surges, expanding workers’ real incomes. The foundational Austrian premise follows that even those engaged in routine, repetitive tasks will work less, consume more, and experience a sustained decline in time preference, thereby fostering broad societal prosperity.
What, then, happens to nominal wages? Rothbard projected that nominal wages would decline. In a roundabout production structure, because the marginal productivity of higher-order capital goods is overwhelmingly high, human labor becomes a fungible, non-specific factor of production. Capital goods belong to the capitalist and represent an integrated crystallization of past wages and rents. Unlike human laborers, these capital structures compress production timelines without demanding continuous wage increases; thus, human labor as a present good converges toward the market floor price. Nevertheless, because overwhelming productive efficiency drives real income significantly upward, both capitalists and laborers are theoretically expected to be satisfied.
Addressing the puzzle of why workers perpetually demand nominal wage hikes despite continuous productivity gains driven by technological innovation and capital accumulation, John Maynard Keynes posited that workers suffer from an inability to distinguish real wages from nominal wages. Keynes argued that expanding the money supply to artificially inflate nominal wages creates an optical illusion of a fatter wallet, thereby sustaining aggregate consumption in the short run (money illusion):
“Thus it is fortunate that the workers, though instinctively that is to say unconsciously, are nevertheless more reasonable economists than the classical economists, inasmuch as they resist reductions of money-wages, which are seldom or never of an all-round character… whereas they do not resist reductions of real wages…”
— John Maynard Keynes, The General Theory of Employment, Interest, and Money
In The Failure of the “New Economics”, Henry Hazlitt critiques Keynes’s naive formulation. Hazlitt points out that labor unions quickly demand nominal wage increases to match the loss in real purchasing power caused by government-engineered inflation. While Hazlitt’s counter-argument is logically sound, real-world workers often take a substantial amount of time to realize the actual erosion of their real wages. Workers struggle to compute real purchasing power in real time; regardless of whether real wages drop, they fixate on demanding higher nominal cash flows into their pockets. While this does not validate the demand-side dogma (higher nominal wages → higher consumption → GDP growth), the empirical observation remains clear: independent of roundabout production’s advancements, workers struggle to evaluate real wages precisely and persistently demand nominal increases.
Why is this? For a decline in real wages to be immediately recognized, nominal prices must spike abruptly and visibly across all sectors. However, producers are reluctant to pass 100% of inflationary costs or taxes directly onto retail prices. Instead, they preserve the external form of the product while substituting cheaper ingredients, shifting physical hardware to digital interfaces, or tweaking manufacturing processes to subtly degrade quality (shrinkflation and skimpflation). Alternatively, they discontinue older product lines and rapidly roll out new iterations where price-to-performance benchmarks are difficult to establish, diluting the consumer’s ability to calculate real inflation. Governments similarly import low-cost substitutes from low-wage manufacturing hubs like China and Vietnam to suppress CPI spikes during political terms. Consequently, consumers perceive goods to remain relatively affordable.
Therefore, consumers feel the decline in real wages primarily through the costs of services and infrastructure, rather than through tangible imported commodities. Because these factors are intangible, it takes a considerable amount of time for workers to realize that their real wages have actually decreased. Given this, it would be rational for workers to limit their demand for nominal wage increases to the nominal inflation rate to avoid being pushed out of the labor market. However, by leveraging the collective influence of democratic politics, workers instead demand nominal wage increases that far exceed the inflation rate. Why does this phenomenon occur?
Entrepreneurs cannot construct fully automated, 100% capital-intensive processes without human intervention. In particular, at the terminal “last-mile” stage—where goods undergo final inspection, servicing, sales interaction, and direct delivery to human consumers—machinery cannot substitute for human labor. As roundabout production deepens, employment at this terminal interface must actually expand.
Why? In higher-order production, capital allocation shifts away from single, expensive, low-efficiency general-purpose machines toward long, interdependent chains of specialized assets. For example, rather than deploying an expensive, all-purpose GPU from Nvidia for every workload, firms align multiple customized, low-cost micro-processors in parallel. Similarly, businesses that initially rely on high-cost individual intuition eventually codify those functions into software and organizational architecture.
However, interdependent linkages between specialized capital goods increase coordination overhead. When higher-order goods and lower-order processes are chained sequentially, systemic management costs compound multiplicatively, escalating at an exponential rate. At this point, the entrepreneur decides to break the interdependence of the production chain and hire simple labor to handle the production and sale of lower-order goods in a modularized form.
Moreover, lower-order terminal production resists full automation. While higher-order processes can be automated through standard capital investment, the terminal interface with the consumer cannot be completely delegated to machines. This is not because the human touch possesses some mystical warmth, but because the consumption interface is where non-standardized variables concentrate: regulatory compliance, bespoke customer requests, and unpredictable physical obstacles. Attempting to engineer these non-standard edge cases with expensive automated hardware causes system integration and maintenance costs to explode. Entrepreneurs therefore decouple (modularize) the lower-order stages from the high-order machinery and plug in disposable, low-skilled human labor to close the loop.
In short, Entrepreneurs channel human labor into the last mile for three primary reasons:
- Non-standardized flexibility: To handle unpredictable edge cases that algorithms cannot compute—navigating labyrinthine alleys, resolving ambiguous addresses, and handling direct human interaction—at minimal capital cost.
- Capital coupling cost reduction: To avoid the exponential overhead of attempting to integrate hyper-complex machinery directly into erratic field environments, choosing instead to bridge the gap with basic manual labor.
- Risk and liability externalization: To outsource physical hazards and emotional friction—such as navigating rainy roads, handling delivery delays, and absorbing on-site hostility—away from the core enterprise and directly onto the individual contractor.
Thus, as roundabout production deepens, higher-order stages become ultra-capital-intensive, while lower-order last-mile stages develop a skewed structure that absorbs massive quantities of low-skilled labor as shock absorbers against operational and regulatory volatility.
This creates an inevitable power struggle between capitalists—who invest in high-order structures—and laborers stationed at the lower-order terminal. Especially in the physical “atom market” where property rights are physically vulnerable, if a labor majority halts operations under democratic protections, even the most advanced higher-order capital goods instantly degrade into idle scrap metal. Workers thus maintain the legal and physical leverage to extract higher nominal wages. However, the mere existence of this leverage is insufficient to explain why they choose to engage in collective solidarity. Even though they could be guaranteed promotions and higher wages by breaking away from such solidarity and complying with corporate demands, they still choose not to do so. This points to a deeper reality: routine, repetitive labor imposes an existential cost that standard models fail to capture.
(2) The Problem of Simple Repetitive Labor: The Depletion of Human Capital
Carl Menger’s theory of imputation establishes that consumer marginal utility determines the economic value of goods. Böhm-Bawerk extended this to the production structure, arguing that the value of higher-order capital goods is derived retrospectively from the prices consumers pay for final goods—a foundational pillar of the Austrian Business Cycle Theory.
While logically sound in theory, in reality, value is generated endogenously through the systemic combination of capital goods rather than purely through consumer marginal utility. Consumer marginal utility does not exist a priori as an independent command ordering production into existence. An isolated consumer cannot evaluate marginal utility in a vacuum. As Maurice Merleau-Ponty identified “contrast” as the primary mechanism of perception, consumers evaluate and choose goods retrospectively by contrasting what competing producers make available. If only one producer on earth could manufacture a machine with a given capability, the conventional framework of marginal utility breaks down: diminishing marginal utility requires alternative opportunity costs, and without comparative benchmarks, the economic calculation of opportunity cost cannot occur.
In other words, entrepreneurs must first present alternatives before consumers can compare and evaluate marginal utility. And, an entrepreneur’s competitive edge stems not from hiring exceptionally talented floor workers, but from the ability to structure and orchestrate capital goods. Consequently, higher-order stages receive dense capital investments while terminal stages are staffed by basic, labor-intensive inputs. The operational objective regarding labor is to ensure that whichever interchangeable worker is plugged into the final node, standardized performance is guaranteed. Terminal labor in roundabout systems—such as delivery or line assembly—is engineered to permanently sever the worker’s intellectual feedback loop the moment baseline proficiency is attained.
Workers emotionally resonate with demands for nominal wage hikes above their marginal productivity not solely due to democratic political power, but because the labor itself rapidly depreciates their human capital. At the terminal node of roundabout production, workers are denied the intrinsic fulfillment derived from solving complex problems, writing, or intellectual exploration. The brain operates in a cognitive vacuum of sustained monotony. To cope, delivery drivers consume YouTube streams or talk continuously on Discord while riding.
Off the clock, the brain rushes toward cheap, high-velocity dopamine hits—late-night delivery food, alcohol, hyper-sexualized content, short-form reels, and gambling—to compensate for the cognitive deprivation endured throughout the day. Over time, executive neurological function atrophies, eroding emotional regulation, long-term planning horizons, and the capacity for delayed gratification. This is precisely the crux of the matter; it raises workers’ time preference, driving them to obsess over immediate nominal wage increases. The very fact that a massive, homogenized labor force has assembled instantly dilutes individual accountability and long-term judgment. Left only with the confidence that they can physically control the “last mile,” these anonymous workers engage in radical real-world actions that infringe upon private property rights—actions that are then politically backed by democratic institutions.
No rational human simply rejoices at working short hours with high hourly earnings if the nature of the work hollows out their internal agency. When self-actualization, craftsmanship, and cognitive problem-solving are stripped from work, laborers experience their working hours as acute existential erosion and profound alienation. Even as they recognize their deteriorating cognitive faculties—diminishing future orientation, rationality, and self-control—they find themselves unable to break the cycle. The behavioral backlash is an aggressive, uncompromising demand for higher nominal wages.
Contrary to the Austrian perspective—which assumes that advanced roundabout production enables workers to enjoy leisure and live comfortably off higher real income—labor possesses an intrinsic utility that goes beyond merely serving as the opportunity cost of leisure. Because roundabout production empties labor of this intrinsic value, workers aggressively demand nominal currency as an economic offset.
(3) Is Higher Real Income Enough?: The Capitalization of Labor
As discussed, humans do not easily perceive real income shifts in real time. If price mechanisms were frictionless, nominal and real values would align; however, relentless state intervention in democratic systems produces profound distortions between nominal numbers and real purchasing power. When real income trends are ambiguous, individuals instinctively seek to convert their labor into tangible, durable assets. When a vocation demands human autonomy and creative problem-solving—allowing accumulated skills, tacit knowledge, and reputation to compound into implicit human capital—individuals willingly accept lower present nominal income for the sake of future capital accumulation.
Terminal labor, such as gig delivery or routine clerical tasks, offers no such compounding trajectory. Because today’s labor does not build equity for tomorrow, workers demand compensatory rents from both the state and entrepreneurs for their own human depreciation. Even if they directly observe gains in real purchasing power brought by technological deflation and roundabout production, the complete inability to capitalize their labor into future assets compels them to demand inflated nominal wages as self-insurance against their own depreciation.
In conclusion, the high factor price of labor that Henry Hazlitt and Murray Rothbard continuously condemned is not merely an external distortion caused by government intervention or union coercion; it represents an inherent structural boundary condition of the roundabout production system itself. The more entrepreneurs attempt to circumvent labor by automating higher-order processes, the more reliant they become on human labor at the terminal last-mile interface—where workers, insulated by democratic institutions, leverage their strategic position to command asymmetrical bargaining power.
3. The Circular Reasoning of Time Preference and the Regression of Terminal Laborers
(1) The Circular Reasoning of Time Preference and Terminal Workers’ Addiction to “Hyper-Short-Term Pleasure”
One realization that dawned on me while doing delivery work is that time preference—a foundational concept in the Austrian School—contains a circular argument.
For instance, mainstream Austrian theorists such as Rothbard and Hoppe outline the following causal schema:
Lower Time Preference → Savings & Capital Accumulation → Sophistication of Roundabout Production → Higher Productivity & Real Income → Further Decline in Time Preference (Civilization)
While arguing that a low time preference is a prerequisite for capital accumulation, they paradoxically explain the real-world condition for lowering one’s time preference as “the expansion of real income through roundabout production.” Only through increased real income, they argue, does uncertainty about the future diminish, allowing savings to expand and interest rates to decline. In this circular loop—where roundabout production requires a low time preference, yet lowering time preference depends on real income gains from roundabout production—laborers at the terminal end of the roundabout process actually tend to develop an extremely high time preference.
As observed earlier, terminal workers cannot convert today’s labor into intellectual capital or intangible assets. Instead, they endure cognitive depletion and severe monotony, eroding their capacity for complex problem-solving. Deriving no intrinsic utility from the work itself and accumulating nothing durable, all that remains after the shift is “immediate pleasure to numb the pain right now (delivery takeout, alcohol, sexual stimulation, short-form reels, gambling).” In the end, the deeper one sinks into the terminal nodes of roundabout production, rather than falling, time preference spikes drastically (High Time Preference), resulting in a total loss of the capacity to plan for the future.
Even if government-induced inflation were constitutionally prohibited and average societal real income rose, terminal laborers would still mobilize en masse to protest: “Whether this company goes bankrupt tomorrow is none of my business—raise my wages today.” The authentic precondition for lowering time preference is the compounding of present labor into durable assets. For instance, when someone builds their own knowledge base, content repository, research portfolio, or business infrastructure, every unit of labor invested today compounds steadily into tomorrow’s assets. Creators willingly enduring low immediate wages to focus on long-term value represent a prime example. Only when individuals possess the conviction that their labor translates into durable, compounding value are they willing to defer present gratification for the future (Low Time Preference).
However, this is not something capitalists can guarantee for them. The capitalist just undertakes capital expenditure to convert their own invested capital into long-term enterprise value. Furthermore, persistent demands for nominal income increases lead to employment instability and lockouts, and the money earned this way fails to convert into interest-bearing capital. This is because the core of capital formation is the deferral of consumption. Assets plundered from others ultimately vanish in forms such as gambling, consumption, scams, and divorce lawsuits. What matters is not how much you earn now, but whether you have the ability to substitute present goods with future capital. However, living entire life with a worker’s mindset will never allow us to reach this state.
Unless workers make their own sovereign decision to operate as producers and as self-directing capitalists investing in their own future, even rising real incomes cannot prevent the net utility of labor from deteriorating, which inexorably drives time preference upward. However, I am skeptical about whether workers are truly capable of achieving this kind of sovereign awakening. What kind of future can there be in a spectacle where they unite to clamor for nominal wage increases, demand state intervention, and then squander those forcibly extracted wages on short-term pleasures and consumption? They would be fortunate if consumer prices do not rise so high that it ends up destroying their own jobs. From this perspective, the notion that the poor masses are inherently pure and have merely been corrupted by the ruling establishment is a complete illusion.
(2) Media-Manufactured Fantasies: The “Misery of the Rich” and the “Purity of the Poor” Are Lies
Popular media sells the illusion that the rich, despite their wealth, lack a sense of meaning and suffer from psychological malaise, while the poor remain spiritually untarnished. My firsthand experience proved otherwise. One practical observation from delivery work is that affluent neighborhoods feature well-paved roads and clearly organized addressing systems, allowing deliveries to be completed within a few steps of parking the motorcycle. In contrast, impoverished neighborhoods frequently require calling the customer directly.
While I rarely interact directly with the rich, those in impoverished neighborhoods with whom I exchanged calls routinely vented irritation at me simply for asking for their exact location. I did not call out of a desire for personal contact; I was forced to call due to ambiguous directions like “walk all the way to the left and up the stairs,” unregistered dwellings tucked inside other housing structures, or delivery notes requesting “hand it to me directly.” Yet, they reacted with hostile irritation as if their privacy had been violated.
This behavior is intimately tied to the nature of their labor. Residents in poor neighborhoods frequently perform simple, repetitive tasks at the terminal end of roundabout production, leaving their cognitive bandwidth for empathy and consideration completely drained. In my own delivery experience, continuous exposure to relentless time pressure down to the second, physical fatigue, and the stress of chasing platform incentive quests induced a chronic sense of urgency. I found myself cursing pedestrians who dashed across crosswalks against the light out of impatience, and after finishing a shift, the acute stress made me crave cigarettes despite having quit for over a year.
Reflecting on this, the trope that the wealthy suffer from broken homes, mental distress, and moral fragility while the poor remain spiritually resilient despite material deprivation is fundamentally untrue. The wealthy fully harness the intrinsic utility of labor (self-efficacy, autonomy), and because the fruits of their work accumulate as compounding capital, they maintain an expansive, future-oriented mindset and psychological composure. When those investments bear fruit over time, material abundance reinforces patience and benevolence in everyday interactions.
Conversely, those trapped in routine, manual labor derive zero intrinsic utility from work and possess no guarantees for the future. Spending their daily wages on delivery food for instant sensory relief, they ultimately face a destitute old age, demanding that “the state take responsibility for my life.”
The mass media pedals the myth that “the rich are miserable and the poor are pure” to placate public resentment toward elites and distribute cheap moral superiority. From a praxeological perspective, the uncomfortable truth is clear: prolonged exposure to terminal labor stripped of autonomy and creativity breeds defensive aggression, whereas directing capital and deriving intrinsic fulfillment from labor provides the psychological margin and resources necessary to sustain benevolence and personal harmony.
4. The Illusion of “Collective Strength”: The Rider Union and the Pitfalls of Collectivism
Although I am currently engaged in low-income labor with an insecure future, I do not believe the path out lies in collective platitudes like “standing united brings change.” Even so, I frequently encounter organizers soliciting membership for delivery rider unions, handing out flyers at pickup hubs like grocery stores.
In principle, platform riders are independent contractors with the autonomy to reject orders to undesirable locations; they do not hold employee status. The platform is not an employer in the traditional sense, making the demand for a conventional labor union fundamentally misplaced. Watching those who believe that sheer numbers and collective force can engineer prosperity strikes me as deeply misguided.
The rider unions wage political battles to secure legal employee classification. Through affiliated intermediary networks, they push to eliminate part-time gig riders, prioritize full-time couriers, establish minimum guaranteed base pay per order, enforce commercial insurance mandates to push out undocumented immigrant labor, and implement facial recognition authentication. Rather than escaping repetitive manual labor and compounding their skills into durable assets to secure a better future, they remain trapped in high time preference, throwing tantrums at platforms for higher nominal payouts. Has this collective pressure improved the union’s productivity? Absolutely not.
Considering that value added is generated by entrepreneurs and capital structures—not by brute labor units—a union assembly cannot conjure value out of thin air. Instead, it breeds internal factions and erects entry barriers where incumbent insiders lock out latecomers. A privileged aristocracy of organized labor captures state-backed employee protections and high wages, while compliant platforms secure monopolistic positioning—ultimately pricing the vast majority of consumers and unskilled laborers out of the market.
Blaming external structures to rationalize past apathy during high school or college, while retreating into Netflix and cheap dopamine hits after a tough shift, is a form of self-deception. If you desire a different life, you must forge it through sovereign choice; demanding that others restructure reality on your behalf is not a responsible posture—it is economic extraction. Windfalls secured through such coercion are quickly squandered on consumption because they were not earned through deferred consumption, disciplined saving, and capital returns. The end result is chronic resentment and personal decline.
Political rent-seeking through labor unions is ultimately a counterfeit solution that fails to lower time preference, leaving workers enslaved to the system; authentic liberation lies in making the sovereign shift toward becoming a producer who actively capitalizes their own labor. If mere collective assembly could change the fundamental laws of nature, worker ants would be resting while the queen ant toiled—yet reality operates on entirely different principles.
5. Conclusion: Stop Being a Cog; Become an Independent Entity Supplying Value to the Roundabout Chain
Remaining a routine laborer within a roundabout production chain leads to a stagnant life entirely dependent on capitalists raising nominal wages. The only path to permanently lowering one’s time preference is to become a micro-entrepreneur—converting today’s labor into intellectual “capital” through specialized knowledge and original content to earn structural returns. Because such labor is inherently autonomous and creative, one willingly accepts lower nominal income in the present. The profound sense of self-efficacy and the satisfaction of building future assets are incomparably more fulfilling than shouting grievances at a platform algorithm while stuck in delivery traffic.
The responsibility of the state is simply to step aside and allow those who refuse to take ownership of their lives to bear the costs of their choices. Delivery driving is not a viable long-term vocation; neither is any other terminal node in a roundabout production network. Demanding nominal wage increases from corporations and governments is futile. Even if nominal wages rise, the intrinsic nature of mindless labor paralyzes rational cognition and keeps time preference high, preventing wages from ever turning into savings and trapping the worker in mindless consumption. Wealth handed to someone who has never practiced deferring gratification, saving, and accumulating capital quickly evaporates.
Contrary to conventional Austrian assumptions, merely lifting real income through roundabout production is insufficient to satisfy the human laborer. Labor is not merely an opportunity cost to leisure; it carries intrinsic utility. That utility consists of the self-efficacy of taking charge of one’s own destiny, personal accountability, and the active compounding of labor into durable capital.
The state exists not to capitulate to populist demands for effortless entitlement, but to dismantle those rent-seeking demands and protect the sovereign individuals who save capital, take risks, and strive to become authentic producers.
6. Related Articles
- [The Democratic Citizen’s Brain 1] The Market Landscape Hidden by the Democratic Welfare State: Why We Must Abandon ‘Making’ and Sell ‘Romance’
- [The Democratic Citizen’s Brain 2] Why a Linear View of Time (Judeo-Christianity, Historicism, Democracy) Threatens Modern Producers
- [The Democratic Citizen’s Brain 3] A Phenomenological Guide to Debugging Agony: Why Producers Must Read the Citizen’s Pain to Dominate the Market
- [The Democratic Citizen’s Brain 4] Anamnesis Strategies for Producers — The Alchemy of Memory (Aristocratic Selection vs. Plebeian Consolation)
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- [The Democratic Citizen’s Brain 7 — PoW vs. PoS: Part 1] The Desacralized World: Proof-of-Work, Sacred Order, and the Pain of Roundabout Production
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