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Thanks. I'll have to read more about tax incidence. But naively speaking, what's the incentive for a corporation to increase employee pay in this scenario rath

Thanks. I'll have to read more about tax incidence. But naively speaking, what's the incentive for a corporation to increase employee pay in this scenario rather than just maximize shareholder value?

harryh 11y ago
The same incentive they have to pay you anything more than the minimum wage: the market. If there is more profit in the system how that profit gets allocated (higher wages, lower costs to customers, shareholder value) depends on the relative leverage of the various parties involved.