Alternatives to a higher minimum wage

minimum-wage-vs-eitc

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2 Responses to “Alternatives to a higher minimum wage”

  1. Henshaw Says:

    Raising the minimum wage isn’t inefficient. It doesn’t work. Artificially higher wages make it more difficult for low skilled workers to find employment.

    It’s sad that in 2013, people still believe price controls are still a good idea.

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  2. philebersole Says:

    As I wrote the last time you made this comment, this assertion is not backed by empirical evidence.

    Common sense suggests that a business owner will pay whatever he or she needs to pay for whatever they need to stay in business, up to the point where costs make it impossible to stay in business.

    I agree that in theory it is possible to raise minimum wages to a level where that happens. Research shows this doesn’t happen to any detectible degree within the range of actual minimum wage increases in the United States.

    http://www.slate.com/blogs/moneybox/2013/02/13/minimum_wage_research_the_case_for_a_higher_minimum_wage.html

    http://robertvienneau.blogspot.com/2011/03/card-and-kruegers-research-on-minimum.html

    http://www.huffingtonpost.com/peter-dreier/raising-the-minimum-wage-_b_2750336.html

    One thing economists have done is to compare employment in continguous counties of states that have different minimum wages. Presumably they are similar except for the difference in minimum wage. Whatever effect the difference in minimum wage, it is too small to show up in the employment statistics.

    It is sad that in 2013 the empirical evidence is ignored.

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