> Aren't they? If they make $10/hour instead of $15/hour, but the goods they buy are 40% the cost that they would have been, their $10/hour is effectively $16/hour (I think I got the math right there).
I think it's a mistake to treat it like a math equation, since (among other things) that engages in the fallacy of equating Homo economicus with Homo sapiens.
But if you do want to treat it like a math equation like that. The workers may still be worse off because they don't just buy trade goods. The owner's income didn't drop, and maybe increased, so he can use greater relative income to bid up non-trade goods like real estate, healthcare, and education, pushing those things out of reach of the workers.
I think it's a mistake to treat it like a math equation, since (among other things) that engages in the fallacy of equating Homo economicus with Homo sapiens.
But if you do want to treat it like a math equation like that. The workers may still be worse off because they don't just buy trade goods. The owner's income didn't drop, and maybe increased, so he can use greater relative income to bid up non-trade goods like real estate, healthcare, and education, pushing those things out of reach of the workers.