Minimum Wage, another good first pass

TheGrandmaster Economism: Bad Economics and the Rise of Inequality

In typical Conservative examples, a higher minimum wage will raise labor costs. But many companies can recoup cost increases in the form of higher prices; because most of their customers are not poor, the net effect is to transfer money from higher-income to lower-income families. In addition, companies that pay more often benefit from higher employee productivity, offsetting the growth …

Min Wage and shared prosperity in Finland

TheGrandmaster The Nordic Theory of Everything

In recent years labor activists have been fighting to raise the American minimum wage from the federal $ 7.25 per hour to $ 15. At the center of this fight sits the fast-food industry, where workers typically earn wages barely above the legal minimum. The Nordic countries don’t have national minimum wages; instead minimum levels are set by collective-bargaining agreements …

Min Wage – It’s not a market distortion, if the market is prior distorted

TheGrandmaster Seven Bad Ideas

Faith in the Invisible Hand led to the once-general belief that a higher minimum wage results in lost jobs. It presumes that the wage paid reflects the worth of the workers and that any wage increase resulting from a minimum wage law represents an overpayment to workers, reduces profits, and also reduces the hiring of new workers. But in fact …

Min Wage increases demand – First line of Defense

TheGrandmaster Under the Affluence

Hanauer then went on to explain the economic logic behind a higher, rather than lower and stagnant minimum wage. Putting it in terms that even the most jaded of corporate executives should be able to comprehend, he notes: If a worker earns $7.25 an hour, which is now the national minimum wage, what proportion of that person’s income do you …

Minimum Wage – Seattle and Job Growth

TheGrandmaster Under the Affluence

Perhaps the strongest rebuttal to the claim that a hike in minimum wage will harm the economy comes from Seattle. The city, which will be phasing in a $15-per-hour minimum wage over the next several years—and has been pilloried in the business press as signing its economic death warrant for doing so—already had a much higher minimum wage than the …

Minimum Wage – No increase in Unemployment first line of defense

TheGrandmaster Under the Affluence

Contrary to claims that such a boost might have a negative impact on overall employment—principally by raising labor costs for employers—evidence from sixty-four separate studies suggests the impact of minimum wage hikes on employment and unemployment levels is negligible at best, and certainly offset by the boost in income to those who are dependent on such wages for survival. 137 …

Min Wage, and who bears it

TheGrandmaster Saving Capitalism

Whatever wage gains these workers receive are rarely passed on to consumers in the form of higher prices. That is because big-box retailers and fast-food chains compete intensely for customers and have no choice but to keep their prices low. It is notable, for example, that in Denmark, where McDonald’s workers over the age of eighteen earn the equivalent of …

Min wage as high school entry level debunked

TheGrandmaster Saving Capitalism

Most workers earning the minimum wage are no longer teenagers seeking additional spending money. According to the Bureau of Labor Statistics, the median age of fast-food workers in 2014 was twenty-eight, and the median age of women in those jobs, who constituted two-thirds of such workers, was thirty-two. The median age of workers in big-box retail establishments was over thirty. …

Min Wage Level 10

TheGrandmaster Saving Capitalism

In addition, and significantly, the gains from a higher minimum wage extend well beyond those who receive it directly. More money in the pockets of low-wage workers means more sales in the places where they live, which in turn creates faster growth and more jobs. Research by Arindrajit Dube, T. William Lester, and Michael Reich confirms this. They examined employment …

Min wage employment refutation

TheGrandmaster Saving Capitalism

The mythology that a minimum-wage increase (or, in real terms, restoring it to its 1968 level) would cause employers to reduce employment is a common trope. A corollary is that getting rid of the minimum wage altogether and allowing employers to pay what employees are “worth” will reduce or even eliminate unemployment. As former congresswoman Michele Bachmann once put it, …

Another simple refutation of min wage opponents.

TheGrandmaster Saving Capitalism

Had the minimum wage retained the value it had in 1968, it would be $10.86 an hour. And, of course, by 2014 the nation’s economy was far larger than it was then, and far more productive. We had high min wage and no problem paying it before. Republicans are just pissed. Change is scary. But now of this is unprecedented. …

Min Wage increase – Post Ready

TheGrandmaster People's writings

a good example is the minimum wage. Putting a cap on prices almost always reduces supply. The more employers have to pay, the fewer they will be able to hire, right? So increasing the minimum wage leads to reduction of available jobs to lower wage workers. So the classical Conservative rhetoric goes. Sounds pretty legitimate right? On the surface, it …

Min wage and job effect 1

TheGrandmaster Under the Affluence

Contrary to claims that such a boost might have a negative impact on overall employment—principally by raising labor costs for employers—evidence from sixty-four separate studies suggests the impact of minimum wage hikes on employment and unemployment levels is negligible at best, and certainly offset by the boost in income to those who are dependent on such wages for survival. (1) …

Robert Reich – Min Wage Aug 2015

TheGrandmaster Robert Reich Facebook Page

Carly Fiorina – the former CEO of Hewlett-Packard who drove its stock into the ground, fired 30,000 workers, and left with a severance package of $21 million — held forth today on the minimum wage. She made 3 arguments you’ll hear again and again from Republicans. Here they are, accompanied by the truth: 1. “The minimum wage should be a …

Min Wage – Good Opener

TheGrandmaster The Instant Economist

Here’s an insight for opponents of a higher minimum wage to mull over: Let’s say a 20 percent rise in the minimum wage leads to 4 percent fewer jobs for low-skilled workers (as some of the evidence suggests). But this also implies that a higher minimum wage leads to a pay raise for 96 percent of low-skilled workers. Many people …

Minimum Wage – Lower Turnover

TheGrandmaster Online Articles

Opponents of higher wages — generally, business groups and their political allies — have raised the same objections in Los Angeles that have been raised since the dawn of the federal minimum wage in 1938: that higher pay will lead to layoffs and business closings or business migration. But experience and research involving actual minimum wage increases indicate otherwise: The …

TheGrandmaster Robert Reich Facebook Page

Democrats are readying a major push in mid-March to raise the federal minimum wage to $10.10 an hour. That’s not enough. It should be raised to $15. Here are 7 reasons why: (1) Had the minimum wage of 1968 been adjusted for inflation, it would be well above $10 an hour today. But the typical worker today is also more …