Strider wrote:It costs $1000 to for everything needed to make one pair of shoes. If you make two pairs, the cost per unit of production reduces to $500 per pair of shoes. If you make 100 pairs, $10 per pair of shoes - and so on. Obviously I am ignoring variable costs here and using fixed costs only in this example.
Yes, mine was only that, an example. I just want to point out that there are many layers between the production and the consumer. An item with a low price tag may have a better / more direct distribution channel than an item with a high price tag, making possible to sell it at a very competitive price. High price is not a good indicator of the condition of the factory workers at origin.
Strider wrote:FYI - Farming our own tomatoes is to do with job specialisation and trade, not economy of scale.
[/quote]
What I mean is that economy of scale is one of the pillars of commerce. Without commerce we would be still growing our own food, making our own shoes, etc.