Answer: Why do some people believe that it's the consumers, not employers, who actually determine wages, and how does this idea challenge the concept of a living wage?

For context, this is a questioned I answered on Quora

Consumers determine how much revenue a business earns and the amount of revenue a business earns determines how much they can pay out in wages after covering other overhead costs like utilities, rent, insurance and supplies. It’s not just consumers though. The floor of wages is the margin of production where the least productive labor, land, and capital can still be profitably employed in a competitive market. In case of land, businesses will have to pay higher rent for better locations. The amount a landlord demands in rent effects how much is left to pay out in wages. A better location with more traffic might lead to higher revenue but higher rents can negate this advantage especially for small businesses if the rent hikes are steep. The productivity of labor is partially dependent on business’s access to capital as even skilled labor with years of training and education isn’t very productive without capital investment in the tools needed for it to be more productive. Businesses operating at larger economies of scale due to both the size of the operation and their location in a large metropolitan area serving millions of customers instead of thousands can pay out higher wages as well because they have more revenue to spread over fixed operating costs even with the higher rents that are charged in large metropolitan areas. Of course, the wages you can bargain for in the labor market itself is also contingent on the scarcity of yours skills and education. A “living wage” is an ever shifting goal post. Every time the general rate of wages rise in an area so will rents to consume a higher portion of the new “living wage” and the cost of living with also vary by person based on existing obligations (e.g. children or elderly parents) and within the same zipcode (an Apt across the street could be hundreds more).